Newcastle hospital bosses believe they are halfway to plugging £80m deficit

The RVI is just one of the hospitals owned by the Newcastle upon Tyne Hospitals NHS Foundation Trust. Credit: ITV Tyne Tees

Newcastle hospital bosses believe they are halfway to plugging a £80 million cash deficit.

The Newcastle upon Tyne Hospitals NHS Foundation Trust, which runs the Royal Victoria Infirmary and Freeman Hospital, warned two months ago that it was failing to make sufficient savings and as a result was facing serious financial trouble.

In March it was reported that had the Trust continued spending at its previous rate, it could run out of money by September.

Sir James Mackey, the Trust's chief executive said bosses were working “rapidly to address that situation”.

City councillors have now been told that cost-cutting plans have managed to slash the hospitals’ estimated deficit for 2024/25 in half, from £80 million to £40 million.

Rob Harrison, the Trust’s new managing director, told the local authority that bosses were aiming to get close to a balanced budget but with “clear focus on doing it without affecting direct patient care”.

The problem is said to have arisen as the Trust was meant to deliver £33 million in recurrent savings during the previous financial year.

It actually only managed to find £6 million through of repeating year-on-year savings and was instead forced to rely on one-off cuts to try and balance the books.

The challenging financial situation came amid a backdrop of a damning Care Quality Commission (CQC) report which downgraded Newcastle Hospitals from ‘outstanding’ to ‘requires improvement’ earlier this year.

Mr Harrison said on Thursday: “We are really focused on doing everything we can to protect frontline services. There are efficiencies we can make in clinical areas, but that is not the same as cutting those services.”

He added: “We are looking at the estate we use. Buildings cost money and if there are opportunities to change how many buildings we use and keep their services, but run them in a different way, then we are going to look at that.”

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