Record sums of taxpayers' money are being poured into the health service and yet barely a week goes by without another NHS trust in Yorkshire warning that it is deep in the red.

WINTER is always the hardest time for the NHS.

Hospitals and GP surgeries are full to bursting with patients needing treatment just as a traditional panic sets in over soaring costs, which in turn inevitably lead to a programme of cuts. Billions of pounds in taxpayers' cash has been set aside since 2000 to build a health service Ministers hope is comparable with any in the world.

Yet cuts including ward closures, the shutdown of operating theatres and recruitment freezes are still happening across the region.

In fact many of the in-creased costs faced by trusts this year are directly due to the Government's effort to transform the health service.

Nationally-agreed pay deals modernising contracts with rises well above inflation, new systems of payments and targets to reduce waiting times and enhance access to care have put enormous pressure on the NHS.

Taken together with local problems including bad management and legacies of financial debt and poor quality health services, and some trusts – although not most – are plunging deep into the red.

In Yorkshire the worst situation is at the Mid Yorkshire Hospitals NHS Trust. Poor management, a botched merger and historically inadequate hospital and community facilities have contributed to debts so high the Government has written them off in the hope the org-anisation running hospitals in Wakefield, Dewsbury and Pontefract can start again.

In Leeds, hopes that a merger between the city's two big hospitals would create big savings have so far failed to be realised. The trust estimates its costs are as much as £60m higher than comparable hospitals.

Services are duplicated across the city while the way in which care is provided – for instance only 60 per cent of planned surgery is carried out on a day-case basis compared to 75 per cent elsewhere – also increases costs.

This year the situation has been further worsened by the higher-than-expected costs of the consultant contract, which has landed the Leeds trust with a £15m bill, in Hull and Sheffield extra costs of £4m and in Bradford £3m.

A top manager at one of the region's hospitals told the Yorkshire Post costs had been under-estimated by the Department of Health.

"By the time everyone discovered the mistake the money had been allocated," he said.

The crisis in Leeds has prompted deep short-term cuts in the face of protests that patient care will suffer.

Debts have been partly offset in a £8.8m deal brokered by the city's MPs with the Department, although the trust still predicts it will be at least £7m in the red.

The impact of a national pay deal for GPs has also hit primary care trusts (PCTs), which commission and pay for health services.

Under the contract doctors are paid more if they provide higher quality care. PCTs were told they would be fully funded according to a formula which assumed their GPs offered an average service but in many areas family doctors are providing significantly better care.

Philip Grant, financial director at the Selby and York PCT, which is expected to be £6.4m in the red by the end of March, said: "That's good news for patients but unfortunately we have to pay for that.

"We are over £1m short of how much it's costing us to implement the contract locally."

The trust has also been hit by a rise in emergency admissions to hospital. Instead of the two per cent increase expected, levels of admissions have been running 14 per cent higher this year – equivalent to some 3,000 additional patients – at a cost well above £1m.

The rise has come as hospitals operate a new system known as payment-by-results which means they can earn up to £1,200 a time for an emergency admission.

Many PCTs have voiced suspicions hospitals are deliberately admitting more patients to earn extra cash under the system, which one manager describes as creating "perverse incentives".

This was a major factor in the crisis at the foundation trust in Bradford after one of the city's PCTs refused to pay a bill for several million pounds.

The new system seriously destabilised hospitals like Bradford – previously regarded as trailblazers in NHS reforms – prompting Ministers to announce earlier this month that its planned expansion was being scaled back.

In East Yorkshire auditors have described the Yorkshire Wolds and Coast PCT, which covers Driffield, Bridlington and Withernsea, as in an "extremely perilous" position with debts of £6.25m.

Among the factors are unexpectedly high levels of hospital referrals, which have shot up 16 per cent over the last four years in part due to Government waiting time targets.

Duncan Ross, the trust's director of planning and performance, said patients knew for the first time there was a maximum wait for treatment and this had increased demand.

The trust is now exploring approaches to reduce expensive referrals for hospital care and in particular is looking to local alternatives provided by GPs, who are now rewarded for improving services under their new contract.

In Hull, where the hospital trust is predicted to be £4.5m in debt for the first time since it was founded in 1999, outsourcing of work to the private sector to meet Government targets has had a destabilising effect.

This pressure will intensify later this year when patients are offered a choice of four or five hospitals for surgery under a new national policy.

One Yorkshire trust official said nationally-negotiated deals often failed to take into account "varying impacts at a local level" which could undermine services. Patient choice has led to concerns hospitals losing out on treatment contracts could lose huge sums, leading to the closure of departments. In the worst cases they could even go bust.

Winter will soon be over – but it seems the financial problems facing the NHS will not.

mike.waites@ypn.co.uk