14.12.16
Collapsed Sherwood and Nottingham merger cost NHSI 'eye-watering' £10m
Work undertaken by two Nottingham hospital trusts to prepare for an ill-fated merger cost the NHS an ‘eye-watering’ £10m, it has been revealed.
NHS leaders wasted £6.6m on ‘professional adviser’ fees while working on a deal to merge NUH (Nottingham University Hospitals) NHS Trust and SFH (Sherwood Forest Hospitals) NHS Foundation Trust earlier this year, a move which eventually collapsed last month.
The breakdown was publicly blamed on poor A&E performance at NUH, which runs the Nottingham teaching hospital Queen’s Medical Centre, but the BMA found that the deal was scuppered by other practical issues.
Healthwatch Nottingham chair Martin Gawith described the situation as “astounding”, saying: “You believe we have a professional NHS in this country but to see we’ve spent more than £6m on private consultants simply to be back at square one is horrendous.’
A Freedom of Information request to NHS Improvement (NHSI) revealed that the regulator was forced to reimburse the trusts £10m in total, having spent £6.1m on consultant fees, £1m on clinical support and £2.4m on backfilling seconded staff positions.
NHSI told the BMA that the costs reflected the “accelerated timeline” of the merger, which was targeted to be completed in nine months despite its speculative nature, as it aimed to create the second-largest trust in the country.
BMA council chair Mark Porter said: “It is a matter of supreme irony that these ‘eye-watering’ amounts of money have been spent on management consultants in the pursuit of financial savings forced because of the restrictions on resource from central government.”
The merger was intended to save the struggling SFH, which was rated inadequate by the CQC and placed in special measures in 2014 after Prof Sir Bruce Keogh’s review of mortality identified higher numbers of deaths than expected in the trust.
NHSI was reportedly keen for the trust not to fall into administration, with a long-term partnership with NUH being seen as cheaper and better for helping to recruit and retain staff.
However, the merger was paused in October after NUH’s chair and CEO stepped down, and senior managers eventually made the decision to cancel the merger last month eight months after it was announced, with the Department of Health not consulted at length about the merger at any point.
Rupert Egginton, NUH director of finance Rupert, said: “The trust‘s financial positon has not been adversely affected by the costs of the work associated with the long-term partnership. NUH has received financial support and reimbursement for the costs incurred.”
An NHSI spokesperson claimed that the money spent by the regulator has contributed to improvements at SFH, as the trust finally came out of special measures last month.
The spokesperson said: “Both trusts are committed to working closely together, but have agreed not to pursue a merger at this time to enable Nottingham to focus on improving waiting times in its emergency care department.”
The merger had been at the heart of Nottinghamshire’s STP plans to save more than £500m from its health and social care budget. However, the STP was published soon after the merger’s collapse was announced.
(Image c. Thornypup Flickr)
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