PRIME Minister Tony Blair has presided over a widening of the North-South divide during his decade in office, according to a leading North-East academic.

A report published today, to coincide with the tenth anniversary of Labour's 1997 election landslide, concludes that the North-East has never had it so good and is a better place in which to live - but the region still lags behind the rest of the country.

It also highlights a growing wealth divide in "Blair's backyard" between affluent towns such as Hexham, in Northumberland, and places such as the east Durham former pit community of Easington.

Durham University academic Professor Fred Robinson, author of the wide-ranging report, found that although the region's economy has recorded significant improvement since 1997, other regions have performed better than the North-East, which is still rooted to the bottom of the English league table.

Among the findings of the independently-funded report - Never Had It So Good? The North-East Under New Labour - are:

* Manufacturing jobs have fallen from 231,000 to fewer than 150,000, and there are now more people working in the region's shops than its factories;

* The number of people in work has grown by 42,600 in ten years - but much of the growth has been in the public sector;

* Unemployment has fallen from 9.5 per cent to 6.2 per cent, and the gap between unemployment in the region and the nation has narrowed;

* Incomes have increased but failed to keep pace with increases elsewhere, and the North-East still has the lowest average household income in the UK, with more people living in "relative poverty" than any other region;

* Life expectancy has improved, but remains well below the national average - and the region has more smokers, binge drinkers and obese people than other regions.

Prof Robinson said: "Undoubtedly, the North-East is a better place after ten years of the Blair Government, and I am surprised how grudging people are about that at times.

"It is undeniable that things have got an awful lot better for most people."

But he added: "The sad thing for north-east England is that it has not changed enough to narrow the gap with other regions."

The report, co-authored by Ian Zass-Ogilvie and Michael Jackson, of St Chad's College, concluded that while the business community was optimistic about future prosperity, much of the new employment created in the region was in the public sector, leaving the region at the mercy of future Government investment policy.

It also found that disadvantaged districts such as Easington had begun to benefit from the "trickle-down" effect of general economic growth only in the past two or three years, and were still lagging behind the rest of the region.

Prof Robinson also argued that the North-East's growing prosperity was down to the effects of national economic growth, rather than regional policy.

The report received a varied response from the region's politicians.

Dr Roberta Blackman-Woods, Labour MP for Durham City, said: "We only need to think back to what our region was like ten years ago to realise how much it has improved.

"Our economy is strong, employment is up, unemployment is down, and relative poverty is in decline.

"But we must do more to make the North-East become better and even stronger in the next ten years.

"We do need to do more to tackle the north-south divide, to make our region fairer and more competitive."

Michael Bates, deputy chairman of the Conservative Party, said that Labour had failed to address problems such as income inequalities, social exclusion and a decline in manufacturing jobs which Mr Blair had highlighted when he came to power.

He said: "Whatever the good intentions, as far as the North- East is concerned, things have not got better and, in some respects, such as the competitiveness of the regional economy, we have actually fallen back.

"Most worryingly, there is a growing divide in the region between the haves and the havenots." Fiona Hall, Liberal Democrat MEP for the North-East, said the Prime Minister had failed to overhaul the Barnett Formula - which allocates money to deprived regions - transfer Whitehall jobs to the region or upgrade the A1.

She said: "Since 1997, the Government have repeatedly wasted opportunities to address the widening gap within the region and also between the North-East and other regions.

"The gap between the rich and poor is wider now than at any time since Margaret Thatcher was Prime Minister.

"Tony Blair has taken the North-East for granted."