Cash-strapped NHS trust set aside £1m to hire private consultancy company - but true cost is a secret

Calderdale Royal Hospital
Calderdale Royal Hospital

An NHS trust will spend hundreds of thousands of pounds on the services of a private consultancy company brought in to help cut costs.

Calderdale and Huddersfield NHS Foundation Trust has set aside £1m to hire Ernst and Young to draw up a five-year plan to re-organise hospital services.

The trust, which is expected to be more than £25m in deficit by the end of this financial year, revealed the £1m figure in a financial report to its board meeting.

Trust bosses then said the final cost would be “significantly less” than that, but the actual amount was commercially confidential.

The financial report said trust’s total deficit was expected to be £26.21m at the end of 2015-16.

The cost of hiring Ernst and Young was part of £4m of “restructuring costs” included in the overall total.

The report said: “...the forecast also includes an additional £1m restructuring costs in respect of the appointment of Ernst and Young.”

Despite the added cost, the trust was hopefully of achieving its original deficit target of £23.01m.

Calderdale and Huddersfield said Ernst and Young demonstrated the best value for money when the contract was put out to tender.

Keith Griffiths, the trust’s director of finance, said: “While the terms of the contract remain commercially confidential the cost is significantly less than the £1m ceiling for this and will only be made on completion of the plan.

“Ernst and Young’s bid met the requirements and they are supporting both us and our commissioner colleagues in this role to ensure we have sustainable healthcare provision into the future.”

Ernst and Young was hired after the trust was told to bring in “external support” by the health regulator Monitor.

Financial problems led to Calderdale and Huddersfield being in breach of its licence with the regulator and agreeing to a string of undertakings to get back on track.

A Monitor spokeswoman said: “We took action at Calderdale and Huddersfield NHS Foundation Trust in January after finding that the trust could have done more to prevent its financial problems from arising.

“The money the trust plans to save during the year is significantly more than is being spent on this support, and so ultimately the services offer good value for money.”

Plans are being drawn up for a shake-up of hospital services which could see Halifax and Huddersfield served by a single A&E, along with urgent care centres treating less serious problems.

A public consultation by Calderdale and Greater Huddersfield (CCGs) has been delayed until next year.

The five-year plan being drawn up by Ernst and Young is expected to be finished by the end of December.