ONE of the region's leading business organisations says the Chancellor must learn the lessons of his predecessors to avoid a return to the boom and bust era.

The North East Chamber of Commerce (NECC) warned against a return to the economic disaster of the 1980s.

Gordon Brown is expected to make pre-election pledges to tempt the electorate ahead of the General Election, which is tipped to be on May 5.

But the NECC urged Mr Brown to heed the warnings of the past, when over-ambitious promises by then-Chancellor Nigel Lawson sparked rocketing inflation and crippling interest rate rises.

NECC chief executive George Cowcher said: "Tony Blair will go to the country in May proclaiming the message that his Government has handled the economy strongly.

"The Chancellor should guard against slipping into cheap election vote-winning by offering concessions that could ultimately destabilise our current position."

Mr Lawson announced pre-election tax cuts of £2.6bn and a planned reduction in Government borrowing.

Mr Cowcher said: "Nigel Lawson got his fingers burnt with his promises, which ultimately everyone paid for. The forthcoming Budget should be based on strong economic principles and not fall foul of pre-election nerves."

The NECC wants to see the Chancellor invest more money in the region's transport infrastructure, reduce the regulations burden on businesses, increase funding to work-related training and streamline business support services.

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