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NHS assets get government “backing”

Hospitals belonging to the NHS will have their assets underwritten by the government in a bid to stop them going bust and ending up in court, it has been reported.

The Department of Health document leaked to the Health Service Journal (HSJ) describes how the government intends to help NHS hospitals which are failing financially and struggling with patient quality care.

According to the paper, which is to be published for public consultation, trusts will be advised on how to avoid insolvency.

The document says NHS chief executive David Nicholson would take control of failing trusts but there would be a legal obligation to make sure patient services were not disrupted while the organisation was turned around. This means that some services could be provided at a loss.

One government adviser told the HSJ that he expects it to be a major election issue. He said: “This regime will draw a sharp contrast between government plans to ensure continuity of service, and Tory plans to put services at risk whenever hospitals get into debt.”

The HSJ also reported that NHS trusts may hand their private finance initiative (PFI) hospitals over to specially-created charities to avoid reporting PFI debts on their balance.

Copyright PA Business 2008

The Department of Health