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NHS Kernow 'facing £27m budget black hole'

NHS Kernow 'facing £27m budget black hole'

Published by Emma Carton at 7:02am 5th February 2020.

Written by Local Democracy Reporter, Richard Whitehouse

The NHS body responsible for providing the services needed by people in Cornwall has reported it is facing a deficit of more than £27million.

NHS Kernow, the clinical commissioning group (CCG) for Cornwall, said that its forecast deficit for the current financial year was set at £27.24m in December.

It had deteriorated by £10.4m compared to the previous month when it was forecast to be £16.8m.

The CCG had held an extraordinary meeting of its governing body last month when the forecast deficit was formally reported.

On Tuesday, the latest financial report for December - the most recent month for reporting - gave details about the forecast deficit.

It was reported that as a result of the deficit NHS Kernow is set to breach its financial obligations.

The report, from chief finance officer Clare Bryan, states: "The revised forecast outturn reported at month nine reflects an adverse movement off plan by £10.4m. 

"As a result the current forecast for 2019/20 is a deficit of £27.2million. 

"This is a breach of the CCG's statutory duty to breakeven in year (ie spend no more than the allocated resources)".

It also states that "NHS Kernow reported a further net risk of £1.9million which it is focussed on eliminating in the lead up to year end". 

This is primarily related to mental health spend on funding care packages.

Highlighting some of the key points of the report it explains that there are a number of factors which are affecting the finances of the CCG.

The report states that acute pressures remain in place saying that they are "mainly in relation to University Hospitals Plymouth". 

Details later in the report indicate that due to increased activity in the winter period NHS Kernow has agreed a revised settlement with UHP which is £2.28m above the original contract.

It also reveals that while NHS Kernow had planned to make £33.9m in efficiencies in 2019/20 it was now forecast to make £22.5m - a shortfall of £11.4m.

The report also outlines pressures from mental health care provision, community services and primary care, linked to prescribing costs.

In a section on running costs the report explains that "processes remain in place to manage staff recruitment and ensure the CCG remains focussed on reducing management costs".

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