THE NHS is half a billion pounds in the red with the North-East contributing more than £46m of debt, according to a survey.

A snapshot of finances carried out by the Health Service Journal revealed that the NHS is facing its bleakest outlook for years.

The survey of England's strategic health authorities (SHAs) found a total deficit of £497m.

Even with belt-tightening measures across the country, finance directors are forecasting that the NHS will still be £225m in the red at the end of March.

The journal said cuts had already been made in some trusts in attempts to get finances back on track.

This included cutting back on services, closing beds and operating theatres, freezing recruitment and making redundancies.

Half of all English SHAs said they expected to be in the red by March 31, despite the fact they are obliged to break even by then.

In the North-East, all three SHAs are reporting a substantial deficit.

County Durham and Tees Valley SHA is £18m in the red, Northumberland, Tyne and Wear SHA is down by £18m, and the North and East Yorkshire and Northern Lincolnshire SHA is £19m in deficit.

But only County Durham and Tees Valley SHA is predicting it will still be in the red come April.

This is because of the previously reported financial problems at South Tees Hospitals NHS Trust, which runs the 1,000-bed James Cook University Hospital, in Middlesbrough, and the smaller Friarage Hospital, in Northallerton, North Yorkshire.

Last month, the trust admitted that it faced debts of up to £25m.

Apart from a predicted overspend of £13m, the trust has also had to request a £12m cash injection by its SHA.

The trust has imposed a recruitment freeze in some areas and is looking at ways of making savings.