IT was November 4, 2004, and the voters of the North-East overwhelmingly rejected the idea of regional government. By a majority of almost four to one, they decided they did not want a North East Assembly.

Or did they? Not according to the North East Assembly, they didn't.

"The election was about the way in which the assembly is organised: should it be through an electoral process, or through the process that happens in all other regions? The decision was: we would continue to have the members appointed as they have been," says Malcolm Bowes, assistant director of the North East Assembly.

This is the assembly created by the Government in 1999, one of eight around the country, as a first step towards regional devolution. A yes vote in the referendum would have seen it replaced by an elected version; a no vote meant it was business as usual.

For the last six years, the assembly has been beavering away, almost unnoticed, from the Guildhall on Newcastle's Quayside. Within days of the referendum result, it became clear it was no mere talking shop, producing a planning framework which will shape the future of the North-East for the next 20 years. It may not be democratic, but it has power.

But some of the 700,000 voters who ticked the no box may have thought they were saying goodbye to regional government. If so, they were mistaken, according to Mr Bowes.

"What they said they don't want, is an assembly to be elected. Some of them may have thought they were making a decision on whether they wanted an assembly or not, but that was not the decision they were making.

"The question was: do you want an elected assembly? The answer was no. If you don't want an elected assembly, then you have an assembly that has its members appointed the way they are now. If there was some uncertainty in people's minds, well...," he shrugs.

The assembly has 72 members, 51 of them politicians, predominantly from local councils, the rest drawn from various spheres, including trades unions, business, education and health. It has a budget of around £2.7m, of which £858,000 comes from council taxpayers, the rest from government. About £1m of its budget is split with the Association of North East Councils, which shares the assembly's 32 staff.

Assembly chairman Bob Gibson, also leader of Stockton Council, is dismissive of suggestions it has no democratic mandate.

"I'm not interested in that issue. The assembly will carry on the work that it has been doing, the same as the other seven assemblies are doing. That's all I'm saying on the issue," he says.

But others are not so eager to move on.

John Shuttleworth, an independent councillor representing Weardale on Durham County Council, called for the authority to withdraw its £84,800 annual funding to the assembly in the wake of the referendum result. His proposal was defeated by 70 votes to two, but he's unbowed.

"I can't get my head around why they want to maintain something that is against the wishes of the people. It is just a gravy train with people with their noses in the trough and they haven't a mandate to do anything," he says.

John Elliott, chairman of the North-East Says No campaign which led opposition to the assembly in the referendum, says if the Government wanted an elected regional assembly it should have just gone ahead and then be judged on its creation at the next election.

"Why go to all the expense of a referendum and then just ignore it? It cost £12m for the referendum but it was a total waste," he says. "The regional assembly is a waste of time: it is a quango that interferes, it does nothing of value but it consumes council tax."

For Mr Bowes, the regional assembly means the North-East can speak with one voice, making it more effective in lobbying for extra investment. And he says the Government requirement to produce a regional planning framework means some sort of regional body needs to exist, to produce a consensus between the local authorities.

"You need some sort of representative body to take those decisions, and the most representative body we have currently got is the regional assembly," he says.

The referendum result may have been the end of a dream for Deputy Prime Minister John Prescott, but it has not stopped the Government's drive towards regional government. A spokeswoman for the Office of the Deputy Prime Minister (ODPM), which funds the assemblies, says some issues need to be co-ordinated over a larger area than a single local authority.

"If the people in the regions are to have a voice and an input to the development of strategies that cross local authority boundaries, then clearly we need regional assemblies to work together for the benefit of their regions," she says.

But this is far from clear to Neil Herron, director of the unofficial North East No campaign. He believes the region's elected representatives, its MPs and local authorities, should be sufficient to tackle the North-East's problems, and for issues which cross local authority boundaries, councils can come together on a temporary basis.

"The regional assembly has no mandate from the people whatsoever, it is an unwanted talking shop," he says.

"This is the biggest political con-trick ever foisted on the people of the North-East, who have got regional government whether they like it or not."

And this is the real problem with the regional assembly, according to John Elliott. Not so much the fact it exists, galling though that is, but that it sends a message to the voters who believed they were being given a choice on whether the North-East should have an assembly.

"They're just ignoring people and then they wonder why people don't bother to vote," he says. "The regional assembly doesn't make any difference: it is the message they're giving that they don't care what people think. They haven't realised the reason people don't vote, and this, more than anything, reinforces that.

"Most people don't feel connected to politicians, and by ignoring that vote in November they're effectively saying we're wasting our time."