The biggest health trust in Britain has put itself in a financial “turnaround” after it emerged that it has been losing £2m a week.
Barts Health Trust in London is bringing in management consultants to address the financial problems.
In May the trust had a £15.7m deficit on the financial year beginning April - a loss of almost £2m a week over those two months - according to board papers published earlier this month.
Officials said that the deficit was “significantly worse” than projected.
Reports suggests that to turn around finances the trust may have to see cuts to its services or services curtailed.
The Guardian said that chief executive Peter Morris has told staff that the trust is at risk of “financial failure”.
In an email to staff, obtained by the newspaper, Mr Morris said: “We are in the business of providing high-quality safe care and just like all businesses, whether in the public or private sector, we need to be a financially stable organisation. Currently we are not.
“The main causes of our deficit are poor cost controls across all areas, non-delivery of planned cost improvement programme schemes, reduced income through less procedures/treatments being undertaken as planned, and pressure within A&E.
“In quarter one (April, May and June 2013), every clinical academic group and some corporate directorates have exceeded their budgets, meaning that we do not have robust cost control measures in place. We are simply spending more than we have available.
“We need to reverse our current direction to avoid financial failure and protect services for our patients.”
The hospital trust is the largest in the UK, with an annual turnover of £1.25bn and a workforce of 15,000, and services a population of 2.5 million people. It operates out of six hospital sites: Mile End Hospital, The London Chest Hospital, The Royal London Hospital, Newham University Hospital, St Bartholomew’s Hospital and Whipps Cross University Hospital.
A spokeswoman for the trust said: “We wish to be clear that Barts Health is not in administration. Having not met our own financial targets for the first quarter of the financial year, we have, with immediate effect, placed ourselves in financial turnaround.
“Financial turnaround has not been imposed on us, and by taking this decision proactively and at the earliest possible opportunity, we believe we have acted responsibly to secure our long-term financial viability, allowing us to continue to provide world-class healthcare to the people of east London and beyond.”
The trust is also bracing itself for a rigorous inspection by the new Chief Inspector of Hospitals.
This week Professor Sir Mike Richards announced a series of inspections using a new new risk assessment tool - which uses a number of factors to determine whether a hospital has a high, medium or low risk rating for safety, effectiveness, its care for patients, its responsiveness and whether or not it is well led.
Barts Health was deemed to have a “high risk” and is one of 18 trusts being investigated in the first wave of inspections by the new inspector.
A trust spokeswoman added: “We continue to strengthen the quality of care for our patients following our recent merger and welcome the new inspection process. We will use the findings to continue to build high quality services and to address any areas in need of improvement.”
Are you able to Speak out Safely?
Sign our petition to put pressure on your trust to support an open and transparent NHS