'Fire sale' fears over assets of Yorkshire Forward

Fears were raised yesterday that the Government would try to sell off some assets and keep the proceeds in Whitehall when it warned there would be no "automatic presumption" they would be handed over to councils or new economic partnerships when Yorkshire Forward is abolished – and identified "deficit reduction" as a factor in any decisions.

Talks began some time ago between the development agency and councils over what to do with its portfolio of assets when it is closed in 2012 but the Government has now taken control of the process, sparking concern from MPs and council leaders that the region could lose out.

The portfolio includes the Tower Works regeneration site in Leeds, Barnsley's Metropolitan Centre, the Odeon site in Bradford which is primed for redevelopment and the Cable and Wireless Building in Leeds.

The Government says its aim in dealing with assets will be to get "the best possible outcome for the locality" but says decisions must be "consistent with achieving value for the public purse".

Hull City Council leader Carl Minns said: "The assets should stay locally, never mind in the region. If you look across the whole of Yorkshire some of these are prime strategic sites for redeveloping our towns and cities and just disposing of them in a fire sale at the bottom of the market is bad financially, illiterate in terms of economic regeneration and it's foolish."

Leeds West MP Rachel Reeves said: "Instead of a fire sale of these assets they should be kept in our region for local people to determine how they can best be used to support growth."

Concerns over the future of the assets – which also include a host of South Yorkshire's former coalfields – came after the launch of the coalition's White Paper on Local Growth, in which Ministers set out their plans to boost economies outside London and the south east.

Business Secretary Vince Cable gave the green light to 24 Local Enterprise Partnerships being set up – including in Leeds and Sheffield City Regions – to take charge of economic development after the abolition of nine regional development agencies which the Government insists have been ineffective. But he urged officials in the Humber to "get their act together" after rejecting rival bids.

Deputy Prime Minister Nick Clegg also invited the first bids to the 1.4bn Regional Growth Fund – aimed at developing the private sector, particularly in areas highly reliant on public sector jobs, but providing only a third of the funding regional development agencies enjoyed.

Shadow Business Secretary John Denham said the plan was a "shambles" and the result of "reckless" cuts, adding: "This statement cuts the resources for regional development by at least two-thirds. The regional growth fund is a pathetic fig leaf to cover the absence of any growth strategy."

Chief Executive of Yorkshire Forward Thea Stein said the agency was working with local authorities in the region to identify options for transfer and disposal of assets "that offer the prospect of ensuring that the region benefits from those transfers and disposals".

Agency's treasure chest of sites

Barnsley Metropolitan Centre – bought for 30.7m.

Cable and Wireless Building, Leeds – 12.9m.

Tower Works, Leeds – 10.5m.

Leodis Court, Leeds – 5.9m.

Land at Rockingham, South Yorkshire – 3.9m.

Porter Brook Site in Sheffield – 3m.

ESS site, Burn Airfield, North Yorkshire – 2.9m.