A government department based in Darlington would boost the regional economy and could save taxpayers millions of pounds, according to a leading economist last night.

And civil servants would save thousands on their mortgages, education costs and living costs if they relocated to the town.

Professor Fred Robinson, economics and regional employment expert from the University of Durham, said plans to break up Whitehall and devolve departments into the regions should include the North-East. The Northern Echo launched its Devolve to Darlington campaign to highlight the strategic and geographic importance of the town's location at the heart of the North-East region.

And not only would the move save taxpayers money, it would also be of benefit to the thousands of civil servants who pay over-inflated London prices for homes, private education and transport.

Andrew Potter, of JW Wood estate agents, said: "People who move into the area and are looking at the upper end of the market, like these civil servants might be, could exchange their three-bedroom semi in London for something really quite special in the villages around Darlington for the same price.

"Darlington is so central to the North-East region, it is a pivotal point. It's great for house buyers moving into the region because it is so close to the A1, the A66, the mainline railway, and of course the airport, and it is half-way between Leeds and Newcastle, with Teesside close by."

A plush three-bedroom apartment in Trinity Mews, Darlington, came in at £180,000, but a similar one in South Kensington, London, cost £2.5m.

And a three-bedroom family home in Carmel Road, Darlington, was just £245,000, compared to a similar house in Wimbledon, London, which was on the market for £625,000.

Prof Robinson said: "Homes are obviously one cost cut, but also education. There are many civil servants who don't want to send their children to the inner-city schools in London, and pay a fortune for a private education.

"But the state-run schools in Darlington are mostly very good. And pre-school childcare is significantly cheaper up here than in London. Taxpayers' money would also go further in a Government department in Darlington, he said, because of reduced living costs, cheaper commercial property and rates.

"There is a high turnover of staff in London," said Prof Robinson. "Here it is less, which makes a more efficient workforce, and you are not paying as much for agency staff."