A DEAL has been struck that could avert hundreds of NHS job losses.

Debt-ridden Scarborough and North East Yorkshire NHS Trust had warned that 600 workers faced redundancy.

Bosses said the cuts were needed if the trust, which runs Scarborough Hospital, was to reduce a £10m spending deficit.

Yesterday, the trust announced that a deal with the Strategic Health Authority could mean only 50 jobs are lost.

Iain McInnes, the trust's chief executive, said: "We had identified two fundamental problems to address.

"Firstly, an historic debt of £20.7m. This was money spent by the hospital trust that we did not have.

"Secondly, we need to live within our financial means year upon year.

"Following negotiations with the Strategic Health Authority, it has agreed that the trust's historic debt does not have to be addressed as part of this financial strategy.

"The Strategic Health Authority has agreed to this arrangement, provided that the trust returns to year-on-year balance, delivers on all our contractual arrangements and makes efficiency savings of 2.5 per cent."

Mr McInnes said the trust needed to identify savings of £10.5m this year.

Plans to save £8m have already been put in place.

These include reducing overnight stays, using natural staff turnover, cutting down on temporary staff and better financial management.

Mr McInnes said: "Thanks to our agreement, and the efficiency savings we have identified, any role changes will not be of the scale previously reported in the media.

"For example, the £2m which remains to be found this year would equate to approximately 50 posts.

"We are optimistic that, if required, these posts could be found from non-clinical roles in the trust."

A review of all non-clinical roles within the trust has been launched.

Yorkshire and the Humber Strategic Health Authority chief executive Margaret Edwards said: "Following my discussions with its chief executive, I am confident it is moving in the right direction and that is why we have reached this agreement with the trust."

The cuts will be discussed at a public meeting of the trust board at 2pm, on Tuesday, in Scalby Village Hall, Scalby, North Yorkshire.