COMMUNITIES Secretary Eric Pickles has been accused of preparing a slush fund to reward southern Conservative councils at the cost of deprived North East neighbourhoods.

Durham North MP Kevan Jones made the claim in the House of Commons amid continuing efforts to try to ensure millions of pounds are not denied to the North East as part of a change in how business rates are spent.

Mr Pickles and his Department for Communities and Local Government will allow councils to keep the money they collect in business rates, ending the current system of the Treasury redistributing the funding based on each council’s needs.

North East councils need that redistribution in order to add around £400m to pay for day-to-day bills. With the region having a lower number of businesses to tax than other parts of the UK, the fear is councils will be forced to cut jobs and services once again if Mr Pickles is handed “a blank cheque” to spend how he wishes.

Ministers have so far promised to ensure no authority loses out in the first year of changes, but what happens after, Mr Jones said, remains open to manipulation.

Pushing local government minister Bob Neill to be clear on just how extra funding will be handed out, Mr Jones said: “It will not come as a great surprise to members that I do not trust the Secretary of State.

“He is a very political individual who is clear in his philosophy – he will help people who support the Conservative party at the expense of northern councils. He does not care whether those councils thrive or not.”