THE North-East has been given the clearest hint yet that it will get the chance to vote on a regional assembly within the lifetime of the next Parliament.

Former Cabinet minister and key Labour insider Peter Mandelson will today throw his support behind elected regional government as the only way to unlock the North-East's potential.

The Hartlepool MP will use a speech in his constituency to call for a referendum on the proposal, as a "unique opportunity" to express the North-East's view.

The keynote speech will fuel speculation that Labour's election manifesto will include a commitment to hold a referendum on regional government within the lifetime of the next Parliament if the party remains in office.

His comments come a few weeks after Deputy Prime Minister John Prescott, on a visit to Middlesbrough, announced that regional development agencies would have greater spending powers.

But Mr Prescott, a high-profile supporter of regional assemblies in the past, refused to be drawn on how far Labour would go to create a North-East parliament.

Despite Mr Mandelson's resignation as Northern Ireland Secretary in January, he is still seen as a key figure within the party, and his views will be taken as a sign of the thinking in the upper echelons of Government.

Mr Mandelson, who will be speaking at Hartlepool's College of Further Education, said an extra 22,000 jobs had been created in the North-East since Labour took office, but the region could still do better.

He said: "For each part of the region to do better economically, we would need to create a focus for the region as a whole.

"Hand-in-hand with economic change and modernisation must come change in political arrangements and institutions, and my argument is we need to form some sort of regional authority.

"Regional government would give focus to our efforts to stimulate enterprise, long-term employment and prosperity."

Mr Mandelson said regional government should not be at the expense of existing local authorities.

"We need to decentralise power to both regional and local levels and to distribute power to where it is most effectively exercised and I believe that greater focus at regional level is justified."

He said the North-East had done well under a Labour Government but it was now time to look at how to make further progress.

"If Hartlepool and the North-East as a whole is to make the fundamental breakthrough that we need, then we have to deepen economic change and our harnessing of new information and communication technologies.

"We will continue to perform below our potential and lose out in comparison to the south, and also to Scotland, if we do not modernise our own political institutions so that we can provide greater focus, a stronger voice and more political clout," he said.

Mr Mandelson said voters should be given the opportunity to decide whether they wanted a form of regional government.

He added: "I speak mainly of the North-East because that is the region I know best.

"But I think it is a view that could be applied to other regions, but that is for the people in those regions to decide.

"I believe the people in our region should be given the chance to consider different arrangements. If we were to have a referendum in the North-East it would offer a unique opportunity for us."