INDUSTRY Secretary Patricia Hewitt will today warn the North's call centre workers to improve their skills or risk losing their jobs to India and the Philippines.

A long-awaited report on the so-called offshoring of jobs will warn that British staff lack vital "soft skills" in areas including communication and customer service.

She will report that call centres have a bright future in the UK and will employ one million people in three years' time.

The North-East is the call centre capital of the UK, with one in every 23 workers - a total of 47,466 people - employed answering phones, in management or support jobs.

But last year, Lloyds TSB rocked the region when it announced it was cutting 980 jobs by moving its Tyneside call centre work to India.

National Rail Enquiries also said jobs were to go at its centre on Tyneside, and Norwich Union, which employs 4,000 people in the North, has plans to export jobs to Asia.

A further 50 staff at the Darlington branch of Axa Insurance are to lose their jobs after the company switched work to Bangalore, in India.

In March, mobile phone group Orange became the latest company to send work to India, though it said there was no threat to its sites at Darlington, Peterlee, in County Durham, and North Tyneside.

The average starting salary in a North-East call centre is £14,000, compared to only £1,500 in India, where skills are often higher.

Ms Hewitt announced the independent study last December, amid an outcry from trade unions who claimed more and more jobs were being lost overseas.

The report concludes: "UK call centres should not compete with offshore contact centres on the basis of low costs, but they can by improving quality, demonstrating a viable alternative."