SAINTS could soon be haemorrhaging money at the rate of £1m a month, the Daily Echo has learned.

Equivalent to more than £33,000 A DAY, the losses will force bosses to sell star players such as Gareth Bale just to stay afloat.

To avoid the nightmare threat of administration, which attracts an automatic ten-point penalty from the Football League, costs have to be cut back to the bone and the structure of a Premiership club dismantled.

The Echo understands that the club are currently losing around £500,000 a month.

They lost around £416,000 a month in the half-year leading up to December 31, 2006.

But once the parachute payments dry up this summer, the monthly loss will soar towards the £1m mark.

A source said manager George Burley would have to "beg and borrow" players because any cash would go to fill yawning holes in the accounts rather than on transfers.

The dire financial straits mean that unless a wealthy investor such as US billionaire Paul Allen steps in, the club could find itself selling of all its best players and left without a penny to reinvest in the side.

Forecast to lose around £8m this year, club finances are also reeling from the loss of £6.5m a year parachute payments designed to ease relegation from the Premiership over the first two seasons after the drop.

The financial hole is partly the result of Saints' ill-fated gamble on winning promotion to the Premiership, which saw them splurge £7m - more than any other Championship side apart from promoted Birmingham - on players last summer.

Now the play-off dream has been ended by Derby County, the brutal financial realities are finally becoming clear.

Back in March, Saints revealed a loss before taxation of £2.5m in the six months leading up to December 31, 2006 - £416,000 a month.

The half-yearly statement also included the following sentence: "The Directors have prepared cash flow forecasts for the forthcoming 12 months, which in the event of non-promotion to the Premier League include the sale of various assets and the continued support of the bank."

A source said: "For the year ending June 30 the overall loss will be £8m.

"That kind of loss equates to the money spent on players last year. On a day-to-day basis the club has washed its face.

"Going forward, the loss is exacerbated by the fact that you don't have the parachute payment anymore. Losing £1m a month is the scenario if you do nothing."

He added that administration - similar to the financial meltdown that recently hit Leeds United - was unlikely.

"I think the answer will be a combination of selling players, particularly Gareth Bale," he said.

"Burley would be hugely limited in his squad, in terms of his ability to bring in the best players in that division. It would be loan players and that sort of thing."

Full story: See today's Daily Echo.