Scotland, Wales and Northern Ireland were allowed access to extra EU funding to beat the recession. But the Government refused to allow the North East to bid for the cash, which could have been invested in projects to stimulate the local economy and create jobs, such as the Ouseburn barrage.

North East Euro MP Fiona Hall said:

"This is daylight robbery by the Government. Millions of pounds which could have been invested in the North East are being siphoned off into the Treasury's coffers.

"North East England has always struggled to get the funding it deserves from the Government. This is the last straw. It is outrageous that Labour Ministers have blocked European funds intended to help our region at a time of crisis."