THE spiralling cash crisis in the NHS has already forced two thirds of hospitals to close wards and will soon start directly affecting patient care, health chiefs give warning today.

A survey of 117 chief executives of NHS trusts reveals the depth of concern among healthcare professionals about the destabilising impact of wide-ranging government reforms. Three quarters of them say that growing financial pressures brought on by primary and acute care restructuring will affect patient treatment.

Almost half of hospital trust managers said that building and refurbishment projects were being delayed, while many trusts were also having to make staff redundant and to introduce recruitment freezes.

The Times understands that the Prime Minister is to order a shake-up of ministers and top civil servants, such is the concern in Downing Street about perceived NHS disarray. It follows six years of unprecedented rises in NHS funding.

Mr Blair wants a new junior minister to fend off criticism of the Government’s faltering reform programme and to sell NHS modernisation both to the public and Labour MPs. The health service is braced for even starker financial shortfalls from 2008, when the current round of annual funding increases will stop.

The poll of trust executives, conducted by Health Service Journal, comes as nursing leaders also give a bleak warning of massive NHS deficits. Their research suggests that health service debts in England will hit £1.2 billion this year, putting up to 4,000 jobs at risk.

The new minister, who will be charged with promoting the reform agenda in the media, is expected to be imposed on the Department of Health in a reshuffle due within days. The jobs of Jane Kennedy, the Minister for quality and patient safety, and Rosie Winterton, the Minister for health services, are both at risk.

The Times understands that a number of senior bureaucrats will also be moved in an attempt to speed up the pace of delivery.

It is hoped that the MP will be a more effective deputy to Patricia Hewitt, the Health Secretary, who has struggled to explain the benefits of reforms and had to revise plans to reform primary care trusts. The uncertainty surrounding unforeseen knock-on effects of the Government’s reforms emerged when ministers decided to review the £1.2 billion redevelopment of Barts and the Royal London hospitals.

The last-minute decision, taken after more than six years of project planning, prompted 1,000 doctors to write to The Times earlier this week. They gave warning of the serious impact on cancer and cardiac services for London if the project was downscaled.

Evidence of serious financial problems is supported by 75 per cent of hospital chief executives who said that patient care would be affected by cash shortfalls. The warning comes despite assurances from Ms Hewitt that any cuts should only affect administration.

The Royal College of Nursing (RCN), which has been tracking the level of deficits and the impact on staff and services during 2005, confirmed that patient services and treatments were now being disrupted. It found that cost-cutting measures — including freezing job vacancies and use of agency staff — were now having a “direct and detrimental” effect on patients, with operations cancelled, appointments postponed and beds closed.

According to documents obtained under the Freedom of Information Act, a total of 81 NHS trusts in financial difficulties have been investigated by KPMG, the acountant. This is far more than the Department of Health acknowledged when it announced the “turnaround teams” of accountants before Christmas. It said that 50 trusts with financial problems would be visited.

The disclosure, and the full list of trusts visited, was obtained by Accountancy Age. They include 20 out of the total of 28 strategic health authorities, 29 primary care trusts, and 33 hospital trusts.

A Department of Health spokeswoman last night defended the NHS reform programme.

She said that the RCN’s predictions were “back of-an-envelope calculations”, adding that the “turnaround teams” would help to address financial problems centred on a small number of trusts.

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