This story is an interesting one, although this hospital was unrepresentative of NHS hospitals in general. However, it illustrates potential pitfalls with micromanagement by central government, as it was desiret to placate central government, that drove the hospitals management to bad decisions. That said, as is the norm for disasters such as this, the blame cannot be sensibly pointed at one group only - there were failures at a wide range of levels, the extent of which are only now starting to come out of the woodwork.
The primary problem was that this hospital placed achieving 'foundation trust' status above all other goals. Being a foundation trust, means that the hospital gets much more control over its budget and strategic planning - however, a foundation trust must have a clear track record of good performance, and they must prove that they can operate within their budget. The catch was how the performance was measured, central government had prescribed specific targets (e.g. all patients attending the ER must have a decision made about treatment within 4 hours - i.e. they either get admitted into hospital or get sent home) - if all the targets get met, the hospital gets promoted.
It is from the pig-headed stubborness to address targets above all else, that seems to have been the downfall here. The hospital was already short on money, so to save money they started firing front-line staff, or redeploying them. Hence the reason they had receptionists performing triage, a job normally done by a fully qualified nurse. Similarly, there was a pig-headed stubborness to meet the targets at all costs. E.g. the 4 hour waiting time means the time from walking in the door, to either walking out, or getting a hospital bed in the appropriate department. If there is a delay (e.g. because the appropriate department will not be ready for another hour) then a manager would force a decision (e.g. admit the patient to an inappropriate department, and transfer later) which may not always be idea (e.g. it may be better to stay in the ER for another hour, looked after by the same doctor/nurse team, rather than be transferred to a deparment unfamiliar with the condition, only to be transferred later to a 3rd department with a 3rd set of staff).
Other targets too have been unhelpful - e.g. there is a cancer target which specifies maximum time before treatment. It states that if a GP suspects a patient to have cancer, that patient must be formally assessed by a specialist within 2 weeks, have all investigations needed to confirm/refute the diagnosis within 4 weeks and have started treatment within 8 weeks. The problem is that it fails to recognise that not all cancer requires urgent treatment. E.g. there is a very common blood disorder in the elderly called Chronic lymphocytic leukemia. Technically, it is leukemia, a type of cancer. However, this disease occurs virtually only in the elderly (older than 70), causes no symptoms in the early stages (so is often a chance finding on a blood test), takes 10-20 years to progress, and has no treatment except for relief of symptoms. The problem is that hematologists are completly swamped because GPs are forced to make maximum priority referals for every case of CLL, and because the times/dates of the appointments in the clinic are used for the targets, management often will not allow these appointements to be delayed to see urgent non-cancer cases.