The foundation trust sector massively overspent on contract and agency staff in the final three months of last year, data from the regulator Monitor shows.
The sector planned to spend £397m on such staff over the quarter ending on 31 December but it actually spent £977m – an overspend of 146%.
All types of trusts overspent on contract and agency costs, but the problem was most pronounced in the acute sector – where there was a 152% overspend – and among mental health trusts, which overspent by 141%.
According to review by Monitor, the variance was partly explained by “labour market factors”, such as difficulties recruiting nurses and middle grade doctors.
However, the regulator said the size of the overspend also suggested “poor workforce planning”.
It added that some trusts had highlighted increased staffing in response to the Francis and Keoth reviews – both critical of clinical understaffing – to explain the variance compared to planned costs.
The overspend on contract and agency staff is part of a wider picture of deteriorating financial performance among foundation trusts, although the sector seems to be maintaining operational performance despite this.
Of 147 foundation trusts, 39 are in deficit; more than the 24 which had planned to be in deficit and almost double the level at the same period last year (21).
The combined deficit of these trusts was £180m – £12m higher than the £168m expected. Monitor said 60% of the overall deficit could be attributed to five organisations, all of which are subject to regulatory action.
The most challenged region is the Midlands and East.