"The Department of Health has made a concerted effort to
identify the challenges faced by the 113 NHS trusts seeking
foundation status. Many of their problems stem from longstanding
issues around financial viability, underlying performance and
clinical quality. The Department will have to tackle these issues
head on if high quality and affordable health services are to be
available to all."
Amyas Morse, head of the National Audit Office,
13 October 2011
Many NHS trusts need to tackle a range of
financial, quality and governance issues if they are to meet the
standards required of them to become self-governing foundation
trusts by 2014, according to the National Audit Office. The
Department of Health and the NHS will now have to decide how they
will deal with those facing the most severe problems.
The processes the Department has put in place
to help NHS trusts achieve foundation status have brought matters
to a head, by highlighting the challenges many trusts face in
proving their long term viability.
For some trusts the pathway to foundation
trust status will be relatively straightforward. However, at least
20 trusts face such substantial problems that they have recognised
they are not financially or clinically viable in their current
form. These problems are often deep-seated and long-standing. Size
and location can cause problems, including a mismatch between
hospital capacity and local demand for services from commissioners.
In some cases the Department will need to be involved in decisions
about and support for reconfigurations of local hospital
services.
Other trusts may have less severe problems,
but will still have to improve their financial and, in some cases,
clinical performance if they are to be sustainable in the long term
and become foundation trusts. A number of these trusts, will need
additional support from the Department, such as helping them to
strengthen their management and governance arrangements.
The most common challenges are financial. In
July 2011, the Department’s assessment was that 48 out of the 113
candidate trusts were unlikely to meet the regulator Monitor’s
tests of trusts’ financial viability. An initial review of 22
trusts with major PFI schemes has identified up to six trusts for
which the scale of debt repayments, together with other financial
problems, means that they are not currently viable.
The difficulty of achieving foundation trust
status is magnified by the challenge trusts face in making
year-on-year cost savings of at least four per cent. Many trusts
will have to achieve even greater savings than this to show that
they are financially viable.
Publication details:
HC: 1516, 2010-2012
ISBN: 9780102976724