Why is the trust facing such large financial problems?

According to the NHS Acute Trusts financial director (Graham Bennett, Report to the Trust Board 6/4/2006) the reasons for the financial problems facing the trust can clearly be identified as follows

... its recurrent expenditure has exceeded its recurrent income every year since its establishment. In 2005/06 the underlying deficit has been assessed as being 20m. An analysis of this led the Trust to believe that its costs are approximately 12m higher than they should be compared with the national average, and that its income is approximately 8m less than it should be. Of this higher than average expenditure, approximately 7m is attributable to the costs of running the new PFI financed hospital at Worcester. The income shortfall broadly correlates to the relatively low funding position (of 12m)

The Acute Trust, with access to their own accounts have clearly identified that a significant proportion of the Trusts deficit are due to two reasons

• The PFI Hospital in Worcester
• The trusts low funding position

To put it simply, the Trust considers that it finds itself in its current financial position due to government policy! The trusts own accountants states this quite clearly in their own publicly released documents.