Hospital’s deficit has now exceeded £12 million — and bosses expect the debt to increase further.

The hospital was in the red by £12.4 million at the end of the November and the debt is now said to be even worse than predicted.

In October bosses at the cash-strapped hospital said the debt had reached almost £8 million and feared it would reach more than £12 million by the end of the financial year in March.

Chairman David Wakefield, pictured, said people need to know that the financial situation at the hospital is improving.

Mr Wakefield said: “We are now in a deficit of £12.4 million. The deficit will get worse because it has to, but the rate of spending is getting better.

“People need to recognise that we aren’t sitting on our hands. It’s moving in the right direction.

“I am expecting it to be worse in December, 2012, as there were fewer working days in the month as elective patients didn’t come in, so we will have less income.

“Every year we plan for a loss in December so people should not be surprised.”

He assured members at the council of governors meeting at the Royal Bolton Hospital’s education centre on Thursday that management was working to solve the problem.

The hospital has already been given an £8.3 million hand-out by the Department of Health, which was expected to last until the end of December.

The deficit is the worst reported by the hospital in the last decade.

In 2004, the Royal Bolton Hospital was £3.7 million in debt and in 2006, the trust had a deficit of £6.4 million.

Health watchdog Monitor intervened last year and told hospital chiefs to appoint a turnaround director and external advisers to create a “robust recovery plan”.

Shortly after the watchdog’s intervention it was announced an internal investigation was under way after it was found that £3.8 million was unaccounted for.

Cllr Andy Morgan, who sits on Bolton Council’s health, overview and scrutiny committee, said: “It seems it is moving in the right direction, but there’s obviously a lot of work to be done.

“You would hope theywould find it through efficiency and management strategies, rather than losing staff.

“The last resort is to reduce staff particularly frontline staff, such as nurses.”

The hospital has announced that it is axing 500 jobs, and top consultants have been asked to sacrifice some of their pay.