BOSSES at a crisis-hit hospital trust have been told to make cuts totalling £66m over the next three years.

Managers have pledged to maintain services and avoid compulsory redundancies, but there are growing fears that patients may be affected.

The sheer scale of the savings needed at the South Tees Hospitals NHS Trust also places a question mark over the future of the recently re-opened Guisborough Maternity Hospital.

The trust, which includes the 1,000 bed James Cook University Hospital, in Middlesbrough, and the Friarage Hospital, in Northallerton, North Yorkshire, has been steadily accumulating debt since early last year after being bailed out by the regional NHS.

Despite a tough-cost reduction programme and a recruitment freeze, the trust finished the last financial year £9m in the red and heading for a cumulative debt of £32m within a few years.

The trust, which has an annual budget of £320m, has drawn up a savings plan that would have clawed back £44m over the next three years but it has been ordered to find an additional £22m in savings.

In a dramatic intervention, district auditor Lynne Snowball has served the trust with a public interest report.

The hard-hitting report presented to yesterday's South Tees board meeting warns that the trust must pay back its debts or face the risk of failing to meet its statutory obligations as a public body.

Mrs Snowball criticised trust management for failing to realise the seriousness of their financial situation.

She said the worsening financial performance has been allowed to go unchecked, without action being agreed to address problems.

Simon Pleydell, chief executive of the trust, said: "We are not the only trust facing these kinds of issues. We will have to sit down with the strategic health authority and the primary care trust to see how collectively we are going to manage this."

He said the trust would be looking to deliver health care more effectively rather than make cuts in services.

"We will try to redeploy staff so that redundancy is a last recourse," he added.

Yesterday's board meeting backed an interim savings plan which will cut up to 166 jobs, including nurses - although 112 of these posts are either vacant or filled by temporary staff.

The plan will also involve a review of Guisborough Maternity Hospital and microbiology services at the Friarage.

Liz Twist, regional head of health for Unison, said: "We are obviously concerned for the staff and about patient services. This is a hell of a lot of money to find and there is going to be some difficult decisions."

Redcar and Cleveland Borough Council said it had "very real concerns" over the future of Guisborough Maternity Hospital