TWO of the key organisations in regional government are to separate in a shake-up following the No vote in last year's referendum on a directly-elected assembly for the North-East.

At a meeting in Newcastle's Guildhall yesterday, members of the Association of North East Councils, which represents the region's 25 local authorities, and the unelected North East Assembly voted to separate in June.

The decision follows a review of the work and staffing of the two organisations in the wake of the region's rejection of the proposed assembly.

They will operate with separate budgets from April.

The groups have a total annual budget of over £2m, financed largely by government grants and by £80,000 a year paid by councils around the region.