THE number of people working at Swan Hunter's Tyneside shipyard will more than halve in the New Year when work on two Royal Navy ships is completed.

Swan expects work on the Largs and the Lyme Bay to be finished by spring, with the first ship leaving the Wallsend yard, on North Tyneside, for sea trials after Christmas and the second following a few months later.

The workforce of 600, many of whom are sub-contractors, is expected to fall to about 250 - and those jobs will only be safe if the yard secures licences to decommission ships. Project manager John Mitchell said: "The application has been going through slowly and we expect to receive the licences in the New Year.

"After the ships have left, there will be no other work at the yard other than the decommissioning and a couple of hundred people will be retained to do that work."

As well as setting up a ship-breaking division at the yard, Swan is hoping to win shipbreaking work from Dutch company NV Ecodock.