Hinchingbrooke losses double Circle Health estimate Published duration 25 October 2012

image caption Hinchingbrooke is the first NHS hospital to be run by a private firm

The first NHS hospital to be run by a private company has revealed losses in the firm's first six months in charge were almost double those forecast.

Circle Health took over management of Hinchingbrooke Hospital in Cambridgeshire in February.

The hospital's board has revealed its £4.1m loss was £2.2m more than it expected to make over the six-month period.

Circle said it would have to pay any deficit at the financial year's end.

The private company said a contributing factor was that it had brought in 10 new consultants as staff, but the pace of their arrival was slower than expected.

As a result, it had had to continue hiring external locum consultants.

Nursing posts cut

Steve Melton, head of mobilisation for Circle, said: "We've made great progress in the quality of care, but the financial transformation is a little bit behind the high ambitions we set at the beginning of the year.

"That will probably mean at the end of the year we will put in money to balance the overall income and expenditure statement for the hospital.

image caption Mr Melton said "great progress" had been made in quality of care

"We're content to invest in the very short term this year to bring the trust into balance by the end of the year and take it into sustainable surplus."

The private enterprise is the first to manage an NHS hospital, with the staff and assets remaining in state control.

The board reported that 46 nursing posts had been cut so far at the Huntingdon hospital under Circle's management.

Karen Webb, regional director for the Royal College of Nursing (RCN) union, said: "The RCN doesn't see how [quality care] can be achieved by removing nurses from the system.

"There does seem to be a clear vision, but there does seem to be a rub between the funding coming through from the NHS and Circle's finances and that should be concerning wherever health care is predicated on funding."

The deal struck by Circle to run the hospital will see it keep the first £2m of any annual surplus it achieves, and a percentage of further profits.