£22M DEBT IS WRITTEN OFF
Government to expunge money owed by health trust to help NHS in fight against coronavirus
Sunderland’s hospital trust is to have millions of pounds in debt written off to help the battle with the coronavirus.
Health Secretary Matt Hancock announced last week that £13.4billion in NHS debt was to be written off.
Figures now show that will include £1.3billion across 15 NHS Trusts in the North East and Yorkshire. South Tyneside and Sunderland will see £22.12million in revenue debt expunged.
Across the region, County Durham and Darlington will see its debt cut by £30.1million Gateshead by £12.23millionwhileSouthTeeswillhave debts totalling £144.62million written off.
Matt Hancock said: “As we tackle this crisis, nobody in our health service should be distracted by their hospital’s past finances.
“Today I’m pleased to confirm the value of this package for the North East and Yorkshire.
“This £1.3billion debt write-off will wipe the slate clean and allow NHS hospitals to plan for the future and invest in vital services.”
Some have taken out loans to plug funding gaps in their day-to-day (revenue) or capital (infrastructure) budgets.
Nationwide, 107 Trusts have an average of £100million revenue debt each, with the two trusts with the highest debts reaching a combined total of over £1billion.
NHS chief executive, Sir Simon Stevens, said: “We've advocated for and support this pragmatic move which will put NHS hospitals, mental health and community services in a stronger position – not just to respond to the immediate challenges of the global coronavirus pandemic, but also in the years ahead to deliver widespread improvements set out in our NHS Long Term Plan."
Under the new rules set out in a letter to all NHS Trusts, should hospitals need extra cash this will be given with equity, rather than needing to borrow from the government and repay a loan.
The debt write-off package was launched in combination with a simpler internal payment system to help NHS trusts in dealing with the COVID-19 response, agreed with NHS England.
The Government says the change will mean hospitals will get all the necessary funding to carry out their emergency response, despite many cancelling or limiting their usual services such as elective surgery or walk-in clinics due to the virus.