Update: New comment from trust. The planned redevelopment of St Helier Hospital is still at risk, the hospital trust's chief executive has warned.

The trust is due to receive £219m to upgrade St Helier Hospital in Sutton and the investment was confirmed as safe in the Government's Comprehensive Spending Review last month.

However, Samantha Jones, the chief executive of the Epsom and St Helier NHS Trust, has issued a warning to staff that if the trust fails to make £30m of cuts, the redevelopment of the hospital could be in jeopardy.

She said: “Our most recent forecast predicts that we will achieve just over £10m of savings for the year, missing our target by £20m.

“Failing to meet our savings target this year will have a massive impact on the future of the trust, including our ability to become an NHS foundation trust. It could also jeopardise our plans to spend millions of pounds redeveloping both St Helier and Epsom hospitals.”

A spokesman for the trust said it was unlikely the investment would be lost but it could be questioned if the trust cannot show sound financial management.

He said: “It is something we are determined to avoid.”

Geoff Martin, Chairman of NHS pressure group Health Emergency, said: “Epsom and St Helier is one of only a tiny handful of hospital developments supposed to have escaped the cuts axe, the news that it is now under threat is a massive dent to credibility of the Chancellor George Osborne.

“Epsom and St Helier, like NHS Trusts across the UK, is gripped by a funding crisis that makes a nonsense of Government claims that the NHS is immune from the cuts.”

But MP for Carshalton and Wallington, Tom Brake, said he does not believe the funding in under threat. He said: "There would have to be an absolute calamity for the development to be under threat and there is no evidence, in my view, that is about to arise."

Samantha Jones, Chief executive of Epsom and St Helier University Hospitals NHS Trust said:   "We have made absolutely no secret of the fact that, like other hospitals in London and across the country, we need to improve the efficiency of our services.  Not only does this help save money, but it's better for patients, for example by speeding up their treatment.   "It's going to be tough, but we have a good track record of delivery, balancing our books for the last three years.    "I am confident that we will be able to do it again this year and that our plans to spend £219 million redeveloping St Helier Hospital will not be affected.   "One example of where we have improved efficiency this year is by reducing the number of patients who fail to attend their appointments.  We estimate that this costs approximately £3 million per year.  However, thanks to the introduction of a new reminder service which calls patients before their appointment is due, we have saved £357,000 since July, with plans to save £797,000 before the end of March.   "Reducing the number of patients who fail to attend appointments is not about 'cuts'.  It's about being smarter and making sure we get the best value for every penny of taxpayers' money we spend."