Bosses at Worcestershire Acute Hospitals NHS Trusts - which runs the Alexandra Hospital in Redditch, Kidderminster Treatment Centre and Worcestershire Royal Hospital, in Worcester - yesterday announced 720 job cuts as part of an attempt to save more than #30 million.

The losses, which will include medical posts, represent 15 per cent of its 4,500-strong workforce.

Along with other measures, the trust has identified savings of #18.7 million for this financial year, still leaving a funding gap of #12.7 million.

Seventy nurses' posts had already been earmarked to go in its ongoing Clincal Services Review but a further 650 are expected to go from all sectors at the three sites.

An email was sent to all staff yesterday as board members met to discuss the proposals, which were approved.

A 90-day consultation exercise, to identify where cuts can be made, will begin today as hospital workers meet management.

Chairman Michael O'Riordan said the trust faced its most challenging financial year to date.

"It looks as if we have ended 2005/06 with an overspend of around #5.5 million, which is very disappointing but far more serious is a massive and unprecedented shortfall between what we expect to get paid in 2006/07 and what we know it would cost us to provide our services in the way we currently do," he said.

"Even allowing for an extra #10 million income which we expect to come in this year, we have a funding gap of around #30 million.

"With an annual turnover of #250 million, that is not a gap that we can close without considerable pain."

The job cuts will help the trust save #16 million over next two years.

Already 100 vacancies have been frozen, and it is hoped some jobs will go through natural wastage.

Chief executive John Rostill said: "We will be seeking voluntary redundancies but we don't think we will be able to avoid compulsory redundancies.

"We're in no different a position to other NHS organisations that have already announced job cuts to make savings.

"We've been following Government policies in terms of taking on more doctors and nurses, improving waiting times, cancer services, but various changes have occurred and we can't carry on like that and stay in financial balance."