A BAKERY in the North-East is asking staff to take a ten per cent pay cut.

County Durham-based Peters Bakery, which runs both a bakery and a chain of shops, is understood to have put the proposal to staff last week.

Company bosses are due to meet representatives from the Bakers, Food and Allied Workers Union today to discuss the matter.

It is understood the firm, which employs about 580 people in the region, is asking for a ten per cent wage cut across the board.

If accepted, it is expected to be a short-term measure until the company – founded in Belmont in 1966 – can address some business issues.

A source said: “They have asked staff to take a pay cut.

Companies like this are going through a bad time – supermarkets are taking over.

“It is the worst time of the year for all bakers. Things are usually quite flat.”

Peters was started in December 1966 by Peter Knowles with one shop in Belmont.

It is still privately owned by the Knowles family, but the company now has 71 retail outlets from Ashington, in Northumberland, to Richmond, in North Yorkshire.

No one at the company was available for comment, despite repeated efforts by The Northern Echo over the past five days In April 2004, a fire destroyed its long-standing production base and head office on the Dragonville Industrial Estate, Durham City. It lost all production for 26 days and temporarily closed its 71 shops, before finding a temporary facility in Peterlee.

The Dragonville bakery was rebuilt and re-equipped with new machinery at a cost of about £9m and reopened in September 2005.

It has been a difficult time for the industry across the region.

In October last year, Middlesbrough-based Riverside Bakery Limited went into administration. It was bought by a local businessman in December and now trades as Tees Valley Bakery Limited.

Just before Christmas, Newcastle-based North-East Bakery, which ran a 13-strong chain of Nichols-branded high street shops, also went into administration.

In contrast, Newcastlebased Greggs is ploughing ahead with a store expansion programme after another successful year.

It intends to open up to 60 more shops this year as part of a £300m, five-year plan to open at least 600 more shops across the UK.