Hospitals across south Essex are to get a major financial boost after having their debt written off by the government.

The chief financial officer at the mid and south Essex trust confirmed hospitals in Essex will benefit from the government’s announcement that it will write off billions of pounds of debt across the NHS.

In total more than £13.4billion will be written off by the government to support hospitals across the country which are struggling to deal with the unprecedented Covid-19 pandemic.

Dawn Scrafield, chief finance officer for Mid and South Essex NHS Foundation Trust, said that this will include all hospitals in south Essex.

She said: “The new NHS debt regime will convert legacy debt for Mid and South Essex NHS Foundation Trust into Public Dividend Capital, which means we will not need to pay back historical debt incurred by Southend , Basildon and Mid Essex hospitals.

“The NHS debt regime requires interest charges to be paid on the loans that needed to be taken out, however this will convert to a dividend payment.”

It is positive news for the hospitals which have been struggling to make ends meet. Southend’s latest accounts show that at the end of March last year it owed the government more than £60million.

Their report stated: “The Trust has significant loans from the Department of Health and Social Care, with £63.1m as at 31 March 2019.

“Of these loans, £30.4m are due for repayment in 2019-20, but are currently being renegotiated with the Department because there is forecast to be insufficient cash to repay what is due within the year.”

Meanwhile, accounts for the Basildon and Thurrock trust show that it owed the Department of Health and Social Care £138million on 31 March 2019.

Following the announcement, Health Secretary Matt Hancock said: “Today’s £13.4 billion debt write off will wipe the slate clean and allow NHS hospitals to plan for the future and invest in vital services.”