HOSPITAL staff in Northallerton, Guisborough and Middlesbrough could face redundancies because of a cash crisis at South Tees Hospitals NHS Trust.

The trust runs Northallerton's Friarage Hospital, the James Cook University Hospital in Middlesbrough and Guisborough Maternity Unit.

It is due to spend £13m in excess of its annual budget by April and will also have to repay a £12m loan from County Durham and Tees Valley Strategic Health Authority.

Hospital chiefs believe an immediate vacancy freeze would save £9m in the next financial year, due to a 5pc reduction in staffing costs.

The recruitment freeze would mean no vacancies were filled other than in exceptional circumstances.

But chief executive Simon Pleydell confirmed redundancies could be on the cards.

He said: "It is vital we bring the trust back to a healthy financial position.

"I appreciate that colleagues across the trust are worried about redundancies.

"While we cannot rule this out, making people redundant will be a last resort."

Mr Pleydell said the trust had already achieved £6.9m in savings, but must now push ahead further cuts.

Other measures would include tighter housekeeping, better buying, reducing management overheads and saving on equipment and drugs.

Wendy Hull, director of finance, said the cost of staffing had to be seriously considered, but vowed it would not adversely affect patient care.

"We have to be realistic in making these proposals and entirely mindful that patient care comes first," she said.

"Waiting times are a huge national priority and we wouldn't want any of them or our performance to fall."

Margaret Toase, branch secretary of Unison, said: "It's very concerning and worrying for people, but we have to work through it."

The news came just days after bosses at North Tees and Hartlepool NHS Trust predicted a deficit of £6m at the financial year end and also ordered a recruitment freeze.

* Medical staff are hosting public meetings in Richmond and Thirsk to talk about hospital services in the area.

People are invited to find out about work being done to maintain services at the Friarage Hospital and raise any concerns.

Several departments at the hospital have recently been under review to increase efficiency, and issues such as doctors' working hours have been addressed.

Simon Kirk, chief executive of Hambleton and Richmondshire Primary Care Trust, said: "We know that concern has been expressed locally about the future of the Friarage and the public information meetings will be an opportunity to respond to these concerns.

" We need to explain how we are trying to work around these issues, and to stress that doctors and managers are working very hard to make sure that local people continue to get a comprehensive range of services at the Friarage."

Meetings will be held in the Manton Suite, Thirsk Racecourse on Tuesday, March 15, at 7pm, and in Richmond Town Hall on Thursday, March 31, at 7pm.

Staff hope to hold meetings in Northallerton and Wensleydale in April and May