NEW organisations to win private-sector jobs for the region are a "likely failure", a government minister warned in an extraordinary leaked letter.

Many 'local enterprise partnerships' (LEPs) lack focus, lack the input of business leaders and are "in danger of failing to aid economic growth", business minister Mark Prisk wrote.

The devastating verdict - in a letter to Business Secretary Vince Cable - was revealed just days after a LEP was given the go-ahead for the Tees Valley and in 23 other areas.

On the day it was approved, deputy prime minister told The Northern Echo it would be a roaring success, saying: "The business people I speak to are hugely enthusiastic."

Behind the scenes, Mr Prisk, a Conservative minister, was giving a very different analysis in the letter to his boss, the Liberal Democrat Mr Cable. A copy was sent to Mr Clegg's office.

The partnerships, of business chiefs and local politicians, are meant to plug the gap when the regional development agencies (RDAs) are axed, in March 2012.

But business groups - including the CBI, the British Chambers of Commerce, the Federation of Small Businesses, the Engineering Employers' Federation and the Institute of Directors - were fiercely critical.

In September, they warned of "fragmentation" and of a loss of economic muscle if key powers - over inward investment, key sector development and European aid - passed to distant civil servants in London.

Now the leaked letter, written on the very day that warning was given to a committee of MPs, has revealed the panic it triggered in the department for business (BIS).

Mr Prisk wrote: "There is a strong view amongst the business community that many LEPs lack the ambition to make significant economic impact, undermining our agenda for growth.

"Key messages I have been made aware of include: a lack of credible business representation; negotiations dominated by local politics; and a lack of a clear focus on economic growth."

The letter concluded: "At worst, the danger is that the CBI and others become detached from this policy, heralding likely failure in large parts of England."

In the event, only 24 LEPs were given the go-ahead, with other, weaker bids - including one for a partnership stretching from Durham to the Scottish border - put on hold.

John Denham, Labour's business spokesman, said: "It's crystal-clear that the government has no coherent strategy for growth. The hasty and dogmatic changes they are ramming through are making the position for business worse."

But a BIS spokeswoman insisted only LEPs that met "expectations" were approved, adding: "Proposals that failed to demonstrate a sufficient level of business support have not been successful at this stage."

She also pointed to the CBI's statement last week, which read: "Business has been a bit sceptical. It is early days, but the government appears to have responded to these concerns."