Three major acute NHS trusts in Devon have been placed under formal spending controls after all three declared they expect to operate in deficit during the 2026–27 financial year. The Cornwall and Devon Integrated Care Board has issued standardised directives to each trust, covering procurement, staffing costs, and the use of external services.

Royal Devon University Healthcare, Torbay and South Devon, and University Hospitals Plymouth have all projected a deficit for the current year. Cornwall and Devon Integrated Care Board interim chief executive Mark Hackett wrote to the chief executives of all three trusts, setting out a uniform set of spending restrictions.

The measures bar trusts from purchasing non-clinical goods, including office furniture, stationery, and IT hardware. A freeze on non-clinical hiring has been introduced alongside requirements to permanently reduce staffing cost pressures. The controls also bring a near-complete halt to both insourced and outsourced services, with operational costs required to remain within existing internal limits.

Hackett joined as interim cluster chief executive in March 2026 and leads both the Cornwall and Devon ICBs as a single South West Peninsula cluster during a period of significant structural realignment across the two systems.

The directives follow NHS England's rejection of the financial plans submitted by the three trusts. Central regulators had granted extended deadlines for providers to revise their submissions and present scenarios for breaking even, but all three institutions continued to anticipate losses. Chief executives of the affected trusts were subsequently required to attend high-level meetings in London with NHS England chief executive Sir Jim Mackey.

The scale of financial difficulty in Devon is considerable. University Hospitals Plymouth, which employs around 11,000 people, has been working to cut £67 million from its budget, following £56 million of savings achieved the previous year. Torbay and South Devon committed to cutting £40 million in the same period, while Royal Devon University Healthcare indicated it would pursue significant savings, though its final figures were still being confirmed at the time.

The problems facing the South West form part of a broader national pattern. Sir Jim Mackey has said that every integrated care board except one submitted a balanced plan for 2026-27, with around ten providers contributing to a total planned deficit of roughly £420 million. Separately, 16 NHS trusts across England are understood to have submitted financial plans for the year that fail to meet compliance standards.

The wider financial picture across NHS trusts remains uneven. In 2024–25, NHS trusts were collectively in deficit by £0.78 billion, with 69 per cent of acute trusts finishing the year in the red.

NHS England's monthly financial data showed that 14 systems were no longer expected to deliver their financial plans for 2025–26, with system overspends reaching £428 million by month ten of the year, a figure that reflects the impact of withheld deficit support funding.

The financial rules introduced for 2026–27 make explicit the consequences of non-delivery. All ICBs and NHS trusts are expected to submit plans meeting required revenue plan limits, with deficit support funding made available to help organisations reach breakeven. That support is set to reduce over the planning period, with all providers expected to operate at breakeven without central subsidy.

For the three Devon trusts, the immediate priority is demonstrating compliance with the spending controls now in place. Whether those restrictions can reverse trajectories that have persisted across multiple financial years remains the central question facing both local and national NHS leadership.

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