IPSWICH Hospital is facing a double blow with its bid for foundation trust status put on hold due to financial problems and the imminent loss of another specialist service.

The hospital trust had been campaigning to secure foundation status – which would give it greater control over its finances and enable it to be more responsive to local needs – but has now been forced to focus on dealing with millions of pounds of debt.

The hospital is also set to lose vascular surgery as patients will be sent to a state-of-the-art regional centre at Colchester Hospital.

Bosses at the trust – which was also criticised by the Care Quality Commission in May over its care of “older” patients – said the decision to defer the foundation trust bid was “an obvious disappointment”.

The trust is facing a budget deficit of about �7million this year and is dealing with �3.7m of historic debt.

Andrew Reed, chief executive, said: “Now our financial recovery plan is in place we need to concentrate our efforts on delivering its expected results and rebuilding the track record on good financial performance that we had developed over the previous five years.

“This will significantly delay our foundation trust (FT) application and the board believes this is therefore the right time to review our longer-term strategy.

“We want to involve as many people as possible in the review and to do it fully will take several months, so we will not be looking to recommence the FT application until late in 2012.

“While this is an obvious disappointment given how close we have been it allows us to concentrate on what’s right and necessary at this time.”

Mr Reed added the trust was still on track to meet the 2014 deadline required of all hospitals to reach foundation status.

Meanwhile, fears have been heightened that the hospital is being “downgraded” with the loss of vascular surgery, which will transfer to Colchester General Hospital.

NHS Suffolk believes that “centralising” the service – which is for complications such as aneurysms – with skilled physicians and state-of-the-art facilities will provide a better service to patients.

But opponents to the move, set to happen in March, have raised fears about greater travel distances for patients and visitors and called the proposals a further blow to the future of Ipswich Hospital, which has already lost specialisms including surgery for head and neck and pancreatic cancers.

NHS Suffolk’s board is being recommended to approve the change, which is being backed by leading clinicians, when it meets next Wednesday after a 12-week “engagement exercise” was carried out.

The Five Rivers Vascular Network, which carried out the consultation, said most vascular patients would not be affected as major vascular surgery is only involved in a “relatively small” number of procedures and that much “mainstream” work would remain unchanged at Ipswich.

But Prue Rush, a health campaigner and former GP nurse, said: “It just feels as though Ipswich Hospital is being downgraded in the services it is able to provide – it means our patients will have to travel further and their visitors will have to travel further.

“The concern is what will be left at Ipswich Hospital for our youth? Unfortunately this decision really doesn’t come as a surprise – you have to wonder what will go next.”

Therese Coffey, MP for Suffolk Coastal, said: “I am disappointed that the consultation did not change the recommendation made in agreement with the hospital doctors to move services further away from Suffolk residents.

“I will be seeking assurances on what safeguards are in place such that constituents are not disadvantaged in terms of healthcare provision or financially.”