Funding for new health schemes at St Helier Hospital could be lost in contingency plans drawn up to save Epsom and St Helier NHS Trust from falling further into debt.

The cash-strapped trust, which is currently facing an overspend of £3.3million, has been told to offer £2million of its capital allocation to offset its current revenue position.

In its latest performance report for the period to November 2002 , the proposal put forward by the South West London Strategic Health Authority would result in "little or no new schemes starting before April".

And the move would also mean around half of the trust's allocation for next year would already be committed if schemes planned for this year were to begin in April.

Board members have considered the trust's dire financial performance, which has experienced a sharp downturn in the space of just a few months.

Although the trust's overspend has been blamed on several factors such as expensive fees for agency staff to cover current vacancy levels and increased drug expenditure, it is still locked in a dispute to recover £2.15million from the East Elmbridge and Mid-Surrey Primary Care Trust (PCT).

The trust is claiming this money, which brings its budgetary shortfall to more than £5million, should be repaid after the PCT failed to take responsibility for three main financial obligations.

These include £1.1million which the trust made in cost savings with a view to spending on other projects; £500,000 spent by the trust on meeting the Commission for Health Improvement's action plan and £500,000 which the trust spent on extra nurses and the cost of running a new CT scanner.

Despite a meeting scheduled between the trust and the PCT on January 16 to discuss the situation, no solution has yet been reached to end the dispute.

A trust spokeswoman said: "Epsom and St Helier NHS Trust are in the process of rescheduling a meeting with East Elmbridge and Mid Surrey PCT to resolve the financial shortfall."

January 31, 2003 11:31