THE influential Confederation of British Industries (CBI) is expected today to reject a proposed North-East elected assembly, saying its members had given the Government plan a "vote of no confidence".

The employers' body says that a new tier of government would further complicate the democratic process.

It believes that economic growth could be damaged with unhelpful party political interference undermining the efforts of regional development agencies (RDAs), such as One NorthEast.

Its stance will prove a blow to campaigners for a yes vote in the North-East - the first English region in line for a referendum on an elected regional assembly.

The CBI wants Deputy Prime Minister John Prescott to set up a task force to thrash out alternative proposals to those published in a recent White Paper.

John Cridland, CBI deputy director-general, said: "Employers want stronger regional economies, but there is little evidence to suggest elected assemblies will make a difference."

Steve Rankin, North-East regional director, said: "It's good news that ministers are offering the sort of effort and resources the region needs. But we do not want to waste this golden opportunity by backing the wrong solution."

The CBI intervention follows a consultation with firms in all the English regions.

The confederation says evidence shows assemblies have failed to strengthen democracy by engaging voters.

And it cited experiences in Scotland and Wales where the costs of devolved power have spiralled out of control.

A further criticism is that regional assemblies are seen as "talking shops" and would allow no genuine input from business.

Neil Herron, of the North-East Against Regional Assemblies (NEARA), said: "The people of the North-East have never asked for a regional assembly and business have never asked for it. It is good that the CBI are behind us. We want to see bureaucracy and red-tape removed so business can function, but this will not help. It will be an expensive talking shop for self-serving politicians."

Tony Flynn, leader of the campaign for a North-East Regional Assembly, claimed the CBI were "dancing to a national tune".

He said many in business in the region were in favour of the assembly, but wanted it to have more powers.

"The CBI are the odd ones out here. The vast majority of people want strong regional Government.