£8m budget deficit predicted at Great Western Hospital - as directors warn of 'continued deterioration' in accounts

The latest forecasts estimate that the hospital will fall well short of its planned deficit of almost £5m.

Accountants at the Marlborough Road hospital fear that missing the targets set by government quango NHS Improvement (NHSI) could impact next year’s budget.

Karen Johnson, finance director at GWH told a meeting of the hospital trust's directors: “It is unlikely now that we will hit our control total by the end of the financial year. Clearly that has ramifications for the budget for next year.”

The admission that the hospital “continues to see a deterioration” in its finances comes after accountants brought in a recovery plan aimed at clawing back £2.5m in savings.

Ms Johnson hinted that the missed targets could result in staff losses. She said: “Some of the decisions we’ve made in the recovery plan are short term. They are holding posts that we know we can’t hold forever.

“We’ve raised that with NHSI. We’re delaying the inevitable.”

Presenting the accounts for November at a meeting of hospital trust directors on Thursday, she said that spending on drugs had jumped.

On the oncology ward, managers forked out extra cash for “specialist” cancer treatments – costing up to £15,000 per patient.

“That’s quite a big hit,” said Ms Johnson. However, she added that the money would be paid back by NHS commissioners.

She warned that falling clinical activity levels could hit the hospital’s budget, with winter pressures meaning that fewer procedures could take place.

The hospital had been in talks with Swindon Clinical Commissioning Group to “block” their contract, paying for Swindon patients’ care in advance rather than paying per patient in arrears. However, these talks had fallen through.

“At the moment the CCG is seeing pressures within their primary care setting and are not able to commit to blocking that position,” said finance chief Karen Johnson.

The change would see a drop in income over December and January, she added.

Ms Johnson said: “It looks like the activity was significantly lower than last year, which means that the income will drop as well – largely because the hospital is so ‘chocka’.”

Hospital accountants plan to speak to NHSI about the deficit problems next week.

However, Ms Johnson said that it was expected the hospital would this week be allowed to draw down cash funding by the department of health. NHSI had committed to an emergency cash injection if it was needed, she said.

Ms Johnson agreed with a board member that it was “very unlikely” that GWH would be left without cash to pay its suppliers.