HOSPITAL chiefs have hit back at suggestions they are heading for financial meltdown.

However, Worcestershire Acute Hospitals NHS Trust admits it is coming under big financial pressure and that it could be heading for trouble if nothing is done to turn the situation round.

The trust, which runs Worcestershire Royal Hospital, is struggling to balance its books as it comes to terms with an “unprecedented reduction in income” of about £25 million.

It is already predicting a year-end deficit of £5 million but director of resources Chris Tidman has warned the reality could be much worse if the current financial performance is allowed to continue.

After just four months of the financial year, the trust’s performance is £1.9 million worse than expected – and if that trend continues then it will be staring at a massive year-end deficit of £12 million.

The poor performance is being blamed on the trust not being able to perform enough elective operations – one of its most lucrative sources of income – due to ongoing bed pressures from higher-than-expected numbers of emergency patients.

This under-performance has already cost it more than £1 million, while a 10 per cent drop in births compared to last year is also hitting finances hard.

At a board meeting, trust directors faced accusations from the public of an “abject failure to meet any financial targets” and that its position is “at best difficult, but worst impossible”.

However, chairman Harry Turner defended the trust’s position and said he was certain a recovery plan being put together urgently would turn the situation around.

“As a trust, we have hit all our financial targets since 2007,” he said. “It is challenging and it is going to get more challenging.

“But I really do reject the suggestion that we are a basket case trust financially.

“The financial pressures the NHS faces are not just in Worcester, it is across the country.

“We are talking about a few million pounds. Some trusts are talking about tens of millions. There are chief executives out there who would kill to have these kind of numbers. We have got six months to pull it back and the tone and ambition is that we are going to fix it.”

The planned £5 million deficit arose after the unexpected removal of about £13 million of funding by commissioners earlier this year.

This is on top of the £12 million efficiency savings the trust is already required to make.

Mr Tidman called it an “unprecedented reduction in income” and said: “This is a very challenging financial situation.

“We refute the idea that as a trust we are a failing model. It is true that we, as many other trusts, have faced financial challenges in recent years. But on every occasion we have managed to achieve our statutory duty of breaking even or returning a small surplus.”