THE Government’s devolution policy is in crisis with an integral organisation facing closure, it has been claimed.

Shadow Business Secretary Chuka Umunna says The LEP Network, which oversees the UK’s 39 local enterprise partnerships (LEPs), could close in two weeks after its chief executive quit amid unreasonable Coalition demands.

The body works with the North East LEP and Tees Valley Unlimited (TVU) and aims to link together LEPs, which replaced regional development agencies (RDAs), such as One North East.

TVU bosses played down the effects of any changes to the network, with the Government praising its contribution.

However, LEP Network chief executive Alison Porter will leave next month, highlighting personal reasons for the decision, though it has been claimed by some it is down to the strain of increased Coalition pledges to give more areas local powers.

Alex Pratt, LEP Network management board chairman, told The Northern Echo it needed more Government funding and support to continue helping them.

He said: “The workloads of LEPs and the network have increased considerably given the enhanced focus on local growth enhancement, including the addition of growth hubs and skills and employment pilots.

“The chief executive was recruited in a part-time capacity, which is now unsustainable given the demands on the role, the devolution discussions and additional planning required in advance of an election, and has decided to step down.

“We are in discussions with Government around the need for increased support.”

Mr Pratt was speaking after Mr Umunna cited a letter from the LEP Network in the House of Commons, saying it could close in two weeks, with £5,000 grants from every LEP and existing Coalition support not enough.

In a heated Commons exchange, Mr Umunna accused Business Secretary Vince Cable of overseeing a chaotic regional policy.

He said: “The network is now officially overwhelmed and preparing to throw in the towel.

“Four years ago you said your regional policy was Maoist and chaotic; does this not demonstrate that very little has changed?”

However, Dr Cable argued the LEPs are doing a better job than RDAs.

He said: “The local enterprise network is working exceedingly well.

“They are of course voluntary organisations and some of them are outstanding and innovative, others struggle - as this one has done.

“It’s much better we have a regional network that is business-led and related to the geography of the area, which the RDAs manifestly did not have.”

Despite the worries over the networks's future, a TVU spokesman said it would not be affected.

He added: “Our successes around City Deal status and other business-boosting initiatives show we are and will continue to punch well above our weight to help diversify and expand the economic base of the area.

“We support the LEP network and will continue to work with them.”

The North East LEP told The Northern Echo it did not want to comment.