Birmingham hospitals' huge financial deficit millions more than anticipated

Finance chiefs they can't 'understate the scale of the challenge' the trust faces

Increased staff costs have left Birmingham hospitals with a huge financial deficit - millions more than originally anticipated. Figures presented to the University Hospitals Birmingham NHS Foundation Trust board showed the current deficit after the first five months of the financial year to be £59.6 million.

This is £39 million more than the trust expected to be at this point of the year. Bosses were told staff pay was the biggest reason for the deficit with hundreds of permanent staff taken on but the use of temporary workers has not reduced significantly.

A financial recovery plan is being put together to address the concerns raised at the meeting, which took place on Thursday (September 26). Julian Miller, chief financial officer, said: "As at Month five we have a very significant deficit - £59.6 million for the first five months of the year which is £39 million adverse to the year plan.

READ MORE: The number of staff being off sick at Birmingham hospitals is 'chronically high'

"I can't understate the scale of the challenge we are facing here. As reported previously, the majority of the overspend relates to pay - there is a £29.4 million year to date overspend on substantive staffing.

"The success of our recruitment has seen over 600 staff whole time equivalent since the plan was set in month nine. We've now got fewer nursing vacancies and that's a good thing. It would have been a positive if it had been accompanied by a corresponding reduction of temporary staffing.

"While agency has come down and continues to come down, what we've seen a significant overspend against our bank budget. There will be some reasons behind that (such as sickness rates). Large portions of our workforce - qualified nursing, healthcare support workers, junior doctors - do tend to be covered through temporary staffing.

"Nevertheless, we would have expected bank usage to have reduced much more significantly on the back of substantive recruitment. When we discuss our financial recovery plan, we are going to have to focus around the temporary workforce being an area where there are opportunities to reduce what we are spending and us being in a position to be able to do that."

Board chair Dame Yve Buckland said: "The board will be meeting to go through a financial recovery plan to address the concerns which have been raised. Clearly, we do need to address this. We will, of course, be very mindful of any quality and safety implications if so doing that and we will of course be very mindful of the motivation and morale of front line staff. Obviously this is a very big issue."

Should smoking be banned in pub gardens and other outdoor venues?