A hospitals in Oxfordshire may have to stop paying major suppliers after falling into "dire financial straits", writes Victoria Owen.

The Oxford Radcliffe Hospitals NHS Trust, comprising three Oxford hospitals - the John Radcliffe, Churchill and Radcliffe Infirmary - and The Horton, Banbury, has been told the county health authority will be cutting £2m from its monthly income.

The trust, which recently revealed it had £2.5m debts and £5m of unpaid bills for treating patients, is now taking drastic action by telling suppliers it cannot afford to pay them after February.

Because of its growing debts, the trust relies on the monthly £8m income it receives from Oxfordshire Health Authority. But the authority - which is also suffering cash problems - will be able to give only £6m from March 2000.

Trust finance director Sandy Hogg said: "We're in a terrible situation at the moment. We're trying to get any cash relief we can into the system.

"If we can get a loan, then we wouldn't have to stop paying our suppliers."

Mrs Hogg said the extreme action to stop paying for supplies at the hospitals would not affect medical care.

Only certain companies would be targeted, although she would not reveal which. She said: "We're trying to work out which firms we can stop paying without their supplies stopping.

"We want to reach some kind of agreement so that we can pay them in April - and even pay them interest, if necessary.

"At the moment I just don't have any other answers, so we are in fairly difficult discussions with people outside the trust."

Story date: Wednesday 15 December

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