Labour's London 'obsession' has hit Yorkshire, says Clegg

Addressing business leaders in Leeds tonight, he will accuse both Labour and the Tories are being "obsessed" with the City for the past 30 years, leaving Yorkshire to suffer.

But as the country creeps its way out of recession, he will demand a rebalancing of the economy, away from "financial wizardry" and towards giving manufacturing a boost.

"There are nearly 100,000 square miles in Britain," he will say. "For the last 30 years, Labour and Conservative governments have been obsessed with only one of them: the City of London.

"There was a time that Yorkshire was at the heart of the nation's economy. But it's been neglected, and people here have suffered as a result.

"Dazzled by the bright lights of the City, Labour has left Yorkshire behind. Declining industry, fewer jobs, more hardship: the people of Yorkshire have been betrayed. It has to change."

Mr Clegg's speech to around 500 business people at the annual dinner of the Leeds, York and North Yorkshire Chamber of Commerce tonight comes as the Liberal Democrat bill themselves as the only party of genuine economic reform.

His comments echo those made earlier this week by the party's Treasury spokesman Vince Cable, who pledged "radical changes" to the tax system and a break-up of the banks to ensure the economy is more balanced in the future.

Mr Clegg, MP for Sheffield Hallam, has already been forced to admit several key policy pledges are being put on the back burner because of the economic crisis.

Tonight, he will insist that it is a myth to claim the UK's days of manufacturing are over, and call for more Government support to make the sector "the backbone of our nation's economy" again.

With the prospect of a hung parliament leaving the Liberal Democrats holding the balance of power after a general election, he will call for financial and political powers to be devolved to help cities like Leeds and criticise taxpayer-backed banks for still failing to lend enough.

"Since the multi-billion pound bailout, we own some of our big banks, and we are propping up the rest of them through the taxpayer guarantee," he will say.

"It is outrageous that thousands of businesses and home owners can't get credit on fair terms. The taxpayers have representatives on the boards of the banks we own or part-own. They must use their influence to immediately get the banks lending again."