A special administrators appointed by the Health Secretary Andrew Lansley is set to take charge of the troubled South London Healthcare NHS Trust, which is losing £ 1million a week.

The trust, which runs Queen Mary Hospital in Sidcup, the Queen Elizabeth Hospital in Woolwich and the Princess Royal Hospital in Bromley, will be taken over by a special administrator having powers to sack staff and reduce services at the units aimed at cutting costs.

This is the first case in which, the powers have been used by the authorities and is likely to result in reductions in staff and services. The trust has run into a huge debt problem following two large PFI deals that costs £61m in interest payments a year.

The announcement of takeover by the administrator comes just days after trust’s chief executive Dr Chris Streather announced his resignation. The trust has run up deficits of more than £150m since being created in 2009.

Mr Lansley worte in the letter that, “A central objective for all providers is to ensure they deliver high quality services to patients that are clinically and financially sustainable for the long term. I recognise that South London Healthcare NHS Trust faces deep and longstanding challenges [but] there must be a point when these problems, however they have arisen, are tackled.”