The amount paid out for clinical compensation claims by Colchester Hospital University NHS Foundation Trust topped £4million last year.

According to figures from the NHS Litigation Authority, £4.35m was paid to claimants during the financial year 2012/13 – a figure that rose to £6.6m if legal costs are included.

But the amount represents a drop of almost £2m in compensation payouts over the past two years. While during 2011/12, payouts were just over £5m, in 2010/11 more than £6m was paid out.

The trust, which runs Colchester General Hospital and Essex County Hospital, says the payouts relate to a “tiny minority” of patients and that the vast majority of people treated at the hospitals leave satisfied with the care they have received.

However, patient representatives say improving the way initial complaints are dealt with could stop some cases escalating into compensation claims.

Alan Bishop, who along with his wife Judy, works as a volunteer patient representative at Colchester General. He is part of a working group currently looking at how the hospital’s complaint procedure can be improved.

He said; “The hospital can ill afford to keep spending out on these claims. The money could be better spent paying for more staff or improving facilities. The way complaints are dealt with and taken forward could prevent them from escalating and becoming a financial cost to the hospital.”

These thoughts were echoed by MP for Harwich and North Essex, Bernard Jenkin, who added: “The burden of paying compensation is a huge and growing problem across the whole of the health service.

“There is both a moral and financial incentive to get things right first time. Dealing with complaints swiftly and effectively will help to reduce this cost.”

In response, a spokesman for the trust admitted mistakes were sometimes made. He said: “Each year we see hundreds of thousands of patients and the vast majority regard the care they receive as excellent or good.

“Few, if any, private companies achieve the same levels of ‘customer satisfaction’ as the National Health Service. However, in a tiny minority of cases we do make mistakes. In these circumstances, we are open and admit that we are at fault, apologise and take steps to minimise the same mistakes happening in the future.

“With obstetric cases, compensation is often paid out many years after the mistake is made so some of the compensation payments made in recent years related to mistakes made in the 1990s.

“In some cases, it is cheaper to pay out compensation without admitting liability than to spend considerable sums of money on a protracted legal tussle.

“This trust’s key priorities continue to be patient safety and to improve the patient experience. We are focused on working to reduce mistakes and, as far as humanly possible, eliminating them altogether.”

A spokesman for the NHS Litigation Authority added: “The payments relate to the claims received by a trust and the subsequent awards to claimants set by the courts or through local resolution and settlement agreements.

“There is an average time of two and a half years before a claim is made to the NHS Litigation Authority. This means that claims do not necessarily relate to the year in which a payment has been made to a claimant.”