Hospices across the country, and in the North East especially, are facing a funding crisis and will need to find an extra £120m to match the NHS pay offer to staff, chief executives have warned.

The charity Hospice UK said patient services risk being cut owing to a funding black hole in the sector.

Staff make up the majority (71 per cent) of hospice costs and hospices recruit from the same pool of staff as the NHS.

If they want to match the Government’s increased pay awards to NHS nurses and other staff, hospices would need to raise an extra £120m through fundraising, Hospice UK said.

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A spokesperson for Alice House Hospice in Hartlepool, which this week announced it has closed one of its care units as a result of the cost of living crisis and increased costs, said: “Alice House Hospice continues to struggle under the weight of the cost-of-living crisis and increased operating costs.

“We have strived, with the support of staff, volunteers and stakeholders, throughout these difficult times to reduce spending and run things as tightly as possible, without affecting the high-quality of our services, which remain our top priority.

“A reduction in donations, hospice lottery players and general fundraising support, to the forecast value of £295,000 is also seriously affecting our financial situation.

“Following emergency planning meetings, we are working to reduce this deficit to a level that is manageable, in order to secure the future of the hospice.”

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Earlier this year, North East hospice bosses and MPs across the Tees Valley jpined forces to warn they were having to deal with "a financial cliff edge" and would be forced to close without urgent funding.

They said current services are "not sustainable" and called for greater support for hospice services.

On average, adult hospices have to raise about two-thirds of their income through charity fundraising, while for children’s hospices the figure rises to about 80 per cent.

Toby Porter, chief executive of Hospice UK, said: “Hospices are a critical part of the health and care system, providing care and support to 300,000 people a year across the UK.

“But right now rising staff and energy costs are stretching their finances to the extreme. Nearly all hospices are budgeting for a loss this year.

“Hospices are committed to paying their brilliant staff a fair wage, but without proper Government support they will need to try and find the funds to do so through the income they raise from charity shops, marathon runs and bake sales.

“It is just not realistic to expect them to do so at a time when the cost-of-living crisis is affecting their supporters.

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“We are asking for the Government to recognise this by finding a way to support hospices to keep pace with NHS pay rises this year and next.

“If they fail to do so, services will inevitably be cut. Just this week we’ve seen a hospice in the North East of England being forced to close some services.”