A ROW blew up last night after a Government minister promised the region’s councils a “huge wodge” of cash for new transport schemes.

Norman Baker said local authorities would be able to tap into the £560m sustainable transport fund for projects to boost economic growth and make transport eco friendly.

The Transport Minister also pledged a shift in power that would make it easier for town halls to improve their transport systems, with a cut in funding sources from 26 to four.

He told The Northern Echo: “This is a huge wodge of cash that demonstrates the value we place on measures to improve economies and cut carbon.”

But Labour immediately accused the Government of “smoke and mirrors” and an attempt to hide a large cut in overall funding for local transport improvements.

The Department for Transport acknowledged that only £80m of the £560m fund would be available in the next financial year, starting in April.

Meanwhile, the small print of last November’s spending settlement reveals that £95m will be cut from block grants to councils in 2011-12, down from £473m to £378m.

Last month, North-East councils were warned that their transport funding would be cut by £18m from April, while North Yorkshire will lose £3m.

Maria Eagle, Labour’s transport spokeswoman, said: “This is smoke and mirrors, because the Government is giving back much less than it is taking away.

“In reality, both capital and revenue spending are being cut and ministers are trying to divert the blame for the cuts that they are imposing onto local councils.”

Announcing the “unprecedented” fund, Mr Baker urged local councils to bid for cash for projects that would:

● Encourage children to walk and cycle to school, rather than be driven;
● Create more bus lanes, to encourage more people to leave their cars at home;
● Make town centres more attractive to visit on public transport – amid evidence that those shoppers spent more than people who arrived by car;
● Tackle poor transport in rural areas – pointing to a scheme that allows apprentices and trainees in the Yorkshire Dales to borrow a motorcycle.

Mr Baker said: “We are not being prescriptive. Our message to local councils is to do something different, because there is no shortage of money for them to do that.”

However, the minister played down earlier suggestions that the fund could help launch major schemes, including stalled light rail projects such as the Tees Valley Metro.

Funding awards are expected to be “at the low end of £5m to £50m”.

Mr Baker said: “Light rail schemes are not part of this strategy because the money will not stretch that far.”