THE North East has been told it must sell off regeneration sites and hand the cash to the Government despite an admission that the same rules will not apply to London.

In a letter seen by The Journal, ministers have said that they will not hand councils control of key regeneration sites and told them it is either cash up front or see the sites sold off for a quick sale.

At the same time London mayor Boris Johnson has been told the law will be tweaked to ensure his administration’s ownership of assets across the capital are retained for the capital’s benefit.

Government ministers have been told their decision has effectively created one rule for the North East and other English regions and another for London.

Labour’s shadow business minister Gordon Marsden said: “In comparison to this transfer of assets to London, the way in which ministers are treating the English regions is outrageous. Ministers are starving the regions of access to the key assets they need to push growth, create jobs and stimulate their local economies.”

The assets were previously held by development agency One North East, covering land and building across the region, and held to attract major new employers.

Ministers with one eye on reducing the UK’s debt have ordered a sale, meaning many councils cannot find the cash in time to keep the assets held for the greater good. Any money raised for the sale will not be ring-fenced for the benefit of the region.

Last night Newcastle North MP Catherine McKinnell hit out at Business Minister Mark Prisk over perceived double-standards in a letter he sent to MPs.

In his letter, Mr Prisk said around 20% of development agency assets were already earmarked for sale.

He added: “It is intended that all London Development Agency assets will be transferred to the Greater London Authority. This will give it an important portfolio of regeneration assets to support its new responsibilities.”

Ms McKinnell told The Journal: “The North East is now forced to pay full market value or lose strategic land and property assets vital for our regional economy.

“The Government has clearly recognised the importance of these assets in allowing London to retain those formerly held by its development agency. How can it justify such double standards?

“It is particularly worrying that the Tory-led Coalition is looking to sell off assets including the former Newcastle Brewery site, set to house Science Central, a key development for the future of Newcastle as a Science City.

“This is a quick and short-sighted fix to fill the Government coffers without any thought of the impact on the region’s economy.”

Newcastle Council and Newcastle University have agreed to find £4m to buy out One North East from science central, bringing the total bill for the site to some £67m.

A spokesman for the Department for Business confirmed the letter and added that stamp duty would also have to be paid on assets sold by the development agencies.