NHS trust chief quits over debts

The head of a London health trust has quit after its debts spiralled out of control.

Terry Bamford, chairman of Kensington and Chelsea primary care trust, resigned after it was revealed the organisation was ?14.5 million in the red and unpaid bills had not been fully disclosed. Chief executive Paul Haigh is also leaving the trust and is being moved sideways into a health authority job.

The trust, which oversees GP practices, health centres and dentists in its area, is one of many in London looking at a bleak financial future. The NHS in the capital could be facing debts totalling more than ? 100million. The Kensington and Chelsea crisis means services for 190,000 patients will suffer in a bid to make savings. It is also likely that plans to revamp crumbling GP premises in the area will be delayed.

A damning financial report found the trust board had not scrutinised financial issues and called for a cultural change in the organisation. The Evening Standard revealed earlier this year that there was a ?9million "black hole" in the trust's finances and that it planned sweeping cuts to mental health services, which doctors warned would risk patient safety.

Mr Bamford has now quit after the debts were found to be even higher than the trust had previously admitted. Managers have pulled back from the threatened mental health service cuts and the Audit Commission is investigating.

Auditor PricewaterhouseCoopers found bills owed by the trust worth more than ?8million, which should have been paid by the trust over a year ago, were left out of accounts.

Questions are now being raised over the financial management of the trust and of the Strategic Health Authority, which should have been monitoring it.

Mr Bamford said: "When things go wrong, those at the top of the organisation have to accept responsibility."

He said he will leave as soon as new appointments can be made, adding: "The failure of internal systems, together with the PricewaterhouseCoopers review to identify the scale of unpaid invoices - the largest single element in our deficit - are matters of grave concern. I have drawn these to the attention of the Audit Commission and have asked them to review the situation."

Lise Llewellyn, chief executive of Brent Teaching primary care trust, is extending her role to run Kensington and Chelsea in the short term.

John Lister, of pressure group London Health Emergency, said: "These people have obviously made a spectacular mess of it but they are not the only ones in London. The Government wants ever more services but the trusts have to balance the books. In London there is not enough in the kitty to do everything."

Michael Summers, chairman of the Patients Association, said: "We are concerned that deficits of this magnitude are likely to affect services and patient safety. Cutbacks are the likely consequence such as ward closures and cancelled surgery."

At a board meeting yesterday, Mike Robinson, from PricewaterhouseCoopers, was asked why the company did not identify the problem in 2003/04. He said: "The trust has increased its deficit, which means it spent money beyond the amount given to it by Parliament."

The trust has been given three years to repay the overspend in order to try to minimise the impact on services.