THE region’s economic regeneration agency would be scrapped if the Tories get into power, Shadow Business Secretary Ken Clarke revealed yesterday.

The Conservative Party plans to replace the quango with panels made up of local authority leaders and business people.

It would mean the end of One North East, which business leaders have said could delay the region’s economic recovery from the recession.

Mr Clarke said: “People connected to the regional development agencies are rather upset that we are going to replace them, but the fact is they are leftover from John Prescott’s dream of regional government.

“You can’t defend quangos as a key part of regenerating the British economy. You need local leadership.”

Mr Clarke was speaking at a topping out ceremony of the 4,000sq metre Cobalt Data Centre Campus in North Tyneside.

One North East said it was unable to comment on the plans because public bodies are unable to make statements in the run-up to an election.