Teaching hospital trust placed in financial special measures

NHS Improvement announced this morning that Barking, Havering and Redbridge University Hospitals Trust would be placed in special measures.

HSJ reported in November that an investigation was taking place into the late payment of suppliers. Sources said a £15m emergency bailout loan was required from the Department of Health and Social Care.

The investigation was led by audit firm Grant Thornton alongside another investigation from NHSI.

When the investigation was announced, NHSI said to “avoid any perception of conflict of interest” the work would be led by a team “independent of the NHS Improvement London region”.

Up until May 2017, the trust’s finance director was Jeff Buggle, who is now finance director for NHSI London. The head of NHSI London, Steve Russell, and winter pressures director Sarah Tedford are both former senior managers at the trust.

The £558m turnover organisation’s last predicted year-end deficit for 2017-18 was £30m – a worst case scenario produced in November. The trust said its cash position was under “extreme” pressure.

A spokesman for the trust said it could not confirm what the revised deficit position would be.

NHSI’s statement today said the decision to put the trust in special measures came after a “rapid and significant deterioration in its in-year finances”.

It has appointed an unnamed financial improvement director.

NHSI chief executive Ian Dalton said: “We are concerned about the speed and pace of this decline and so are taking quick action to prevent the financial situation getting worse.”

“Our action is designed to give the trust the immediate and direct intensive support to rapidly improve its finances, while continuing to provide the safe, high quality care its patients deserve.”

Papers for the trust’s board meeting earlier this week contained no finance report or mention of finance. There was also no finance report in the January or December board meetings.

The January papers did include minutes of a finance committee meeting in November, which noted a £20m overperformance on the trust’s £346m contract with local commissioners and added that the committee had “reviewed the financial plan 2017-18, including the trust’s underlying position from the previous year”.

The trust announced Ian O’Connor as interim director of finance, joining from George Eliot Hospital Trust, earlier this week.

In March 2017, the trust exited quality special measures after the Care Quality Commission noted a range of improvements in key services.

In a statement the trust’s chair Joe Fielder and chief executive Matthew Hopkins admitted there had been ”an absence of thorough oversight, a loss of financial control, and increased demand on our services2 and said ”All of this combined and has meant that we were not able to secure a large sum of performance-related income”.

They confirmed that an agreement had not been reached with their commissioners and that it was not a “reflection of the quality of care we provide”.

In a statement they said: ”We reported last year that we were experiencing financial difficulties, which first came to light in the second half of the year when it became clear that our cash flow, and overall financial position, were not as healthy as had been reported.

”As a result of the significant deterioration in our forecast, NHSI has decided, in accordance with its usual procedure, that we should be placed in special measures for finance to provide additional support and so they can be assured that we have control of the situation.”