HEALTH chiefs have warned that East Lancashire's hospitals are in a "serious financial crisis" that could harm health care in the area.

East Lancashire Hospitals NHS Trust are heading for a £5.5million debt - despite bringing in a series of cutbacks designed to reduce a huge deficit.

And today health leaders and union chiefs admitted if they did not find a solution to the debt problem, patients could end up receiving lower quality care than in other areas of the county.

Richard Gildert, acting chief executive for East Lancashire Hospitals NHS Trust, said: "These are trying times and we are all working together to find solutions - but our priority remains offering high-quality patient care."

The news has led to one MP calling on the Government to step in and rescue East Lancashire's hospitals from their £5million debt nightmare before cuts begin to affect patients.

Nigel Evans' impassioned plea came after the Trust revealed that not only would it fail to meet the target of breaking even this year, but would probably be in more debt than ever.

At the end of the Trust's first year of operating following the merger of the Burnley and Blackburn NHS Trusts, the authority had overspent by £3.9million.

Bosses then pledged a series of cuts would ensure they broke even and put them back on track, but less than five months into their second financial year, they've admitted they are on course to being £5.5million overspent by next March.

Not only have departments not met their targeted cuts, they've actually overspent on budgets - mainly because they are seeing more patients than they had expected to.

Unions are warning the deficit - described as a 'serious financial crisis' by David Meakin, the Trust's director of finance - threatens the hospitals' long-term prospect thanks to the Government's new 'two tier' NHS proposals.

Under the scheme, hospitals which top-score in annual assessments with three stars get the chance to become Foundation Hospitals, giving them extra cash and more freedom to specialise in certain areas.

East Lancashire Hospitals NHS Trust currently has two stars, having failed the financial part of the assessment last time. It is set to fail it again if the budget problem is not resolved, scuppering hopes of it becoming a three-star trust. In the meantime, Chorley-based Lancashire Teaching Hospitals NHS Trust is bidding for foundation status, and unions say the lure of working for a nearby trust with better facilities and better pay deals may tempt East Lancashire's staff away.

Talks are now ongoing with both the SHA and East Lancashire's three primary care trusts - which buy services for patients from the hospitals - about getting extra money.

But Ribble Valley MP Mr Evans said: "The Government needs to act now and get on board with our hospitals and give them the money to get them out of this hole.

"East Lancashire suffers from poor health generally and it should be no surprise that it needs extra cash. If this is allowed to continue, cuts will inevitably affect patient care, and even more so if hospitals elsewhere get extra cash to buy better equipment."

Mr Meakin told a meeting of the Trust's board the problem was a 'serious financial crisis' and said: "Talks are now ongoing with the SHA and with the local PCTs. We had aimed to break even, but it is important to flag this problem up early. Work still continues to establish how the balance can be achieved."

Christine Kirk, chairman of the board, has already expressed concern at the implications of the new foundation status for hospitals left behind.

And a spokesman for Unison said: "Hospitals not allowed foundation status will be left behind and the money will be pumped into the hospitals doing well.

"It creates a two-tier NHS which isn't fair for those people who end up in the hospitals left behind."

New measures for saving cash include reducing the amount of prescription drugs issued at out-patients clinics.

Often, they can also be prescribed by GPs, and if that happens, it takes the cost of the drugs off the hospitals' bill.

A review of junior doctor appointments is on-going, while the use of agency staff will also be reduced.

Use of 'consumable' goods in operating theatres is also being monitored.