MONITOR has taken action to improve the financial woes faced by Dudley's hospital trust which is forecasting a deficit of nearly £8million in 2014/15.

The move follows an investigation by the health sector regulator into long waiting times for A&E patients and deteriorating finances at The Dudley Group NHS Foundation Trust.

Trust bosses have since made progress to cut waiting times for patients using A&E.

But Monitor says the Dudley's Group's financial situation has worsened and it has now secured legally binding commitments from the Trust that it will develop and implement a robust strategic plan to address its financial decline and an effective financial recovery plan for breaking even.

Katherine Cawley, Monitor's regional director, said: “The Dudley Group has reduced waiting times for patients in A&E, but it now needs to show a similar focus to address its financial issues.

“Our action is designed to support the Trust’s efforts to balance its books. We want Black Country residents using its services to continue enjoying quality care for the foreseeable future.

“We will continue to monitor the Trust’s progress in achieving this and won’t hesitate to take further action if necessary.”

Dudley Group chief executive Paula Clark said: "We have already begun strict financial controls for vacancies and we are currently beginning workforce reduction plans which will reduce our workforce by 400 posts over the next two years.

"We continue with our turnaround plans which are making efficiencies across the system and are now forecasting £7.5m deficit close to our plan for the year."

She added: "We are pleased Monitor have closed the element of their investigation about the four-hour target to see treat, admit or discharge patients from their arrival in ED due to our improved performance."

She said the Trust was the only one in the Midlands to meet the four-hour A&E waiting target in quarter three (October to December 2014) and she added: "We have seen unprecedented levels of demand on our emergency services since the New Year."

Dudley North MP Ian Austin criticised the government for doing "nothing to support Russells Hall since Monitor announced their investigation half a year ago" and he added: "Now our hospital is being forced to lose one in ten staff to deal with an £8 million deficit this year and further cuts down the line.

“Local people know it’s not possible to lose these jobs without an impact on care."

Mr Austin, who raised the issue in a debate on the NHS in the House of Commons on January 21, is now urging Health Secretary Jeremy Hunt to step in to save jobs at the hospital and give the Trust the resources it needs to maintain standards.