The move by Oxfordshire Mental Healthcare NHS Trust is an indication of the extreme financial pressures being experienced by many parts of the health service despite several years of the most generous financial settlements it has ever enjoyed.

The trust is not itself in deficit and won three stars in the most recent set of ratings issued by the Healthcare Commission. But it has been told to find efficiency savings of £3.3 million a year; has lost £1 million from the primary care trusts it serves; and has been asked to find another £1.65 million by Thames Valley Strategic Health Authority (SHA) to help other trusts in the area to balance their books.

Faced with this final demand, the trust announced last week that seven consultants, seven senior house officers and one specialist registrar could lose their jobs.

The British Medical Association stepped in to try to prevent the redundancies and has been in discussion with the SHA.

Jonathan Fielden, deputy chairman of the BMA consultants’ committee, said: “We have been saying for months that redundancies among medical staff were a risk. This is the first time it has actually been threatened.

“As far as we are aware, the last time consultant redundancies were threatened in the NHS was over the Tomlinson report into hospital provision and medical training in London, and that was more than ten years ago.”

If implemented, the cuts at Oxfordshire Mental Healthcare Trust, which runs the Warneford Hospital in Headington, Littlemore Mental Health Centre, Park Hospital for Children and three other centres, would reduced its medical staff by 20 per cent.

The announcement came as trusts across the country made plans to shed hundreds of jobs because of NHS cash problems. Despite the Government spending billions more on the service, some trusts have substantial debts, running collectively into hundreds of millions of pounds.

Others are in surplus. Normally cash is shifted around from trust to trust to help to balance everybody’s books. In this case, the Oxfordshire trust — which has broken even for the past five years — said that if required to find the £1.65 million the SHA was demanding it could do so only by cutting jobs.

The trust and Dr Fielden are hopeful that a settlement that would not involve redundancies is still possible. “But the threat is still there,” he said yesterday. “It validates what we have been saying for months.

“The news we are hearing from around the country is that the axe is being sharpened and many more jobs will go either directly or indirectly.

“A lot of trusts are planning to make redundancies by stealth. They will avoid direct redundancies where they can. Oxfordshire Mental Health Trust is one of many that is having its bank balances raided to help those trusts that are in deep debt, some to the tune of tens of millions of pounds.”

He said that it was sad that psychiatric jobs were under threat, as patients with mental illnesses were often the most vulnerable in society and would undoubtedly suffer if doctors lost their jobs.

“We already have a consultant psychiatrist vacancy rate of 10 per cent in the NHS and we can ill afford to lose more consultants,” he said.

The trust said yesterday: “It’s disappointing. Referrals to the acute sector are increasing, so unless we can moderate that or put a cap on it, the implications for services like ours are fairly grave.”

Shortages of cash are being felt in other ways. As many as three quarters of this year’s 2,200 university graduates in physiotherapy may be unable to find jobs in the NHS. Physiotherapists have their three-year courses paid for by the NHS at a cost of £25,000. They have now discovered that cash- strapped trusts cannot afford to employ them.

Graham Pope, chair of the council of the Chartered Society of Physiotherapists, said: “It’s a crazy situation when you think that the health services has already paid £30 million to £40 million to see these people through university and can’t now afford to employ them.”

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