BRITISH postage stamps will no longer be printed in the UK under plans by De La Rue to switch production between its factories at Gateshead and Malta.

The move will create up to 10 jobs at the firm's Team Valley base where it operates a passport printing factory and an adjacent plant which produces banknotes, security stickers and postage stamps.

The Gateshead banknote operation, which is already the largest facility of its kind in the world, will take on some of the contracts currently held by De La Rue's Malta site.

About 300 jobs will be lost in Malta, where banknote printing will end. De La Rue will spend up to £30m on the overhaul, which includes basing its identity, security and postage stamp operation in Malta.

The firm employs 550 people at its Tyneside plants where about 60 people were made redundant earlier this year as part of cost cuts.

A spokesman said the latest move, which will be phased in over the next two years, was aimed at "streamlining operations" and denied it was in response to falling demand for paper currency.

The plans, which need to go through consultation with unions, will mean Gateshead loses its contracts to make security identifications, such as stickers used to validate Microsoft products, but take on more banknote work.

The company designs and prints more than 150 currencies.

Earlier this year De La Rue secured an extended deal to produce sterling for the Bank of England from its plant at Debden in Essex, including new plastic notes due to enter circulation in 2016.

Martin Sutherland, De La Rue's chief executive, said: "Our manufacturing footprint review has identified significant opportunities for improvements in capability and efficiency. We we are announcing plans to achieve a more streamlined De La Rue, in line with the future needs of our global customers, focused on centres for excellence with investment that underpins our future."

De La Rue, which has been producing banknotes since 1860, has announced a series of profit warnings this year as it has struggled against competitors and the strength of the pound against the euro.