THE cost of living in the North-East is lower than anywhere else in the country, according to a survey.

Billingham, on Teesside, has been identified as one of the cheapest places in Britain to live.

The survey, carried out by the Reward Group, adds fuel to the argument that the North-South divide not only exists, but is actually getting wider.

The survey shows that the annual expenditure for a family living in a four-bedroom, detached house, with a mortgage, driving a large car and sending their children to private school is £57,258 in the North-East.

That is more than £20,000 lower than a similar family in London, the most expensive place in the country to live, at £79,261.

Billingham is named, along with Northern Ireland, Thurso, Merthyr Tydfil and Doncaster, as the cheapest areas to live.

Almost everything in London and the South-East is more expensive to buy than in the North, ranging from staple items such as a kilogram of potatoes (17p in the North-East and 22p in London), to larger goods like a gas cookers (£242 compared with £276.81).

The evidence is that the gap is widening all the time. The cost of living in London has gone up by nearly 25 per cent over the past five years, but by only 15 per cent in the North-East in the same period.

Experts say that while workers get paid more in the South, it is not enough to cover the cost of living gap.