A BID for cash to build a light rail network across the Tees Valley was dashed because it would not have created enough jobs, MPs were told today.

Transport minister Mike Penning said the £9.05m application - submitted to the flagship 'regional growth fund' - was unsuccessful because of doubts about its "economic benefit and jobs".

Mr Penning urged Tees Valley Unlimited (TVU), the area's Local Enterprise Partnership (LEP), to put together a better "business plan", before a renewed bid to the £1.4bn fund.

And he suggested the area needed to "brand" itself better in order to succeed, because of confusion over whether it was "Teesside", or the "Tees Valley".

Illustrating that confusion, the minister referred to the "four local authorities" that have jointly formed the partnership and pitched for the funding for the Metro.

In fact, there are five - Darlington joining the four Teesside councils of Hartlepool, Middlesbrough, Redcar and Cleveland and Stockton-on-Tees.

The first phase of the Metro system, to link Teesside with Darlington, was promised £34m of funding by Labour, as part of a much-criticised spending splurge in the run up to the general election.

But only £4.9m of the package was signed off before polling day, mainly for station improvements at Eaglescliffe and Thornaby. That money was finally released in September.

The fate of the remaining £29m - for new stations at Durham Tees Valley Airport and The James Cook University Hospital, in Middlesbrough, along with major improvements to Darlington and Redcar central stations - is in limbo.

Responding to a debate led by Redcar MP Ian Swales, Mr Penning also cautioned against future optimism, saying: "There is only a certain amount of money that the state can provide."

Earlier, Mr Swales said: "It is vital that Tees Valley receives the investment it desperately needs to improve passenger and freight rail transport."