A REGENERATION company has been cleared of maladministration following an investigation by Government officials.

But a politician who instigated the probe said last night that it confirmed his fears over "incompetence and a failure to observe normal standards of conduct".

Stockton North MP Frank Cook wrote to the Office of the Deputy Prime Minister with his concerns about the operations of the Tees Valley Regeneration (TVR) company.

Mr Cook raised questions over the appointment of board members, potential conflicts of interest and the awarding of contracts by the agency.

After receiving a reply from Lord Rooker, Minister for Regeneration and Regional Development, Mr Cook said last night: "The response to my key questions could not be clearer."

The letter says the investigation has shown there was not a proper register of board members' interests, and that appointments to the board were not made in accordance with proper principles.

It also reveals that the engagement of a company, headed by a board member, to provide recruitment services to Tees Valley Regeneration, was not made through the normal tender process.

Bosses at TVR described the failings as "a few housekeeping areas that need to be attended to" but said they were to be expected in such an un-tested venture, which was established in 2002.

Mr Cook said: "The Minister does say that a review carried out by the regional development agency One NorthEast and the inquiries from his own officials found no evidence of impropriety.

"But what his findings do illustrate is that there has been a significant degree of incompetence in the running of TVR up to this point - and I believe those responsible for that situation should be called to account."

Mr Cook called for a register of members' interests to be made public, along with minutes and agendas of board meetings, which he has demanded but never been shown.

A spokesman for One NorthEast said it was content the problems highlighted by its governance review of TVR were being addressed.

Acting chairman of TVR, Graham Roberts, said: "We fall between two stools - we are not a local authority and not exactly like a PLC although we do try to behave much more like that - and it is probably not very surprising there are one or two teething problems.

"There are some shortcomings we will hold our hands up to, but they are being attended to. We spend public money so we don't have a problem with being closely watched."

Mr Roberts said TVR should be judged on the success of its five core projects.

They are the development of Middlehaven in Middlesborough, the North Shore site in Stockton, Victoria Harbour in Hartlepool, the Central Park site in Darlington, and the business, hotel and leisure development at the 250-acre site at Durham Tees Valley Airport.