Nottingham hospital trust 'spending more than it can afford' as it tackles £104m shortfall

The Queen's Medical Centre in Nottingham
The Queen's Medical Centre in Nottingham -Credit:Joseph Raynor/ Nottingham Post

Leaders of Nottingham's hospitals have admitted they are "spending more than we can afford" as they launched a plan to tackle a total shortfall of more than £100 million. Nottingham University Hospitals (NUH) Trust, which runs the Queen's Medical Centre and City Hospital, had a £71m deficit at the end of the 2023/24 financial year, with an underlying deficit of £104.5m.

This places "significant risk around our ability to operate, deliver quality care and meet our local population needs", the trust said in its board papers ahead of a meeting on Thursday, May 8. NUH cited its aging estate, "sustained" industrial action and high levels of inflation as some of the main reasons for the deficit.

It also said investment in services such as maternity and emergency care and the end of income that was received during the Covid pandemic had contributed. "On a monthly basis we have been spending more than we budgeted," read documents.

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In April, Nottinghamshire Live revealed NUH made an agreement with NHS England to reduce its costs after the national healthcare body said a forecast shortfall of £69m could mean NUH is breaching the terms of its licence. Outlining its Financial Sustainability Plan, NUH said it would be able to reduce its deficit to around £50m by April 2025 and would be able to breakeven the following year, before also breaking even with its underlying position the year after.

Part of the plan involves outsourcing large chunks of its finance department, with the trust putting a number of staff at risk of redundancy. "We understand that there are challenges driving the financial position, but there are also significant opportunities to improve our efficiency and effectiveness as an organisation," board papers say.

"We understand that this is an ambitious plan for a trust with limited track record of delivery of recurrent savings, and we are seeking support to help us deliver this year." The trust said it has already began making savings including reducing or stopping some non-essential spend, reviewing all vacancies and reducing the amount of money spent on agency staff, which has increased by 71 percent since 2019/20.

While NUH, which employs 19,500 staff, did not specify compulsory redundancies in plan, it hinted at possible job losses. "Productivity is at the centre of our financial sustainability plan as we recognise the need to do more within our funded resources. This will mean that we need to transform what we do, and how we do it, which will mean that the trust will need fewer people to do what we do today," part of its 2024/25 efficiency programme reads.

Paul Matthew, chief financial officer at NUH, said: “We are currently facing financial challenges and have produced a comprehensive financial plan to reduce our deficit and achieve a breakeven position by April 2026. Our financial plan aims to support us in making significant savings over the coming years but will do so in a way that does not compromise patient safety.

“We know that there is more work to do, especially to reduce our pay bill and we cannot rule out a reduction in posts in the future. We know this will be unsettling and want to make it clear that in these circumstances our priority is to protect jobs and avoid compulsory redundancies.”