Under the plans, the company will become much more flexible, but it could mean job losses in both London and Stratford-upon-Avon, reveals BBC Online News.

As well as better pay, shorter contracts will also be offered to actors to provide more flexibility. The current system involving more lengthy contracts has been blamed for frightening off many actors and directors.

There are also plans to launch an academy at Stratford in order to recruit actors at the start of their careers and bring them on.

RSC artistic director Adrian Noble told the BBC: "The crucial thing about the process we have embarked on is that it gives us the flexibility to stage bold and original theatre."

Instead of creating a season of plays which transfer from Stratford to Newcastle to London, a more flexible model will involve a number of smaller companies opening plays throughout the year in a variety of venues.

The company will still stage some productions in the Barbican main theatre - it's main venue in London - but not in the smaller Pit. The Barbican is understood to be pleased at the plans, which would free up some of its stages for other projects.

The Arts Council of England, which is the RSC's main source of funds, said it would support in principle and would await more details before deciding on finance.