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NHS Trusts: Loans

Department of Health and Social Care written question – answered on 11th March 2020.

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Photo of Lord Warner Lord Warner Labour

To ask Her Majesty's Government, further to the remarks by Lord Bethell (HL Deb, cols 248 and 253), whether (1) NHS Trusts with loans will have to repay those loans or service them from the cash figures in the NHS Funding Bill, (2) new loans will be available from those cash figures for Trusts in financial difficulty, and (3) the new financing framework promised for 2020–21 will be published before the start of the financial year.

Photo of Lord Warner Lord Warner Labour

To ask Her Majesty's Government what estimate they have made of the amount of loans to NHS Trusts in financial difficulty at the end of the current financial year.

Photo of Lord Bethell Lord Bethell Lord in Waiting (HM Household) (Whip)

The National Health Service is funded through the NHS funding settlement for finance costs on loans drawn from the Department. Individual trusts are, therefore, expected to finance loan repayments from either their internal resources or surplus cash generated from operating activities. Those cash reserves are ultimately financed by the NHS funding settlement.

Loans are provided to trusts from the Department’s own cash limit set as part of HM Treasury Parliamentary Supply Estimates that are presented to and voted upon by Parliament. The NHS is expected to achieve financial balance within the figures set out in the NHS Funding Bill and that includes covering any deficits associated with loans that have been provided.

As explained in the NHS planning guidance dated January 2020, we are considering whether reforms to the cash regime might be appropriate and will provide further detail on this ahead of 2020-21. The following table shows loans issued to trusts in difficulty in the current financial year until 31 December 2019.

Interim revenue support

Interim capital support

NHS trusts

£830 million

£70 million

NHS foundation trusts

£630 million

£120 million

Total

£1,460 million

£190 million

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