A CARE facility which looks after elderly and mentally ill residents is to close, it was confirmed last night.

Places for 59 permanent residents and up to 30 day care users will have to be found when the facility run by the ancient charitable Hospitaller Order of St John of God, in Scorton, North Yorkshire, closes at the end of March next year.

Ninety-eight staff are employed at the 120-year-old former hospital, which is set to be replaced by apartments and a housing development.

Trustees are engaged in an ongoing review of services at the site, which has been gradually run down over recent years.

St John of God previously provided surgical care with operating theatres, radiography, physiotherapy and x-ray departments on the site, but these closed allowing the religious order to concentrate on helping people with Alzheimer's disease, dementia and other special needs.

In a statement yesterday, Brother John Martin, Brother Provincial of the Hospitaller Order, said the home had been running at a loss.

He said: "The difficult decision to close the facility has been made in the light of the increased cost of maintaining an old building. Further problems have included unsustainable low levels of fees being paid by the state for expensive care and the additional capital investment that would be required to bring the building up to the standards now required by law."

He said that the order, together with North Yorkshire County Council's social services department, which pays for, and is ultimately responsible for, the care of the residents, was now examining other ways of providing the services and would report back in December.

The order hopes that the sale of the site and its buildings will provide long-term finance for community care projects it already runs at locations including Coulby Newham, near Middlesbrough, and Haughton, on the eastern outskirts of Darlington.

Seamus Breen, head of community care at North Yorkshire social services department, said: "We have until April next year to find a solution and are working very closely with the order to try to reshape future services.

"We have always been satisfied with the quality of care by the order and recognise the risk to services should we not be able to recommend viable alternatives."

It is not known what will happen to staff employed at the Scorton site.