Rachel has hailed the decision to write-off more than £13billion of NHS debt as ‘game-changing.’

NHS trusts, including the Worcestershire Acute Hospitals NHS Trust, have had their historic debt written off as part of a wider package of NHS reforms.

Worcestershire Acute Hospitals NHS Trust has been told the Trust’s debt totalling £321,580,000 has been written off.

This move will allow Trusts to invest in maintaining vital services and longer-term infrastructure improvements.

The decision to write off more than £13billion of debt is part of a package of major reforms to the NHS financial system, designed in a collaboration between the Department of Health and Social Care and NHS England, which will begin from the start of the new financial year.

This package is launched in combination with a simpler internal payment system to help NHS trusts in dealing with the coronavirus (COVID-19) response, which was agreed with NHS England last week.

This significant change will mean hospitals will get all the necessary funding to carry out their emergency response, despite many hospitals cancelling or limiting their usual services such as elective surgery or walk-in clinics due to the virus.

Rachel said: “It’s well known that the debt our local Trust was saddled with was a millstone around its neck. This decision to write off its historic debt is game-changing and will enable the Trust to plan for the future and invest in vital services.

“Along with my fellow Worcestershire MPs, we have been having conversations with the Health Secretary since the beginning of the year on this issue. I’m very pleased the Health Secretary has listened and delivered for our Trust.

“The Government remains committed to providing the NHS with whatever it needs to tackle coronavirus, and the changes to the funding model will give the NHS immediate financial certainty to plan and deliver their emergency response.”

 Under the new rules set out in a letter to all NHS Trusts, should hospitals need extra cash this will be given with equity, rather than needing to borrow from the government and repay a loan.

The letters also include details on every local area’s capital budget for 2020/21, providing certainty to the NHS for the new financial year and enabling investment in vital longer-term infrastructure upgrades as soon as possible.

These budgets come on top of the capital facility the government launched in February to ensure the NHS has access to whatever extra capital investment it needs, without charges, to respond to the COVID-19 outbreak.