Health chiefs have defended their review delay at a full meeting of North Norfolk District Council - where they were told that morale in at least one local hospital was "terrible".

Health chiefs defended their review delay at a full meeting of North Norfolk District Council last night - where they were told that morale in at least one local hospital was "terrible".

Primary care trust chairman Sheila Childerhouse said: "None of us is happy about deferment of the review, but we need to get our ducks in a row, ensure it is robust and get it right."

Staff at North Walsham hospital were "terribly demoralised", worried about their jobs and about speaking out, said councillor Sue Willis.

Mrs Childerhouse admitted the cost of current health service changes was not just about finance, and recovering a £50m debt - which should see the primary care trust back in the black by 2008 - but also involved uncertainty for staff, which had been tough on them.

She countered rumours that Aylsham hospital was being eyed up for expansion and Walsham for closure, acknowledging such talk was happening, and was damaging.

And councillors were assured that the PCT was committed to listening to, and involving, local communities during the proposed changes which would now be announced later in the month.

However Mrs Childerhouse admitted: "We are not always our own bosses and have to work in a national context which can be uncomfortable."

Trust public services director Mark Taylor said the review was not saying any of the community units were anything other than first class, but there needed to be balance between beds and the kind of community care in the home which was commonplace in other parts of the county - and for which north Norfolk was "the most poorly served by a long way".