PLANS to build a new Malvern hospital at Seaford Court are under threat after the revelation that South Worcestershire's health authority is £5 million in the red.

Campaigners who had been expecting approval for the new hospital at a meeting on December 4 are furious their long fight to replace the outdated hospital in Lansdowne Crescent may be lost.

The South Worcestershire Primary Care Trust (PCT) has launched a review of all its services after an audit highlighted a projected overspend of £5 million by the end of the year.

The trust's chief executive Mike Ridley admitted the review would delay the decision on the Malvern project, aimed at taking pressure off staff working with inadequate facilities at Malvern Community Hospital.

"It will have some effect," Mr Ridley said. "I suspect we won't able to say it (the hospital) will be going ahead, but equally we won't be saying it won't be going ahead. I think that there are one or two issues to be resolved relating to the funding."

The review is not due to be completed until February 5 next year.

Plans for a new hospital have been touted since 1980 when Seaford Court on Worcester Road was purchased for that purpose by the health authority.

Subsequent attempts to sell the site for housing were foiled by Malvern Hills District Council and it still appears in the business plan inherited by the PCT as the site for a new hospital.

Pat Merrick, chairman of the Friends of Malvern Hospital, said she felt totally let down by the further delay.

"We work so hard and get so far and then there's this stop," she said.

"It just hasn't happened. Everyone knows we need it, except apparently the PCT," she said.

Mrs Merrick said the longer a decision was left, the more expensive the project would become.

"I think the people of Malvern are being very badly treated, it's a mess," she said.

West Worcestershire MP Sir Michael Spicer said the apparent mismanagement of the PCT's budget was bad news in itself.

"It is, however, absolutely no reason for delaying decisions about long term investment, especially one that has been ready to go for as long as has the new community hospital in Malvern," he said. "Private Finance Initiative funding would have very little impact on immediate budgets.

"Malvern has required a new hospital for many years. The land is available, the authorities should stop procrastinating and have the courage to give the project the go ahead."