High-performing Cornwall set to bail out struggling health care providers

Cornwall Council may use new financial freedoms gained from
performing well under the comprehensive performance assessment to
lend £8m to five local health care providers with debts of
£27m.

The three-star local authority has been approached for help by the
Central Cornwall primary care trust, Cornwall Partnership NHS
trust, North and East Cornwall primary care trust, Royal Cornwall
Hospitals NHS trust and West of Cornwall primary care trust. The
strategic health authority has backed the trusts’ move.

A council spokesperson said the proposal would go before the local
authority’s scrutiny committee and its executive this week and the
full council next week.

If agreed, the £8m loan over 2003-4 and 2004-5 will be repaid
between 2006 and 2009.

A report to the council’s executive says the funding would be made
available from reserves that are not required for the next three
years.

“It is not money that we are diverting from service delivery,” it
emphasises.

The report says offering financial assistance is “a low risk” for
the authority. But if help were not made available there could be
“cuts in key and essential health services, the risk of which would
be the extreme end of high”.

A spokesperson for the Royal Cornwall Hospitals NHS trust said it
was “logical” for Cornwall’s health organisations to approach the
council because of the good partnership they had developed.

The Local Government Information Unit said it supported the
proposed loans. A spokesperson said it was up to Cornwall “to
answer to its own electors” rather than be told by the government
what it can and cannot do with its resources.

“We are in favour of more power and discretion for local government
rather than having to answer to Whitehall.”

The Local Government Association welcomed councils taking
innovative approaches to partnership working. A spokesperson said:
“Cornwall has been rated as excellent and should have the freedom
to do what it feels best suits the needs of its community.”