No new cash for bank loss hospice

The hospice has already made cuts to its home service

A Hampshire children's hospice which invested £5.7m in one of the collapsed Icelandic banks has been told it will not receive government compensation.

The future of some of Naomi House's services has been uncertain since Kaupthing Singer and Friedlander went into administration last October.

The government's move comes after a Treasury select committee recommended charities should be compensated.

Hospice chair Professor Khalid Aziz said the decision was "disgraceful".

Our hopes that the government would do the right thing have been dashed Professor Khalid Aziz

The Sutton Scotney charity may have to wait up to three years to get the money tied up with Kaupthing Singer and Friedlander .

Naomi House - which looks after terminally-ill children from Hampshire, Berkshire, Dorset, the Isle of Wight, Surrey, West Sussex and Wiltshire - has already suspended its community outreach home service in December because of financial problems.

Prof Aziz said: "Their refusal to compensate us means that we will struggle to continue providing our unique services to life-limited children and young people.

"The loss of this money could have a tremendous impact on hundreds of families who benefit from the work of Naomi House."

The charity's new £12m hospice, Jacksplace, built to provide palliative care and support to young people who have outgrown facilities at Naomi House, could also face cutbacks.

Prof Aziz added: "Our hopes that the government would do the right thing have been dashed."