North-east's boom helps to narrow the wealth gap

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The Independent Online

Millions of pounds that the Government has spent trying to break the cycle of poverty in the country's most run-down inner cities have started to have an effect, according to unpublished statistics compiled in John Prescott's office.

The gap is closing as unemployment falls faster and educational achievement rises faster in the poorer parts of the country than in richer parts. For example, the region with the highest economic growth rate in England, according to the latest statistics, is the North-east, which has been associated since the 1930s with long dole queues.

None of the figures can be said to prove definitively Tony Blair's claim that England's North-South divide is a thing of the past. But they are a comfort in a week when a study by Bristol University showed that London's population is growing at an alarming rate because of people moving to where the better-paid jobs are.

During the 1990s, the North-east had an average growth of 4.4 per cent a year, but recent figures show that in 2002 the economy grew by 5.6 per cent compared with 4.5 per cent growth in London, the South-east and the East. It appears this is largely attributable to educational improvements. More than 41 per cent of the North-East's working-age population now have diplomas or degrees compared with less than a third in 1997.

Yvette Cooper, who is a minister responsible for urban regeneration at the Office of the Deputy Prime Minister, seized on the statistics as evidence that government intervention is working. "The gap between deprived areas and the rest of the country is starting to close ... but we have got to go further."

The figures may, however, pose a problem for Mr Prescott, who wants elected regional assemblies set up in the North-east and other parts of Englandto create attractive conditions for investment and close the gap between North and South. But opponents will now be able to argue that the assemblies are unnecessary.

Others will say that, even if the gap has started to close, the North's problems with unemployment and crime are still worse than the South's.