THE trust that runs York Hospital has had more than £32 million worth of debt written-off following an announcement by the health secretary.

From the start of this month, £1.3 billion of NHS debt across 16 NHS Trusts in Yorkshire and the North East will be scrapped - with York Teaching Hospital NHS Foundation Trust, which runs York Hospital and Scarborough Hospital, having £32 million of debt wiped.

The decision is part of the £13.4 billion national debt write off announced by Health Secretary Matt Hancock last week.

It is also part of a package of major reforms to the NHS financial system, designed in a collaboration between the Department of Health and NHS England, which will begin from the start of the new financial year.

The Government says the changes will provide financial support during the coronavirus pandemic, as well as setting foundations for the longer-term commitments set out last year to support the NHS to become more financially sustainable.

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 trusts needing to borrow from the government and repay a loan.

Mr Hancock said: “As we tackle this crisis, nobody in our health service should be distracted by their hospital’s past finances.

“Today I’m pleased to confirm the value of this package for the North East and Yorkshire. This £1.3 billion debt write off will wipe the slate clean and allow NHS hospitals to plan for the future and invest in vital services.”

Under the existing rules, some NHS trusts took out loans to plug financial gaps in their day-to-day (revenue) or capital (infrastructure) budgets.

More than 100 trusts have an average of £100 million revenue debt each, with the two trusts with the highest debts reaching a combined total of over £1 billion.

For hospitals in the North East and Yorkshire, this means writing off around £1.4 billion revenue debt and £132 million capital debt.

NHS chief executive, Sir Simon Stevens, said: “This move will put NHS hospitals, mental health and community services in a stronger position.”

The Press asked York Teaching Hospital NHS Foundation Trust for a comment.