West Herts Trust set to end financial year with £18.2m deficit

The NHS Trust that runs Watford General Hospital expects to end the financial year with a deficit of £18.2m, county councillors have been told.

Inflation, emergency pressures and industrial action are said to be among the factors that have impacted on the finances of the West Herts Teaching Hospitals Trust, which also runs St Albans City and Hemel Hempstead hospitals.

And on Friday (1 March) the trust’s chief strategy and collaboration officer Toby Hyde outlined the trust’s financial position to a meeting of the council’s impact of scrutiny advisory committee.

Mr Hyde told the committee the NHS as a whole had experienced “significant financial challenges through this financial year”.

And he highlighted the impact of inflation on staff costs and the impact of industrial action, as well as the costs of medicines and other supplies.

He also pointed to the number of staff at the trust – which he said had increased by around 15 per cent in the wake of the pandemic.

He said that increases in staffing had initially been funded by government, but that that funding was no longer available.

And he said what they were now doing was looking at how to “right-size” the workforce.

Meanwhile other factors reported to have contributed to the deficit included costs associated with mental health patient management, the higher expenditure of theatre support staff and increased outsourcing of care.

Mr Hyde had been invited to talk to the committee about the trust’s plans for £16m of efficiencies during the 2023/24 financial year – highlighted at an earlier scrutiny of the patient experience.

Mr Hyde reported to the committee that by the end of March the trust expected to have made £12m of the planned efficiencies – 75 per cent of the initial £16m target.

And he later catalogued a range of measures being implemented or expanded at the trust that were impacting on costs

He pointed to the success of the expanded virtual hospital, which he said was providing better care for patients at a reduced overall cost.

He referenced the greater use of telephone and video appointments and patient-initiated follow-ups – reducing the need for patients to travel to hospital and increasing outpatient productivity.

He highlighted community providers that were now treating up to 10 ‘999’ patients a day in their homes – rather than them being brought to A&E.

And he highlighted video assessments now provided to paramedics where a stroke is suspected – reducing the number of patients brought to hospital and the financial impact across the health system.

Meanwhile trust chief nurse Kelly McGovern told councillors the trust had saved a significant amount in recent months by moving staff around the hospital to reduce the amount spent on agency staff.

Councillors had asked for detail about the plans for efficiencies to see how they could be achieved “without negatively impacting on the patient experience”.

Chief nurse Kelly McGovern pointed to the ‘clinical voice’ in the trust – stressing the importance of care, safety and quality.

And it was reported to councillors that the trust had systems in place to monitor performance data, patient feedback and patient experience questionnaires.

Meanwhile Mr Hyde said that 2023/24 would be the first year in four that the trust had not broken even.

Liberal Democrat Councillor Sandy Walkington raised reports that the trust would require £60m for basic maintenance of buildings.

Acknowledging the estate “especially at Watford General”, Mr Hyde said the trust spent “a huge amount of money every year” on maintaining the estate.

He said the imperative was keeping it safe for staff and patients, which “carries a significant financial burden for the organisation”.

And referencing the redevelopment plans, he said: “We have major ambitions around redevelopment of our site.

“It’s great that there is some really good progress on the work at St Albans. That’s all very live at the moment – with a huge amount of construction work.

“We are really pleased to have positive progress on our redevelopment plans for Watford – and hoping that we can get into clearing the site ahead of construction starting in 2026.

“So all of that I think creates hope of a really great future for the organisation.”