Business Secretary Vince Cable yesterday savaged Lord Heseltine’s plan to hand West Yorkshire a multi-million pound ‘spending pot’, saying: “That’s not going to happen.”

Mr Cable said local enterprise partnerships (LEPs) were simply not capable of handling huge sums of public money, as the Tory peer had proposed.

The Minister pointed to key spending areas in his own department – innovation funds and skills budgets – that must be administered from Whitehall to ensure value for money.

And he criticised Lord Heseltine for not being truly radical by proposing tax-and-borrowing powers for local councils, instead of simply a different “carve up” of existing spending.

Mr Cable said of the £70 billion Heseltine plan: “We were never going to go down that road – and we won’t be going down that road.”

Leeds City Region – covering Bradford, Calderdale, Kirklees and seven other local council areas – is one of 39 LEPs that are partnerships of business and local authority leaders.

In October, Lord Heseltine – in a study requested by David Cameron – called for LEPs to control budgets worth £17.5bn-a-year.

Departments would be forced to hand over all funding streams that support growth, delivering annually hundreds of millions of pounds to LEPs that put in viable bids.

But Mr Cable said: “There is a genuine concern about local enterprise partnerships. Hardly any of them come up to me and say ‘we would like billions more money to spend’.

“That’s not the way they think, or operate. It’s a false premise. There is a capacity issue – they are quite small groups – and there’s an accountability issue.”

The criticism comes only weeks before Chancellor George Osborne is due to announce the size of the ‘spending pots’.

Mr Cable said he believed the Government would instead follow the route of expanding ‘City Deals’, groups of elected local authorities.