HOSPITALS across the country are running up huge debts despite the billions of pounds of extra funding going into the NHS, figures seen by The Times reveal.

The official government statistics show that at the end of the last financial year, nine hospital trusts had deficits of more than £10 million, 14 had deficits of more than £5 million, and another 39 of more than £1 million.

Overall, almost one third of all NHS trusts were in deficit, with the total standing at more than £350 million. However, experts believe that the situation now might be even worse, with many hospitals having to cancel operations, shed staff and close wards to try to claw back money before this financial year ends.

St George’s and Hammersmith hospitals, in London, have already closed beds, while Leeds Teaching Hospital announced plans to shed 230 beds and four operating theatres.

Airedale trust, which is predicting a £2.9 million deficit, has had to cut some non-urgent surgery while South Tees trust with a debt of £25 million, admitted that it was now increasingly hard to balance the books.

“In recent years we have gone from a situation of being able to balance the books year on year to one where we have to effectively borrow from next year to try and balance this year’s books,” managers wrote in a special staff briefing.

Experts said that the deficits were the result of hospitals expanding too fast to try to cut waiting times. They also overestimated the amount of money that they would get from central government, and underestimated the cost of implementing the new consultants contract.

The disclosure has caused a political storm just a day after Gordon Brown put Labour’s handling of the public services at the heart of its election campaign. “Despite the hard work of NHS staff and billions of pounds worth of taxpayer investment, resources are being wasted and swallowed up by additional bureaucracy and the pursuit of government targets,” Andrew Lansley, the Shadow Health Secretary, said.

“Eight years ago, Mr Blair said it would be ‘24 hours to save the NHS’, but today more than one in three hospitals is in deficit, resulting in closed wards and cancelled operations.”

The Liberal Democrat MP, Edward Davey, who received the figures as part of a parliamentary answer, added: “These startling figures show that Labour has failed to get the extra health cash to the frontline.

“As hospitals struggle to break even, it is operations that are being cancelled and nurse vacancies that are not being filled.”

However, a Labour spokesman said that the deficits needed to be seen within the wider perspective of NHS growth.

“These deficits are a tiny proportion of overall NHS spending. The very worst thing that could happen to the NHS is if we had a Tory government which would immediately take £1.2 billion and use it to subsidise the private medical insurance of the wealthy few.”

The biggest deficit of all was recorded by the North Bristol NHS Trust, at £48.7 million. Royal United Hospitals Bath recorded a deficit of £26.7 million, while Worcestershire Acute Hospitals owed £23.8 million.

Nigel Edwards, of the NHS Confederation, which represents health service managers, said that hospital deficits this year were likely to be higher, but not uniformly. He added that the crisis differed from those in the past, when there was simply not enough money.

“This time it is the result of over-expansion, combined with some fierce cost pressures” he said. “Many hospitals have expanded too fast and got ahead of themselves, while others underestimated the cost of the consultants contract.”

A spokeswoman for North Bristol NHS Trust said: “This is a historical deficit and a permanent solution is being sought.

“In 2003-2004 the trust achieved a break-even position after making savings of £16 million against the previous year’s deficit. This year we plan to deliver a savings plan of more than £19 million. Staff have worked extraordinarily hard to deliver these saving. The number of agency staff shifts has been cut to 200 this year, compared with 5,200 in 2002. Five per cent of services in administrative and corporate departments such as human resources have also been cut.”

The hospital with the second-largest deficit, Royal United Hospitals Bath, said that it hoped to avoid any cuts to pay off the deficit. “The expectation is that this deficit will not need to be repaid,” John Williams, finance director of the trust, said.

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