BUSINESS Secretary Vince Cable last night defended the Government’s handling of the North East economy as it was revealed £45m had been ploughed into securing a centre for manufacturing aircraft blades in the region.

Government funding worth millions of pounds has been channelled into the new Rolls-Royce facility at Washington’s Radial Business Park.

It is hoped the investment will harbour the North East’s highly skilled workforce and cut the risk of the engineering giant moving their operation abroad.

But the announcement comes just days after a report by the transport select committee found that a Government under-spend was hindering the region’s efforts to be the electric car manufacturing capital of the globe, while 300 agency jobs were axed from the Caterpillar plant at Peterlee.

Last night Dr Cable said the Government had a clear vision on its policy for the region’s business sector as he considered bids for the latest round of Regional Growth Fund (RGF) cash.

He said: “I think the new round of RGF is on my desk at the moment and there are some really good projects. The North East has so far had the most number of projects and that reflects the fact that there are a lot of very good companies.

“The emphasis in this region is on manufacturing. I can’t predict the outcome but I know the North East is very well placed.”

Dr Cable visited the Rolls-Royce plant to mark the start of a six-year project to build a new advanced aerospace disc manufacturing facility worth millions of pounds.

The facility at Radial Business Park – already home to the re-located BAE Systems which moved from its original home in Birtley to save 400 jobs – will have the capacity to manufacture more than 2,000 fan and turbine discs each year.

Fan discs and turbine discs – which operate at high stress – will be produced at the centre for aircraft including the Boeing 787 Dreamliner, the Airbus A380 and the Eurofighter Typhoon.

Rolls-Royce leaders last night declined to comment on the number of jobs that could be created but said the 20,000 metre sq site would be fully operational by 2017.

Ministers and business chiefs praised the North East for boasting a “highly-skilled” workforce and Dr Cable said the Coalition has spent the money to prevent the manufacturer from using foreign labour.

He said: “We know the aerospace industry is critical, it’s a key manufacturing sector and the North East boasts the most advanced engineering skills of anywhere in the country.

“We have probably the second best aerospace sector in the world and Rolls-Royce is a key part of that. There was a risk that they may go elsewhere and we are always conscious of the fact that leading companies will be able to use staff overseas. We want these products to be made in the UK and that’s a tribute to out workforce.”

Dr Cable said the loss of jobs at the Caterpillar plant in Peterlee was a “matter of great regret” and he defended the Government’s stance on setting up the correct infrastructure for electrical vehicles.

He said: “We are putting a lot into electric vehicles. We have got the £10,000 bounty and there’s support for the infrastructure in charging points.

“The problem is that electric vehicles are not yet on the road. It’s clearly coming and that’s why we’ve put a lot of money into the Nissan Leaf project. In the long term it’s got a fantastic future ... it’s about getting the batteries right and the engine correct.”

Alain Michaelis, chief operating officer of Rolls-Royce and president of the Gas Turbine Supply chain, said: “We are pleased to begin construction on this important new facility which will use some of the most advanced manufacturing techniques to produce hi-tech aero engine components to power the most advanced aircraft operating today.”