Company directors have called for the Government to scrap its plans to set up elected mini-Parliaments in the English regions.

According the the Institute of Directors (IoD), John Prescott's regional assemblies will only add another layer of bureaucracy.

They have added their concerns to those of the CBI, which claims English devolution will produce "expensive talking shops" with little popular support.

The IoD's Parliamentary adviser, James Walsh, said British business wanted to see taxes and bureaucracy reduced. "Less Government not more," he said.

He claimed a ''typical assembly'' would employ 200 staff and cost £25m a year to run. Mr Walsh said: "That represents a significant new layer of bureaucracy."

The Government should concentrate on giving existing regional development agencies more power to focus on business priorities, he said.

"These practical measures would be of greater benefit than establishing a series of mini-Parliaments across the regions of England."

The Deputy Prime Minister is to announce in June which regions have shown an interest in regional government.

It is widely expected the North East will be one of those allowed to hold a referendum.

If there is a yes vote, any assembly will have powers in job creation, transport, housing, tourism and culture.