The health regulator Monitor has announced that the troubled Mid Staffordshire NHS Foundation Trust has been placed into administration.

Alan Bloom of Ernst & Young and clinician Dr Hugo Mascie-Taylor have been appointed as trust special administrators and will take over the running of the trust from today, with the current executive reporting to them.

Monitor said the decision to place the trust into special administration followed an investigation which concluded it was 'neither clinically nor financially sustainable' in its current form.

Mid Staffordshire NHS Foundation Trust has been the subject of a critical report and public enquiry, which found that up to 1,200 patients died as a result of shortcomings in hospital care between 2005 and 2009.

The trust lost £20m last year.

The administrators now have 45 working days to design a way of providing services to patients in the area that is sustainable in the long term. They will work with commissioners and other local healthcare organisations to produce a plan for the reorganisation and sustainable delivery of health services.

Services at the Stafford and Cannock hospitals will continue to run as normal until a final decision is reached.

David Bennett, chief executive of Monitor, said: 'We have taken this decision to make sure that patients in the Mid Staffordshire area have the services they need in the future. It is now the role of the trust special administrators to work with the local community to decide the best way of delivering these services. There will be a full public consultation on any proposals for change.'