HINCHINGBROOKE Hospital’s new managers will have saved the NHS £20million before they take a penny from the franchise, they stressed today.

And, when they do start to make a surplus, it will be shared with their colleagues at the hospital.

Details of Circle's profit-sharing arrangement emerged in a letter deposited in the House of Commons library by junior health Minister Earl Howe include the company banking the first £2m of any operating surplus and sharing anything beyond that with the NHS.

The letter says the £100m-a-year hospital would have to make surpluses totalling £70m over the 10-year term of the management franchise to clear the accumulated £39m "debt".

But Circle pointed out that, not only had it agreed not to take a share of any surplus in the current year, but the hospital was forecast to make a £10m loss this year and next.

"So until we have saved the taxpayer £20m we shall not see a penny of any surplus," a spokesman said. "And, when we do, we shall share it with the local staff. Nor do we plan to slash jobs to achieve it."

Chief executive Ali Parsa said today: "Hinchingbrooke was projected to lose many tens of millions in the years ahead, and faced closure.

"Instead, by putting a partnership of healthcare professionals in charge, Hinchingbrooke is being transformed into one of the best district general hospitals in the country.

"Already, it has gone from having the worst to the best A&E in the region; patient safety has improved by over 70 per cent, and cancer targets have been met for the first time in months.

"The big news is Hinchingbrooke's proof that there's an alternative to cuts and closure for struggling NHS hospitals across the country. Today is a day to celebrate that an NHS hospital has been saved."

Just three months after taking over Circle points to progress it has already achieved with its philosophy of empowering doctors and other clinical staff to fix problems without engaging bureaucracy.

The hospital has gone from worst-performing to top-performing A&E department in Cambridgeshire for treating patients within four hours, the national target.

Doctors now make up more than 80 per cent of the hospital's board.

The orthopaedics clinical unit has reduced the average length of stay for hips and knees from 5.6 days to 3.5 days and produced annualised efficiency gains of £1.5m.

Cancer targets have been met for the first time in many months.

£1.5m of procurement savings have been identified, and £1.2m are currently being delivered.

The number of serious patient incidents was halved in the first month and was down by almost three-quarters by last month.

Car park fines have been scrapped, frozen food abandoned in favour of fresh, with 95 per cent being locally-sourced.