THE region would be handed huge spending pots - and control over skills budgets, infrastructure funds and job-creation schemes - under radical plans unveiled today by Lord Heseltine.

The Conservative peer will challenge David Cameron to end decades of power-grabbing by Whitehall by finally unleashing towns and cities to drive their own destinies and deliver economic growth.

Central to the vision is a call for 'local enterprise partnerships (LEPs) - widely seen as toothless talking shops - to control budgets worth £14.5bn-a-year across England.

Every government department would be forced to hand over funding streams that support growth, delivering annual budgets of hundreds of millions of pounds to each LEP.

Speaking to The Northern Echo ahead of today's launch, Lord Heseltine said: "London didn't make this country - the provincial cities were a vital ingredient.

"Now, we have an economy run in this country - unlike in any other advanced capitalistic economy - in the capital city. The point of these reforms is to bring back, in partnership with local authorities, the role of the wealth creators."

However, the proposals have already raised heckles in government, which stripped the regions of powers only two years ago, when it axed regional development agencies (RDAs).

Lord Heseltine - a supporter of devolution for 30 years - said he was hopeful his ideas would be accepted, adding: "Why did they set me up in the first place? I come with baggage!"

But he admitted it was too late for ministers to change course in this parliament, saying: "It's perfectly true that it won't lead to cash on the ground until 2015."

The 228-page report, entitled 'No Stone Unturned', recommends: * LEPs to bid for "single funding pots" for a minimum of five years, from 2015.

* Those pots to contain cash from up to 59 different 'funding streams' - everything from local transport, housing and skills budgets to welfare-to-work schemes and the regional growth fund.

* Unitary local authorities in every area, sweeping away the two-tier structure of counties and districts in the likes of North Yorkshire.

* Legislation to allow "conurbation mayors" - to run larger areas, such as Tyne and Wear - where they are wanted.

* Extra legal powers for Chambers of Commerce to run business support networks.

* LEPs to approve courses run by Further Education Colleges, to ensure they "reflect local labour requirements".

* 'Local Growth Teams', made up of clusters of LEPs, to "identify economic opportunities" - likely to be criticised as recreating the RDAs.

* Ministers and civil servants to have formal links with individual LEPs - visiting them regularly.

* New powers for regional directors of watchdog Ofsted to tackle 'sink schools'.

Lord Heseltine said the government was already moving in the right direction, not least with the 'City Deals' struck with the biggest cities and now offered to the Tees Valley, devolving some responsibilities.

But he added: "They have dipped their toe in the water - now is the time for a major commitment."