HEALTH Secretary Patricia Hewitt is intervening to check on measures to resolve a North-East hospital trust's deep financial problems.

Rising costs at the South Tees Hospitals NHS Trust have forced hospital bosses to announce severe spending reductions and plans to cut 161 jobs.

Mrs Hewitt said she would write to its chairwoman, Glenys Marriott, to check on the progress of its cost-reduction programme, along with the chairmen of other cash-strapped hospitals across the country.

South Tees trust, which runs the 1,000-bed James Cook University Hospital, in Middlesbrough, The Friarage Hospital, in Northallerton, North Yorkshire, and Guisborough Maternity Hospital, east Cleveland, has been told to make cuts totalling £66m over the next three years.

To underline what the Government says is its determination to bring costs under control, NHS chief executive Nigel Crisp will also write to the trust's chief executive, Simon Pleydell.

The intervention of Mrs Hewitt follows yesterday's warning that the NHS as a whole is heading towards crisis because of poor financial management.

In 2003/2004, more than 100 NHS groups were in deficit -16 of them by more than £5m -according to a report by the National Audit Office and the Audit Commission.

It said services were being cut because of inadequate financial management.

It also warned that the situation could get worse, with Government reforms putting "unprecedented pressure" on NHS finances.

She said staff affected by proposed job cuts were being consulted and that everything was being done to avoid compulsory redundancies.

The trust board has also appointed chartered public finance accountant David Kirby as a non-executive director