A £15m fund to help set up small and medium-sized businesses was launched before an audience of the region's leading businessmen yesterday.

Hilary Armstrong, North-West Durham MP and Government Chief Whip, launched the new Capital North East fund at the Riverside cricket stadium in Chester-le-Street.

It is hoped the new scheme will encourage an entrepreneurial spirit in the North-East which, research by Barclays Bank has shown, has one of the worst small business start-up rates in the country.

The fund will be run by Capital North East, which is managed by Northern Enterprise Ltd and has helped a number of small and medium-sized businesses.

Ms Armstrong said that in the past the people of the coal and ship-building dominated North-East were encouraged simply to fit into a team and not be too entrepreneurial, but that attitude had to change. She said: "This fund is a real triumph for the region and is way ahead of other regions. The North-East can be, and I think will be, a region that is leading the rest in renewal."

Barclays Bank has provided £4.5m, £3m has come from the Local Authority Pension Funds, £3m from the European Investment Fund and £4.5m from the Department of Trade and Industry. About 100 North-East companies are set to benefit over the next five years with initial investments ranging from about £50,000 to £250,000. There is a possibility of a further £250,000.

To find out more call 0191-442 4300 or (01642) 246345.