NEW figures have revealed new businesses still prefer to set up in the South.

A league table of enterprise - business start-ups per head of population - showed the seven top areas were all in the capital while the bottom five, which included Redcar and Cleveland, were in the North-East.

The table, published by the Treasury, shows far more firms registering for VAT in the South than the North.

The seven leading areas for business creation were all in London, headed by the City of London, with 2,893 start-ups per 10,000 residents and the City of Westminster, with 300 start-ups per 10,000 residents.

The bottom five areas were all in the North-East. Wansbeck, Northumberland, had 12 start-ups per 10,000 residents, followed by Redcar and Cleveland with 14. The average across the UK was 40, with an average in England of 42.

The Treasury said that although its figures were the 'most precise measure' available for new business creation, they 'may be disproportionately skewed due to special factors' such as the creation of business headquarters in London