Royal Devon and Exeter Hospital: 'Cuts to blame' for deficit

The Royal Devon and Exeter Hospital chief executive said the £2.7m debt is disappointing

An NHS trust has said budget cuts are to blame for a projected £2.7m budget deficit.

Each year since 2010, the Royal Devon and Exeter Hospital (RD&E) has seen a reduction of four per cent in funds for treating patients.

As a result, it has received £11m less each year.

The hospital claimed the coming financial year would be the first time it had not been able to meet required savings.

Angela Pedder, RD&E chief executive, said she was disappointed, and warned that further cuts would be "much more difficult" than in previous years.

'Botched upheaval'

Ben Bradshaw, Labour MP for Exeter, said: "It is extremely worrying that such a high performing and well managed hospital as the RD&E is now in deficit.

"This is a direct result of the government's unwanted, costly and botched upheaval of the NHS.

"It is exacerbated by the fact that hospitals are not properly reimbursed for the cost of treating people in A&E which in Exeter, as elsewhere, has seen a huge growth in demand."

In a statement Monitor, the NHS England and the NHS Trust Development Authority, said the regulator was "aware" of the financial position at Royal Devon and Exeter NHS Foundation Trust.

It said it was now working to ensure the hospital can "continue to provide good quality care for patients at the same time as balancing its books".

The statement said: "Devon has been identified by Monitor as one of eleven financially challenged health economies in England that are to receive expert help with strategic planning in order to secure the services that patients need."

In statement released to the BBC, the RD&E said "this year is the first time the trust has not been able to achieve the required level of saving".

To further reduce costs the hospital aims to minimise waste and sharing resources.

Ms Pedder said the NHS environment is "very challenging" because the hospital needs to balance the delivery of safe care for patients with finances.

Rebecca Harriott, chief officer of Northern, Eastern and Western Devon Clinical Commissioning Group - which is responsible for commissioning health services - said: "We are operating in a difficult financial environment and we need to do things differently."

She said Devon's hospitals are continuing to look at how they can meet increased future demands.