LABOUR has seized on “extraordinary” comments from Business Secretary Vince Cable after he ruled out giving Local Enterprise Partnerships (LEPs) multi-million pound pots of money to spend.

Mr Cable’s argued that big decisions on funding must be administered from Whitehall – in direct conflict with the recommendations detailed in a report by Tory peer Lord Heseltine who has proposed handing over £70bn to regional LEPs, enabling them to take the lead in promoting economic growth.

While praising some LEPs – such as the Tees Valley LEP – Mr Cable said their very nature with “five, six or seven business people on the board” meant they were quite small groups and there was an accountability issue in terms of handing over large chunks of public money to them to spend.

Iain Wright, Labour’s Shadow Business Minister and MP for Hartlepool, said: "These are extraordinary comments.

“When they came to power the Tory-Lib Dem Government dismantled [regional development agency] One North East despite warnings from business.

“They promised that their Local Enterprise Partnerships would devolve decisions down to local areas and yet now the Secretary of State is saying he wants to keep all the power in London.

“For Local Enterprise Partnerships to have any chance of success they need to be given the powers and resources to do the job they've been tasked with.

“Sadly from Vince Cable's comments it seems that he's unwilling to back his own Government's idea."

Lord Heseltine’s report has already been accepted in principle by Chancellor George Osborne, who is poised to announce limited spending pots in June.

Middlesbrough South and East Cleveland Labour MP, Tom Blenkinsop said Mr Cable’s comments were an “utter insult” to business people who sat on the LEPs, “people who in their day-to-day life make multi-pound decisions”.

He said: “In effect Mr Cable has told Teesside to whistle in the wind for real cash to invest in local industry and therefore create much needed jobs.

“Put simply this is a mess and it is becoming increasingly difficult to know who is calling the shots here - is it the Chancellor or Vince Cable?”

The Northern Echo contacted representatives of both the North-East LEPs, but they were not able to comment.

A spokeswoman for Tees Valley Unlimited, said it could not comment on Government policy at this time because of purdah, a reference to Thursday’s local elections.