SUPPORTERS of a hospice which offers vital care for terminally-ill patients have reacted with disbelief after they were turned down for Government help.

St Cuthbert's Hospice, in Durham City, has found that its application for money under the Government-funded Futurebuilders programme has been refused, leaving it to apply for a huge bank loan to plug the gap in its finances.

Hospice chairman Keith Willans said he was 'disgusted' with the decision, while newly-elected City of Durham MP Roberta Blackman-Woods said she was 'astounded' and would be seeking an urgent meeting with the body to ask it to reconsider.

In its latest round of grants, Futurebuilders handed out £8.1m, including £2.5m to a cultural centre for deaf people in the West Midlands, £2m to Catz Club to build a network of after-school clubs around the country and £1m to Croxteth Community Centre, in Liverpool, to buy an old church and train teenagers in skills from horticulture to hairdressing.

But the hospice's application for a £1m loan and a £250,000 grant was refused by the body, which says other applications more closely matched its aim to improve public services. The board was also concerned about the hospice's ability to pay back the loan.

Earlier this year, St Cuthbert's launched its Key Appeal to build a £3.2m extension offering round-the-clock specialist palliative care.

The hospice has already raised £1.9m towards the cost of the ten-bed unit but appealed for help in bringing in the remaining £1.3m needed.

The hospice held protracted discussions with Futurebuilders - the £125m Government investment fund run by an independent board from the voluntary sector and overseen by the Home Office - about a low-cost loan.

Mr Willans said: "I feel that Futurebuilders led us up the garden path. It was a waste of time and a significant waste of money because of the fees we had to pay to get the proposal drawn up.

"If the Government won't help us then we will have to do it on our own, with the help of the public who have always supported us."

Ms Blackman-Woods said she was now asking for discussions with senior figures from Futurebuilders to ask them to reconsider. She said: "St Cuthbert's is a vital and well-respected hospice in Durham and it provides a wonderful services to my constituents and their families. I would be astonished if Futurebuilders could have found a more deserving organisation to support."

Director Peter Deans said: "With money to invest in only 250 projects nationwide, Futurebuilders faces some tough decisions and, unfortunately, St Cuthbert's Hospice wasn't successful this time."