Hospital bosses have lost out on a bid for £7 million to modernise Victorian wards.

The Nightingale dormitory-style wards at Brighton General Hospital are said to be unsuitable for modern healthcare and need refurbishing.

Brighton and Sussex University Hospitals NHS Trust applied to the Department of Health for money to improve the wards and build a new unit but has learned the bid has not been accepted.

Bosses are now looking at alternative ways to carry out the refurbishment.

The trust eventually plans to move all its acute services out of Brighton General and base them at either the Royal Sussex County Hospital in Brighton or Princess Royal Hospital in Haywards Heath.

It says any future investment at Brighton General needs to be balanced with this but it will continue to work on improving conditions as the full transfer is expected to take at least ten years.

Government guidelines state Nightingale wards in all hospitals should be phased out by the end of March 2004.

The trust had planned to use the £7 million to build a new 83-bed block on the site of the former laundry at Brighton General and upgrade one of the existing wards.

This would have got rid of the Nightingale wards at the hospital and improve conditions for about 173 patients.

There have been numerous complaints from patients, relatives and the Brighton, Hove and Lewes Community Health Council (CHC) about conditions there.

Concerns included inadequate bathing and toilet areas on the wards, which have little privacy.

The trust has already spent hundreds of thousands of pounds on improvements, including eradicating mixed sex wards and redecorating.

It now plans to work with colleagues in the health service at a local and national level to consider what options are available to resolve the problems there.

Trust chief executive Stuart Welling said: "Over the coming years we are going to see significant developments in the environment for our patients and our staff.

"Our vision for acute services is one that sees every patient being treated in a modern hospital facility by 2013.

"But this does not mean abandoning our existing older hospitals in the meantime.

"We will continue to struggle against the deteriorating fabric and invest what money we can in maintaining those buildings until they close.

"While the decision not to fund this significant development is disappointing, I am confident that we can work with colleagues in the NHS to continue to support and improve the environment at Brighton General Hospital."

CHC chairwoman Mo Marsh said: "We are very disappointed the money has not been granted for these improvements.

"We know how much the trust has been concerned about the conditions on the wards and wanted to improve them.

"I know it is eventually moving out but that is not going to happen for ten years and there will be a lot of patients passing through in the meantime who may have to put up with cramped, inadequate conditions.

"It is frustrating for us, the trust, and most importantly, the patients."