PLANS to build an animal sanctuary in Chester-le-Street have been put on ice while the RSPCA struggles with multi-million pound losses.

The governing council of the charity announced on Tuesday that it was taking drastic action to cut costs after losing £8.8m on the stock market last year and £7m this year.

The organisation is trying to claw back £12m over the next 12 months by suspending all its capital projects, one of which was an animal welfare centre for Chester-le-Street.

The centre, on the site of a former school at Chester Moor, was to have eased pressure from the North-East's only other RSPCA centre in Great Ayton, near Middlesbrough, which is consistently full.

The charity has said it will review its postponed plans in 12 months time.

A statement from the RSPCA's head office in Sussex, read: "To safeguard the RSPCA's future operations, the society is today announcing steps to reduce expenditure whilst endeavouring to make sure that vital animal welfare services are protected."

The charity is said to have already spent thousands of pounds in their successful appeal against Chester-le-Street District Council's decision not to approve planning permission.

The RSPCA argued there was an overwhelming need for it, given the region's high level of animal cruelty.

An anonymous worker for the charity said: "They have decided to abandon the plans because of the financial problems. I'm disgusted because it is needed up here. They have already spent thousands of pounds applying for planning permission and appealing against the council's decision. Now they haven't got the money to build it."

Chester-le-Street District Council said planning regulations mean that the RSPCA has five years in which to begin work on the site and will have to reapply for planning permission after the time span expires.

Other cutbacks at the charity involve freezing staff pay for a year, reducing the number of regional press office posts from ten to five and ordering all departments to reduce their budgets to safeguard future operations. No decision has yet been taken on whether to close any regional headquarters.