INSURER Norwich Union plans to make 600 staff redundant in an efficiency drive which aims to remove 900 posts.

The restructuring will see the closure of a life and pensions administration office at Cheadle, near Manchester, and the loss of jobs at NU's headquarters in Norwich and at bases in Perth and Worthing.

The company said the cutbacks would have a minimal effect on its operations in Newcastle, where 680 staff are employed.

About 440 people work for Norwich Union general insurance, and the remaining 240 deal with life insurance. Three staff will be lost.

NU's head office for life and pensions in York, employing more than 3,000 staff, will be unaffected by yesterday's announcement.

Parent company Aviva, which employs 33,000 UK staff, said the cutbacks were necessary to achieve greater efficiency in an extremely competitive market.

Union leaders described the announcement as a sad day for NU and said it would work with the company to minimise the number of compulsory redundancies.

Aviva said most of the 280 jobs being lost at Cheadle were likely to be compulsory because of the lack of relocation opportunities for those staff.

About half of the 630 jobs being removed in general insurance - covering car, home and travel services - are likely to be compulsory.

The company has decided to remove 300 posts at Norwich, with 60 to go at Perth and another 40 at Worthing. The remainder of the cuts will be spread across NU's 32 offices.

Aviva, which was formed following the merger of Norwich Union and CGU in 2000, said there would be minimal impact on staff who deal with customers and that yesterday's news was not linked to the recent opening of a call centre in India.

The company said it would try to redeploy staff where possible