The William Harvey Hospital would be affected by any cuts

The East Kent Hospitals NHS Trust has predicted that NHS reforms could push it into the red by up to �35m next year unless substantial savings are made.

Chief executive David Astley said it was "facing a significant financial challenge in the next year".

The trust is expecting to roughly break even for the 2005/06 financial year.

We've got to respond to the changing environment of the NHS David Astley, East Kent Hospitals NHS Trust

Mr Astley said the health service was experiencing a "pace of change", with greater choice now being offered to patients.

"As a result the competition for scarce health money is greater," he said.

"We are facing a reduction in our income of approaching �20m as a result of the new tariff structure being introduced into the NHS, and that was on top of a challenge we were already aware of, of around �15m for next year."

He said the trust would have to look at every aspect of its operation so that it could work in a better and more efficient way, while still enhancing and protecting patient care.

'Top quality care'

Mr Astley said staff numbers would be looked at but, wherever possible, cuts would come through natural wastage.

In addition, overall bed numbers could be reduced.

"We've got to respond to the changing environment of the NHS," he explained.