Trusts relying on 'emergency' loans

BBC analysis of official figures shows that the amount of money loaned by the government to NHS trusts in England doubled between 2016-17 to 2018-19.

The Nuffield Trust think tank says that hospitals in England are currently ‘lurching’ from month to month on emergency government loans to cover costs, with some NHS hospitals having to cut spending on patients to pay the interest.

In total, NHS trusts owed £10 billion to the government in 2018-19 for ‘interim revenue support’ and paid £185 million in interest last year. Interim revenue support was given to 122 NHS trusts, according to Department of Health and Social Care's annual reports. Interim revenue support allows hospitals and other healthcare providers to meet running costs while running at a deficit.

The Nuffield Trust has said that hospitals were already unable to cover costs and were being forced to make further cuts in spending on patients to pay interest charges.

For example, borrowing by King's College Hospital NHS Foundation Trust in London, which has been in financial special measures since 2017, more than doubled from £244 million to more than £510 million between 2016 and 2019, the equivalent to nearly half of its income over the last year. The trust spent £136 million more on patient care than it was given last year and in its annual accounts admitted to being ‘reliant’ on government loans.

Sally Gainsbury, senior policy analyst for the think tank, said: “Many hospitals can only survive by lurching from month to month with emergency bailouts from central government. While it is true that interest paid to the department can in theory be recycled back out to the NHS, there is by no means a guarantee that it will go back to the individual NHS organisations that paid it. That leaves NHS trusts in the greatest financial difficulty unable to plan their future and make spending decisions that best suit their patients."

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