Wolverhampton's New Cross Hospital going into red to save jobs
Finance bosses at New Cross Hospital are deliberately going into debt – to avoid having to sack staff.
Chief executive David Loughton pledged to protect his staff despite the NHS trust having to save millions of pounds to cope with Government cuts.
He revealed he feared the deficit would have been as high as £30m when contract negotiations started.
But that has been reduced to £2.4m, with Mr Loughton pledging: "We insist on making no cuts whatsoever to our staffing numbers."
The Trust's financial concerns come with the NHS facing a desperate time financially, with 75 per cent of acute trusts forecasting a year end deficit over the next year.
A report states the trust has a legal requirement to break even year on year.
The decision to approve the 'high risk' budget comes as it emerged that Wolverhampton CCG is planning to make £3.9m of cuts to frontline clinical services.
The proposals have put 135 nursing posts in jeopardy, along with the loss of seven-day consultancy posts and the reassigning of ward bosses.
Trust bosses are said to be furious over the proposals, which they say 'fly in the face' of everything the trust is trying to achieve.
Mr Loughton said the level of deficit looked to be in a much worse state earlier in the financial year.
"We are not alone with the financial deficit as at least 60 per cent of the NHS is facing a deficit at the end of the financial year," he said.
"However despite this our financial position is relatively healthy but we have taken the decision to enter a deficit as we insist on making no cuts whatsoever to our staffing numbers.
"In fact we are looking to enhance our staffing levels and that is why we have gone with the deficit for the start of 2015/16."
"When we started contract negotiations we first feared the deficit would be around the £30million figure so to have got it down to £2.4million has been a fantastic effort by our team."
The Department of Health has said it would increase budgets by £2bn next year to help trusts cope with the financial pressures placed on them.
But the Trust says its financial problems have not been helped after an original tariff proposal from NHS England and Monitor was rejected with more than 51 per cent of stakeholders objecting during a consultation process.
A report detailing the financial plans, which the board approved, states the Trust will need to carry out 'further work' to plan more savings.
"This plan is consistent with the principles agreed as part of the Long Term Financial Model updated for the significant financial risks that the Trust is facing," it says.
"Whilst the plan provides an income and expenditure package that enables activity levels and a number of developments to be funded, the Trust will need to identify how it will get back to at least break even to deliver is statutory responsibility and ensure financial sustainability.
"A deficit plan will require the Trust to use its own cash reserves at a time when the capital programme is also using the working capital of the Trust."
