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Work on the Royal Free Hospital entrance |
Hospital’s funding ‘mess’
BUILDING work on the front of the Royal Free Hospital in Hampstead has been hit by money trouble with the major funders of the scheme describing the situation as a “mess”.
Insiders said the ambitious nature of the project, a complete overhaul of the entrance in Pond Street, has led to spiralling costs and the risk of a shortfall in funds.
The hospital said last night (Wednesday) that it had worked on making savings to ensure the project was funded and that it was still on track to be completed early next year. But the New Journal has learned that last month trustees of the Royal Free Charity, the main source of funds for the scheme, were called to an urgent meeting to discuss cashflow.
Members of the charity were said to be distressed to be told at the meeting with project directors that a funding shortfall of around £560,000 had opened up due to unforeseen costs.
The charity effectively manages all money given as gifts to the hospital. It often uses the money to buy new medical equipment for wards but last year agreed to use its accounts to pay for the hospital’s new entrance.
Days after learning that the scheme was more expensive than first thought, a leading member of the charity sent a sharply worded letter to the management board, a copy of which has been leaked to the New Journal. It warned the hospital that it would need to provide a “detailed audit trail”.
The letter shows that concerns were raised about how spending on the project was authorised, including an outlay of £80,000 desk for a top of the range front desk.
“The scale of the cost of some of the items leads me to feel that the NHS Trust’s ability to procure effectively and reasonably is not of the highest quality,” the charity’s letter said.
It was sent to Dominic Dodd, the hospital’s chairman, and Charles Bruce, the interim chief executive whose short spell in charge ended on Monday when new boss David Sloman began a permanent contract.
The letter added: “Trustees will be very disappointed that whilst some of the work seems marvellous, there are several areas where profligate budgeting or possibly a lack of control seem to have been allowed... You haven’t asked us, and as much more in sorrow than criticism as I know it is often the practice, I would strongly recommend fixed price professional fees in connection with any future capital projects.”
And it warned: “There is a considerable reputational risk were the present mess to be scrutinised by the press.”
Work was continuing on site yesterday and the Royal Free said a new finance plan had been sorted out.
A hospital spokeswoman said: “The Royal Free is unable to comment on private papers that have been leaked, however we would like to take this opportunity to reiterate our profound thanks for the support and generosity of the Royal Free Charity in making our new reception area possible.”
She added: “Our front entrance works are on schedule to be completed early in the new year and are progressing well. The greater part of the overall scheme continues to be funded by the charity, while some elements of the costs of the scheme that were not initially financed will be funded by the Royal Free itself and some savings will be made that will prevent any shortfall.” |
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