North Tees and Hartlepool NHS Trust is outsourcing its linen services to save £1.3m over the next seven years at the expense of 23 hospital jobs.
The trust concluded that replacing the existing infrastructure would offer poor value for money and decided that an external linen hire service represented better value.
By contracting Sunlight Hospital Services for seven years, the trust expects savings of £925,143 when compared to the costs of the current service, and savings of £1.3m against the expected costs of the internal service following the necessary capital investement.