A CHILDREN'S hospice that cares for terminally-ill youngsters across the region has allayed fears it is in crisis after a £150,000 hole in its budget emerged.

Bosses at Butterwick Children's Hospice said it had launched a fundraising campaign to make up for the loss in Government finance and safeguard its future.

The service, which cares for youngsters from Newcastle to North Yorkshire, had received £150,000 a year from the New Opportunities Fund, but the monetary award is due to end in March.

Hospice chief Graham Leggatt-Chidgey stressed last night the hospice was not in immediate crisis and there were no fears it would close.

He said: "We are not in a crisis situation. We recognised we were going to lose the £150,000 funding and we are going to do everything we can to replace it.

"We are not sitting back on our laurels. We will be fundraising and we are encouraging people to help us fundraise. Equally, we hope to send out a message to the Government that something needs to be done about this."

The hospice, in Stockton, Teesside, received only £20,000 from the NHS last year towards its annual operating costs of £700,000.

An early day motion has been tabled by MPs at the House of Commons asking the Government to undertake an urgent review of NHS funding for children's hospices.

Adult hospices get 35 per cent of their budget from the Government, but children's hospices receive only five per cent.

Kathy Lloyd's three-month-old granddaughter Leah spent her final days at the hospice after losing her battle against Hirschsprung's disease and £4,000 was raised for the centre in her memory.

She said: "It is a vital service and I back them 100 per cent. They are absolute angels and we will certainly be supporting them and hope to do another fundraising night."

* Anyone wanting to help Butterwick Children's Hospice with the fundraising effort is asked to ring (01642) 624231.