David Frost, director-general of the British Chambers of Commerce, called for a new generation of enterprise zones offering tax breaks and a less onerous employment regulation regime for new businesses trying to set up in less prosperous regions. Financial Times

Addressing the organisation’s annual conference in London yesterday, Frost said that the UK had become divided between south-east England and the rest of the country, parst of which were being left behind.

Twice as many businesses were formed per head of population in the Thames Valley as in the Tees Valley and a 'dependency culture' was being perpetuated in the regions.

'In the 1980s we had enterprise zones which successfully transformed many of the areas worst hit by the decline of large-scale industries,' he said. 'Could we not be experimenting in areas with the very worst levels of dependency – high unemployment and low levels of enterprise – with zones where companies that started up could be exempt from not just business rates, but also employment legislation and national insurance contributions?

'We need to reinvest a spirit of enterprise in areas outside London and the south-east.'