BUSINESS confidence, employee numbers and turnover all increased in Darlington last month, for the first time in two years, the business index shows.

The index, compiled by Clive Owen & Co, chartered accountants and business advisors, in Darlington, shows that months of uncertainty among the town's businesses have come to an end.

Angus Allan, corporate finance director at Clive Owen, said Gordon Brown's budget had contributed to the increase in confidence, because the importance of increases in business growth, particularly in high technology industries was emphasised.

Job losses in the engineering sector were balanced by recent announcements by Amicus Outsourcing, which is creating 500 jobs in Jarrow, South Tyneside, and the international Pizza Hut restaurant chain, which will create a further 200 jobs in Sunderland, helping to boost business confidence.

Mr Allan said: "It is pleasing to see these new jobs being created, despite the implementation of the one per cent increase in the National Insurance contributions from April 5."

Not only has there been an upturn in confidence in recent weeks, but consumers and businesses are also benefiting from supermarket petrol price-cutting wars being led by Asda and Tesco, said Mr Allan.

But, while competition is bringing petrol prices down, increases may not be too far away, because the Chancellor delayed the usual petrol tax increase until October.

Mr Allan said: "Although the situation is very fluid, as we begin the new financial year, businesses in Darlington have had a good month overall. Let us hope this continues as we move towards what economists suggest is a more stable economic climate."

The index assesses local business activity, based on figures filed by a selection of companies in and around the Darlington area over the past month.

Figures compare and assess current business performance with that of January 1999.