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Written question asked by Lord Warner (Labour), in the House of Lords. It was answered by Earl Howe (Conservative) on Thursday, 15 December 2011.

NHS: Debt

Question
To ask Her Majesty’s Government what plans they have (1) to write off the historic debts of hospital trusts, (2) to extend the periods of repayment of such debt, or (3) to use the reserves of foundation trusts to repay historic debt held by other trusts.
Answer

As part of being authorised as a National Health Service foundation trust, a NHS trust must show that it is clinically and financially viable with a sound business plan, alongside other requirements in relation to quality of services and governance. As part of the viability test, NHS trusts holding historic debt on their balance sheets are required to achieve the criteria set by the Independent Regulator of NHS Foundation Trusts (Monitor). As part of the Government commitment to deliver an all NHS foundation trust sector, the department is currently exploring the potential provision of support to specific NHS trusts which may need support to achieve foundation trust status because of historical financial issues but which are able to present a sustainable plan going forward. The framework and process by which such support might be provided has not yet been finalised. In relation to any support provided to NHS trusts four key tests have been established that would have to be met: the problems they face must be exceptional and beyond those faced by other organisations; they must show that the problems are historic and that they have a clear plan to manage their resources in the future; they must show that they are delivering high levels of annual productivity savings; and they must deliver clinically viable, high quality services, including low waiting times and other performance measures. One means by which such financial support may be provided is to assist NHS trusts in meeting the liquidity requirements for authorisation as a foundation trust once all the other assessment criteria are met. NHS foundation trusts are independent health bodies and not subject to direction by the Secretary of State. As self-governing organisations, foundation trusts retain any surpluses they make to reinvest in the local health economy for the benefit of patients.

Secondary information

Type
Written question
Reference
14125; 733 c287WA
Session
2010-12
Subjects
Debts Finance NHS trusts NHS foundation trusts
Link
View this Written question on www.publications.parliament.uk