A £3.6bn fund to invest in towns came under fire during a debate in Parliament over concerns about a lack of transparency and impartiality.

So far seven towns in the North-East have been earmarked for funding from the Government’s Towns Fund, including Bishop Auckland, Blyth, Darlington, Hartlepool, Middlesbrough, Redcar and Thornaby.

A debate was held in Parliament about the fund on Thursday, during which Labour MP Alex Cunningham, described the concerns as “well founded.”

Mr Cunningham, who has previously criticised the transparency of the scheme after questioning why Billingham, which falls within his Stockton North constituency, failed in its bid for funding while that of Thornaby’s had been successful, said that decision had led to confusion locally.

He said: “The towns fund might be a good idea, but the lack of transparency in decision making has led to understandable concerns about the impartiality of the process, and from what I have seen of it in the Tees valley, those concerns are well founded.”

Accusing ministers of passing over some areas in favour of their own, he added: “It is time for fairness in the system; time for real, true levelling up and proper resources; and time for towns like Billingham to get the support that they need.”

Speaking later in the debate, Simon Clarke, the Conservative MP for Middlesbrough South and East Cleveland, who is a member of the Middlesbrough town deal board, said it was “nonsense” that his constituency was disadvantaged, pointing to Stockton’s provisional funding offer of £16.5m from the Future High Streets Fund.

He said: “The towns fund is a great Conservative policy, targeting investment at proud communities that have not shared equally in our country’s success. It is a core part of levelling up—improving facilities, enhancing economic opportunity, unlocking private sector investment and boosting pride in place.”

Last year, the cross-party public accounts committee issued a report saying a lack of transparency in the process has fuelled accusations of political bias, and said it was "not convinced" by the rationales for selecting some towns and not others.

Adding to the debate Mary Foy, Labour's MP for Durham, said the fund was a "drop in the ocean" when compared to local government cuts of £15bn over the last decade.

She said: “The towns fund is essentially a sticking plaster over the gaping wound that is the catastrophic cuts to local authority funding under successive Conservative Governments. The £3.6 billion fund is simply a drop in the ocean compared with the estimated £15 billion of cuts to local authorities over the past decade.”