No bail out for hospitals crippled by £187m debt

PUBLISHED: 15:13 13 November 2008 | UPDATED: 15:40 25 August 2010

THE government has said it will not pay off the £187.2million combined debt of three hospitals that are now one step closer to merging.

THE government has said it will not pay off the £187.2million combined debt of three hospitals that are now one step closer to merging.

Bosses at Queen Mary's Hospital, Sidcup, Queen Elizabeth's Hospital, Woolwich, and Bromley Hospitals NHS Trust approved a merger recommendation made by the SE London Acute Trust Joint Committee, at their separate board meetings last week.

But the Department of Health confirmed on Monday they would not wipe out the £187.2million combined debt, even if the merger went ahead saying it would be unfair to other organisations.

This means the hope of the merged Trusts becoming a Foundation Trust would be extremely difficult as they would need to prove they were in control of their finances.

The Joint Committee have already admitted the merger will not enable the Trusts to repay the combined historic debt as they believe the debt is 'beyond their capacity'.

A spokesperson for the Department of Health said: "We have no plans to write off the £187.2million outstanding debt of the three Trusts.

"All NHS organisations must stay within their means and we cannot write off debt as a matter of course when they fail to do so. "This would be unfair to other organisations that have made tough decisions in order to stay within their budget."

Now the three Trusts will begin a 12-week consultation with staff and other stakeholders before they go ahead with the proposal which is scheduled to take place on April 1 next year.

The merger is expected to save the Trusts £2.6million in its first year, rising to £3.2million the year after. This could result in redundancies in the top managerial jobs, their administrative staff and around 20 posts in the finance departments. A spokesperson from Queen Elizabeth's Hospital, said: "The message from the board is divided the three hospitals will fall but united we may stand a chance of surviving."

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