If the new Hywel Dda NHS Trust breaks even by the end of the current financial year, debts totalling more than £40 million will be written off.
Welsh Assembly Minister for health and social care, Edwina Hart, announced she is willing to scrap the historic debts inherited by the trust following the merger of Ceredigion, Carmarthenshire and Pembrokeshire and Derwen NHS trusts, if strict financial conditions are met.
Mrs Hart said: “The new merged organisations will mean better care for patients in west Wales and north Wales, with more robust financial management and greater strategic direction.
“However, to ensure that recovering the longstanding debts of these organisations does not affect the quality of service patients receive, I have agreed that these historic debts are cancelled if Hywel Dda NHS Trust breaks even.”
Pembrokeshire and Derwen NHS Trust’s share of the combined debt was £13.5million. Carmarthen-shire’s share was £21.4million and Ceredigion’s was £5.4million.
Hywel Dda NHS Trust chief executive, Martin Turner, said: “We welcome the news that the historic deficits of the former three trusts will be cancelled if the financial targets for the new Hywel Dda NHS Trust are achieved, as this was one of the main concerns of all three former trust boards prior to merger.
“The targets that have been set are challenging, so the trust has established a dedicated team charged with identifying key areas where savings and cost reductions can be achieved through rationalisation and economies of scale without comprising services or patient care.”
