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Apr 2020

Last Updated: 09/04/2020

Health

Harrogate hospital has £4.8 million debt written off

by Connor

| 09 Apr, 2020

Harrogate District Hospital bosses have welcomed the government's decision to write off its £4.8 million debt.

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Harrogate District Hospital bosses have welcomed the government's decision to write off its £4.8 million debt.

The hospital took out the multi-million-pound loan to pay back its suppliers more quickly but said the "reset of finances" was helpful going forward.

107 hospital trusts have an average of £100 million in revenue debt, with the two trusts with the highest debts reaching a combined total of over £1 billion.

In total, the government will write off £13.4 billion of NHS debt to ensure hospitals have the "necessary funding and support to respond to coronavirus."

Under new rules, hospitals in need of extra cash will be given it with equity, rather than needing to borrow from the government and repay a loan.

Jonathan Coulter, finance director at Harrogate and District NHS Foundation Trust, said:

"The loan we took out was to enable us to be able to pay our suppliers more quickly. In line with the rest of the NHS, we think this ‘reset’ of finances is helpful for trusts both at this point in time and going forward over the coming years."

The government has said that while many NHS trusts manage strong finances, some took out loans to plug financial gaps in their day-to-day revenue or capital infrastructure budgets.

Health Secretary Matt Hancock said:

"As we tackle this crisis, nobody in our health service should be distracted by their hospital’s past finances. Today’s £13.4 billion debt write off will wipe the slate clean and allow NHS hospitals to plan for the future and invest in vital services."