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Monitor, the independent regulator of NHS foundation trusts, has found that Derby Hospitals NHS Foundation Trust is in significant breach of its authorisation due to its failure to comply with the following terms:

• its general duty to exercise its functions effectively, efficiently and economically; and
• governance (NHS foundation trust boards must ensure effective leadership and governance).

The decision was based on the Trust’s financial performance and the challenges it is facing to improve its position during the next twelve months. Financial stability is vital to ensure that trusts can continue to meet the needs of patients.

Monitor’s on going scrutiny of the Trust raised concerns about its poor financial performance and future plans to address this. These issues were confirmed by an independent review that Monitor asked the trust to commission. The review indicated that the Trust’s Board does not have a strong enough role in scrutinising financial planning and performance.

Monitor is now requiring the Trust to commission external assurance to ensure that its concerns are addressed. This work will focus on ensuring: 

• a recovery plan which results in a sustainable financial position;
• robust cash forecasting, reporting, and  management; and
• improvements to financial governance.

Monitor will help to shape the scope of this work and will receive direct reports on its results.

Commenting on the announcement, Richard Guest, Monitor Director, said:
"It’s important for patients that the Trust’s Board has an effective plan in place to address our concerns and improve their financial position. That’s why we’ve required extra assurance that the right action is being taken to get the Trust back on track. It’s the Board’s responsibility to provide the leadership to make that happen. We’ll be keeping them under close scrutiny and if we’re not satisfied with their progress, we’ll look again at whether we need to take further action."

Notes

1. For media enquiries please contact Michael Moruzzi:  020 7340 2438 or Michael.moruzzi@monitor-nhsft.gov.uk
2. When a trust is authorised as an NHS foundation trust by Monitor it is required to comply with the terms of its Authorisation. These are published on Monitor’s website.
3. The intensity of our monitoring and the specific requirements we place on boards of foundation trusts reflect the risk of an actual or potential breach of an NHS foundation trust’s terms of authorisation. More information about how Monitor regulates foundation trusts is available here:
   http://www.monitor-nhsft.gov.uk/home/about-monitor/how-we-do-it/how-monitor-regulates-nhs-foundation-trusts
4. Monitor was established in January 2004. It is independent of government and accountable to Parliament. Monitor’s functions and powers are set out in the National Health Service Act 2006.
5. Monitor is now on Twitter - follow us @MonitorUpdate