HOUSEHOLD incomes in Dorset are well below the national average, a new report has revealed today.

The report, compiled from data from four million homes, has shown that the average household income in Dorset is £21,400 a year, £1,800 less than the United Kingdom average.

The survey, which was compiled by market researchers CACI, has also highlighted that Dorset has not faired well compared to neighbouring counties Hampshire, which has a household income of £25,300, and Wiltshire, where earnings are £24,800 a year.

Bill White, chief executive of Weymouth and Portland Chamber of Commerce and Industry, said that the figures did not surprise him and he believes the only way to increase average incomes in Dorset would be from a government cash boost.

He said: "We are currently having an upturn in business in Weymouth and Portland but these figures show that the whole region needs extra government support and funding."

He added: "Figures for average household incomes in Dorset may not be the lowest in the country but without government funding, businesses and other services throughout the county will suffer, which will ultimately reduce income levels even further."

The Wealth of a Nation report has revealed that the average national income has increased by 8.6 per cent to £23,200 since 1998.

But it also highlighted that the national average masks a postcode lottery of wealth and there is an increasing gap between the richest and poorest people in the country.

Barry Allen, of the Union of Shop, Distributive and Allied Workers, said: "There is a possibility that the low figure for Dorset could be related to the lack of highly-paid industrial jobs and office work, combined with low rural wages."

But he added: "I think it is important to say that these sorts of reports are often unrealistic and they can give false impressions.

"People have to remember that the true extent of poverty can be masked by average figures and that London wage rates often inflate national figures giving unrealistic results."

The report shows that many of the top incomes, of over £47,000, are centred in and around London, Cheshire and Hertfordshire. In contrast, areas in Belfast, Liverpool and Birmingham have the lowest annual incomes - under £10,000.

And Cornwall is the poorest county with families earning 88 per cent less than people in Surrey, which was shown as one of the richest with average earnings of £33,400.