After several tumultuous years, a hospital trust struck a note of optimism at its AGM last night with improved care and plans to balance its books by the end of this financial year.

Epsom and St Helier Hospitals gave the optimistic financial forecast after 2013-14 ended with a deficit of £7.4m, down from £12m in 2012-3 and £17m in 2011-12.

But a hospital campaigner said the hospitals were recently referred to Health Secretary Jeremy Hunt over auditors’ concerns - something she claimed was the "elephant in the room".

The AGM at St Helier, attended by fewer than 50 people, heard that the hospitals only failed to meet one key standard. This target was for zero cases of hospital superbug MRSA but the hospitals recorded eight cases in 2013-14.

Chief executive Chrisha Alagaratnam acknowledged that the trust had been through "much turmoil" over the past few years but was confident that it now has a "strong future".

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A controversial Better Services Better Value programme, which proposed axing A&E and maternity services, was scrapped earlier this year but the same issues remain under review.

Ms Alagaratnam said: "Despite the uncertainty the [BSBV] programme has caused, we have achieved so much.

"We have improved on quality of care, we are on course - despite the pressures - to balance our books at the end of this year and we have hit our challenging performance targets, in fact our A&E performance has led London."

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The pubic got to try hospital food before the AGM last night

During question time following presentations, hospital campaigner Sandra Ash said: "Nobody has mentioned the big elephant in the room which is the fact the hospital has apparently been referred to the Secretary of State for Health because it’s one of the worst 19, most at risk hospitals financially, in the country.

"As far as my understanding goes, this means it’s perhaps one step away from being referred to a trust special advisor."

Mrs Ash also said the clinical commissioning groups (CCGs), which hold the purse strings for buying healthcare, plan to move services from hospitals to the community and GP surgeries.

She said: "Why has nobody here tonight mentioned how you propose to deal with what must be an enormous loss of income for the hospital?

"And nobody has mentioned what looks to patients like a very frightening situation."

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Hospital campaigner Sandra Ash

In response trust chairman Laurence Newman said the hospitals were actually referred to Mr Hunt because of what was in some ways a "technical reason".

Mr Newman said: "It came because we had a deficit last year of £7.4m. That deficit was a budgeted deficit, we agreed that deficit in advance. There were no surprises when it came in.

"There is absolutely no prospect of any sort of trust administrator being appointed. The direction of the trajectory is clearly in the right direction and we really do not feel we are being threatened."

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In relation to CCGs' plans, Jackie Sullivan, chief operating officer at the trust, said: "It is appropriate sometimes to move work to the community and we want to work with our partners to do that but we are not seeing a slowdown of referrals to this hospital."

Later when asked if St Helier would close, Mr Newman said: "The easy answer is no, St Helier hospital is not going to close, it is not going to lose any of its services, it is not going to lose its A&E or its maternity services.

"Having said that, all of healthcare in London as a whole is being looked at and who knows what will come of that. As we sit here today we can say hand on heart it’s not going to close."

Last year the hospital trust spent £366m in operating costs including £225.7m on staffing and £7.3m on clinical negligence costs.

The AGM included a video montage of patients praising the hospitals' services and the presentation of a patient-nominated award to Dr Ruth Charlton, joint medical director and deputy chief executive.

There was also an exhibition in the restaurant before the AGM. This included the chance for the public to taste hospital food, watch staff working on a dummy simulating an asthma attack and learn about hospital initiatives and groups.