Foundation trusts struggle financially and fail to meet cancer targets, Monitor reports

The number of foundation trusts facing financial risk has increased in the first quarter of 2010/11, according to Monitor.

Monitor has published its review of NHS foundation trusts for the first quarter of 2011/12.

The review found that during the first quarter of 2010/11, 16 foundation trusts reported a financial risk rate of one or two, up from 10 last year (one is the highest risk rating, five is the lowest).  

Monitor said: ‘As we indicated in our review of foundation trusts’ 2011/12 annual plans, the trusts with the most severe financial problems will take longer to recover due to the complexity of some of the issues.’

Although the number of trusts with a high risk rating has increased, the average risk rating has decreased from 3.5 to 3.3.

Foundation trusts have achieved an overall surplus of 19%, however it is less than it was at quarter four in 2010/11 (20%) and is down on the historical average underspend of 23%, the review said.

Monitor’s chief operating officer Stephen Hay said: ‘It’s encouraging that the sector is in overall surplus and ahead of plan for the first quarter - although surpluses are lower than last year due to the economic environment.

‘But there are a number of foundation trusts that are beginning to struggle and we are looking closely at these and taking regulatory action in several cases to make sure that the issues are addressed.’

Foundation trusts have also seen an increase in governance risk rating, with 42% having an amber or red risk rating.

The main cause of the increase governance risk rating was outstanding Care Quality Commission (CQC) compliance actions, the review said.

Montior said: ‘We work closely with the CQC to ensure joined-up regulation and expect foundation trusts to take action on CQC compliance actions.

‘If they do not fix the problems the CQC has identified within the agreed timescale, we will consider whether we need to use our regulatory powers.’

The review also found that cancer targets had continued to be a challenge for foundation trusts in 2010/11.

Over a third (32) foundation trusts failed to meet one or more cancer targets, the review said.

Responding to the review Mike Farrar, chief executive of the NHS Confederation, said: 'This is further evidence that pressures are mounting across the NHS.

'By far the biggest problem the NHS is facing is the £20bn of efficiency savings we need to find by 2015. This is a problem we cannot ignore.'

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