THE best hospital trusts in the region are to be given powers to set up their own businesses and profit from any new technology they develop, it was revealed yesterday.

The top 35 trusts in the country, four of which are in the North-East, will be free to spend extra cash on developing services and rewarding staff.

The announcement was made by Health Secretary and Darlington MP Alan Milburn after the publication of the Government's new performance league tables.

The tables are the first nationwide assessment of performance in the NHS, and examine a range of criteria from cleanliness to patient waiting times and financial performance.

The best trusts - including North Tees and Hartlepool, Northumbria Health Care, South Durham Health Care and South Tyneside Health Care - received three stars. The worst got no stars.

A key boost for the best performing trusts will be a slice of a £155m Performance Fund.

Three-star trusts will be able to set up their own businesses and retain copyright on any new technology they develop. They can also keep the money from any local land sales, but will not be allowed to introduce charges for patients.

Mr Milburn said the worst 12 performers, none of which are in the region, will have a strict deadline to improve within months. If they fail, trouble-shooting managers from the best trusts will compete for the franchise to turn their performance around.

Mr Milburn said: "We want to see other hospitals learning from South Durham and North Tees and Hartlepool, and believe this new review of hospital performance will help improve the NHS throughout the country."

John Saxby, chief executive of the South Durham trust, said: "Good management throughout the organisation has supported the work of front line staff in achieving this three-star rating. It is a credit to everyone in the trust."

Ian Dalton, director of performance management for the NHS Northern and Yorkshire region, said: "The fact that we have got such a high proportion of three-star awards is a tribute to the tireless efforts of front-line staff."

Joan Rogers, chief executive of North Tees and Hartlepool NHS Trust said its three-star rating was "something that local people should be really proud of."

Among the poorer performers was Scarborough and North East Yorkshire Health Care NHS Trust, which received one star.

Gilly Collinson, communications manager, said issues such as the number of cancelled operations due to lack of beds and patient waiting times had since been addressed, thanks to three new wards.

"Obviously, we are disappointed," she said. "We have very friendly and hard working staff, and I don't think there's anything in the tables which either commends or criticises that aspect."