TORY business chiefs are trying to bounce the people of the North-East into accepting a ‘metro mayor’, a Labour MP has claimed.

Kevan Jones, the North Durham MP, hit out at a letter – organised by a “failed” Conservative candidate – warning that the region will be left behind if it continues to defy George Osborne.

Around 70 business leaders signed the letter, which followed the Chancellor’s warning that areas rejecting cross-border mayors would be denied significant devolution of powers.

It was organised by millionaire businessman Jeremy Middleton, who argued the North East Combined Authority (NECA) lacks accountability without a powerful, directly-elected leader.

However, the policy is hugely controversial, because it would mean a single mayor ruling from Newton Aycliffe, County Durham, up to Berwick – a vast area of more than one million people.

COMMENT: The North-East needs a considered debate based on pragmatism, not political dogma 

Mr Osborne is also keen to open talks with the five Tees Valley councils – Darlington, Hartlepool, Middlesbrough, Redcar and Cleveland and Stockton-on-Tees.

Intervening in the Commons, Mr Jones attacked the Government’s plans to devolve power while making huge funding cuts as a “cynical” attempt to pass the buck and the blame.

And he described Mr Middleton’s letter as “the Conservative party machine in the North-East gone into overdrive”, to sway elected local councillors.

Mr Jones said: “I am sorry but we in the region need to have a debate about how we devolve those powers.

“I gently say to business, ‘Do not be used by someone like Mr Jeremy Middleton who clearly has a political agenda of his own’.

“There is a cynical side to the Government’s approach to devolution and it goes like this: ‘You devolve powers because you devolve responsibilities - but you don’t devolve the funds to actually undertake them’.”

Mr Middleton, who runs the venture capital firm Middleton Enterprises, has lost a succession of North-East parliamentary, local and European elections as a Conservative candidate, dating back to 1997.

Other signatories include Graham Robb, of Darlington-based Recognition PR, Robert Forrester, chief executive of Vertu Motors, and North East Local Enterprise Partnership board members Paul Varley and David Land.

Yesterday, the Chancellor repeated his “mayors or bust” message, after Greater Manchester was forced to accept the model as the price of devolution.

He told MPs: “If we are to see a massive transfer of power from national Government to local government, there has to be a single point of accountability - someone who carries the can and drives the process forward.”

During his speech, Mr Jones also attacked the SNP for pushing for extra powers while clinging onto the Barnett Formula, which delivers much higher public spending in Scotland.

Condemning that “mealy-mouthed” approach, he said: “I am sorry, but that will not happen.”