HOSPITAL accountants are expecting to tighten their belts, after a government blunder left them short of £1.3m.

Great Western Hospital had applied for a £5m cash loan from NHS Improvement

But Karen Johnson, finance director, said civil servants had only handed over £3.7m. NHS Improvement had claimed the hospital was already being given extra money through the provider sustainability fund, a £2.45bn NHS pot for trusts that need more help balancing their books.

Mrs Johnson said that was never part of the agreement with the department of health.

Speaking at the GWH board of directors meeting, she said: “Our loan agreement of £15m over the course of the 12 months, which they have seen, was prior to any provider sustainability funding.

“When we first submitted the plan our plan was to borrow £24m, but it didn’t include any PSF. We reduced that down to £15m and it was very clear that the £15m was on top of the PSF.

“To come back and reduce it wasn’t reasonable.

“Their cash team is saying their understanding is that our loan agreement needed to be offset by the PSF. We have provided solid evidence that this is not the case and it is not what we have reported to them all the way through the year.”

With £1.3m less than they asked for, Mrs Johnson predicted some difficult weeks for hospital accountants as they had to more carefully manage expenditure. GWH needs cash to pay staff salaries and supplier bills. Typically, the hospital spends between £25m and £35m every month.

“We have gone back to NHSI and said we will manage it this month. We’re just going to have to manage our cashflow tighter,” she said.

“Because we’ve got quite a robust process we are okay with that, but we will need to borrow £7m in March, instead of the £5m that was originally in the plan.”

NHSI recognised that they needed to find the extra cash, Mrs Johnson said.

“I don’t think there’s a risk.

“It’s not ideal. I don’t need it at this time of the year when you’ve got everything else happening.”

She suggested the confusion could have arisen from a “lack of understanding” of the documentation given to NHS Improvement by the hospital.

Applying to NHS Improvement for short term cash loans is not a new phenomenon for GWH. In common with other trusts, the Swindon hospital has asked for emergency cash on a quarterly basis. The loans must be paid back with 1.5 per cent interest.