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Annual Report 2003-2004: Financial Review

Financial Review

In March 2003 – following a 12 month period of engagement and discussion involving doctors, nurses and other clinicians along with a wide range of local people – the NHS in Bedfordshire and Hertfordshire set out its vision for improving local healthcare and creating a health service fit for the 21st century. The vision proposed the separation of planned healthcare from emergency healthcare, the centralisation of specialist and complex health services in fewer hospitals and argued for the delivery of more healthcare outside of hospital settings. This was published in a document called Investing in Your Health which then became the subject of public consultation.

Most of the assumptions that underpinned Investing in Your Health remain valid today:

But since the Investing in Your Health decisions in 2003 some things have changed as healthcare delivery has evolved or moved on. Patients are spending less time in hospital and more services are now being delivered safely and effectively in the community, closer to where people live.

Financial review

The Trust has reported an overspend of £519,000 for the year based on a budget of £215,098,000. This represents one quarter of a percent of the budget and needs to be seen in the context of providing more care and treatment for patients. During the year the Trust also had to implement a savings programme to deliver some £5,800,000 of savings. This was recognised by the Health Economy as an ambitious and challenging target.The Trust had other statutory financial targets to meet during the year in addition to balancing the budget and these were to:

:: Meet the capital investment needs of the Trust within the resources available. The Capital Resources Limit for 2003/04 was £9,757,000 and the Trust spent £6,599,000. The underspend was due to funding being received in advance of the purchase of new Linear Accelerators to provide Radiotherapy treatment at Mount Vernon. This purchase will occur this year.

:: Ensure that the Trust did not exceed the cash available to it in paying for all goods and services. The External Financing Limit last year was a negative £8,661,000 and at the end of the year the Trust's cash balance was £0k. This confirms that no cash was used other than the monies available and the target on cash management was achieved.

A further target is the prompt payment of bills. In 2003/04 the target figure was that 95% of bills paid would be paid within 30 days. The Trust actually paid 94.2% of bills within 30 days.

In conclusion, the Trust has had a challenging financial year and whilst it has just failed to achieve a balanced budget it has meet its targets on capital resource and cash management. The Trust is working with its main commissioning PCTs to produce a sustainable balanced financial position for this year and into the future.

A complete set of accounts can be obtained from the Finance Directorate on 01923 217 107

Vincent Doherty, June 2004
Interim Director of Finance

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