The trust, which runs three hospitals, was losing £1m a week, after two private finance initiatives ended up costing the trust over £61m a year in interest payments.
South London Healthcare’s chief executive was told on Monday night that the trust will most likely be put into the ‘unsustainable providers regime’ which will allow administors to take over from the board and suggest measures to the Health Secretary to put the trust’s finances on a surer footing.
The trust will continue to provide services as normal at its three hospitals: Queen Mary’s in Sidcup, Princess Royal in Bromley, and Queen Elizabeth in Woolwich.
In a letter to the trust’s Chief Executive, Dr Chris Sreather, Heath Secretary Andrew Lansley wrote: “I recognise that South London Healthcare NHS Trust faces deep and long-standing challenges, some of which are not of its own making.
“Nonetheless, there must be a point when these problems, however they have arisen, are tackled. I believe we are almost at this point.
“I have sought to provide NHS organisations with the help and support they need to provide these high quality, sustainable services to their patients, which South London Healthcare NHS Trust stands to benefit from.”
While the performance of the hospitals in the area has improved, its £150m deficit is roughly three times the cost of the PFI charges.