THE fight was on last night for the North East and North Yorkshire to win a share of 20,000 civil service jobs which Gordon Brown confirmed were moving out of overheated London.

The Chancellor announced that government departments had identified a total of 20,030 posts to be relocated to the regions over 15 years, as demanded by an independent study.

The Department of Environment and Rural Affairs led the way by pledging to shift 250 jobs to Yorkshire, although it would not reveal exactly where.

But only 950 jobs - seen as a powerful driver of economic growth - have so far been found new homes. It leaves the destinations of 19,080 still to be decided.

A study earlier this year, by property consultants King Sturge, picked out

Middlesbrough, Stockton-on-Tees, Sunderland, Newcastle and North Tyneside as good alternative locations.

Speaking in the Commons, Mr Brown said: "I know that towns and cities across the country will want to make their case.

"I can also announce that, for all departments making future job decisions, our policy will be a presumption in favour of location in the regions."

Around 230,000 civil servants, about a third of the total, are based in

London and the South East, a tally that has grown by four per cent since

1997.

Most are expected to remain in the area even if their posts are relocated -

creating highly-prized vacancies in regions with higher jobless totals.

Yesterday, unveiling three-year spending plans, Mr Brown announced his own Treasury department would shift 5,000 jobs out of the South East.

A further 4,000 will move from the Department for Work and Pensions, 3,900 from the Ministry of Defence and around 1,000 each from health, education and trade and industry.

Darlington, Hartlepool, Middlesbrough, Redcar and Cleveland and Stockton had joined forces to argue for an entire government department devolving to the North East.

But, in the event, Darlington and Gateshead - as well as York and Harrogate - missed out on a recommendation.

The chancellor also announced tens of thousands of civil servants would face the axe in order to boost spending on frontline services - prompting immediate threats of industrial action from angry union leaders.

Unveiling his spending totals for the next three years, Mr Brown said the cuts in ''back office'' jobs would save £21.5 billion-a-year, helping to fund ''the longest sustained investment in public services for a generation''.

He set out plans to increase departmental spending by more than £80 billion by 2008, with increases for defence, security, childcare, transport, housing and policing.

The Public and Commercial Services Union (PCS) said that cutbacks on an such a large scale would cause ''carnage'' and warned that it could not rule out industrial action.

The Tories, however, dismissed Mr Brown's statement as a ''manifesto for fat government and fake savings''.

In the Commons, the Chancellor announced that a total of 84,150 jobs would go in the civil service, with a further 20,000 to be cut from the devolved administrations in Scotland and Wales and the Northern Ireland Office.

Meanwhile, claims by the 'Yes 4 the North East' campaign that Mr Brown's speech paved the way for extra powers for regional assemblies were dismissed at Westminster.

The Chancellor's spending review went no further than previous ministerial speeches in pledging only to "consider" responsibilities over transport, skills and training, sources said.

However, Mr Brown did announce extra powers for the regional development agency, which would, in turn, form part of the assembly's remit.

Overall, he said, departmental spending would rise by £61bn to £340bn in 2008, of which £37.5bn had already been allocated to health and education.

Spending on national security would rise from £1.5bn to £2.1bn by 2008, including the recruitment of 1,000 extra intelligence officials.

Two-year-olds in 500 areas of the country will receive free nursery education and £100 million from capital funds will go towards building new children's centres, providing child care.

Local councils will get three-year budgets to help them plan ahead and care alarm systems would be installed in the homes of an extra 160,000

pensioners.

Plans will be unveiled next week by Home Secretary David Blunkett for an extra 20,000 community support officers by 2008.

The Public and Commercial Services Union (PCS) described a cut of 84,150 civil service posts as "carnage" and warned it could not rule out

industrial action.