HOSPITAL bosses are struggling to repay a multi-million-pound government loan.

Mike Stevens, director of finance at Worcestershire Acute Hospitals NHS Trust, said the organisation was £2.9 million behind this year in its repayment of the £25 million debt.

The trust, which manages Worcestershire Royal Hospital in Worcester as well as Kidderminster Hospital and the Alexandra in Redditch, should have saved at least £5 million by the end of the financial year in April 2010.

The trust has been paying back the Government loan, which was taken out for XXXXXXX, at a rate of £5 million a year since 2007/08.

The trust has introduced controls on spending but the forecast is to save £4 million at most by the end of the year, at least a million short of the target.

Even if the organisation did manage to save £5 million this year it would still have £10 million to pay over the next two years as part of the five-year payment plan.

John Rostill, chief executive of the trust, has already ruled out job cuts during this financial year to plug the hole, as previously reported in your Worcester News.

Figures show the trust has been overperforming – doing more work than it planned to do such as extra operations and medical procedures – which means it is entitled to extra money following negotiations with NHS Worcestershire, the organisation which holds the purse strings for county healthcare and pays the trust is paid for each patient it sees.

But the benefits of this extra cash are offset by high spending on locum and agency staff to cover shifts.

This cost £1.3 million in October alone, which is described as an “unsustainable” level for the trust.

Health chiefs plan to drive down costs through waiting list initiatives where managers try to make sure patients can be seen during the week so as to avoid paying staff extra to work evenings and weekends.

But waiting list initiatives themselves also cost money and have also been classed as an “unsustainable expense” by the trust.