Late on Thursday afternoon, a press release landed on my desk from the Conservative Party claiming evidence that the Government had ruled out giving extra powers to its proposed regional assemblies. As it turned out, it was the kind of slightly hyperbolic claim typical of what comes out of party political press offices at election time. The question of whether the assemblies are given a bigger role in key economic levers such as transport and skills training is in fact still very much a live issue up and down the corridors of Whitehall. But had the Tory claims been true - or were they to turn out to be true once the Government publishes its draft Bill on the issue in July - it would be a serious matter indeed. For with November's referendum on the issue gradually drawing nearer, the assembly powers issue continues to lie at the heart of the whole regional governance debate. With half of the North-East's "Year of Destiny" nearly gone, now is perhaps an appropriate time to analyse the state of the debate so far. Business leader Hugh Morgan Williams, writing in this newspaper last week, characterised it as "sterile," and while I disagree with his overall conclusion on the issue, I know what he means. Whilst voters in the region appear on balance to be mildly more disposed to regional government than not, none but the most ardent home rule enthusiasts could claim that the issue has thus far set the public alight. It would be unfair to lay too much of the responsibility for this at the door of the yes campaign, yes4thenortheast, and its chairman John Tomaney. It has, at the very least, succeeded in making the region's social and economic performance the key issue at stake in the assembly debate, pointing out that the status quo is not an option for tackling regional disparities. In so doing, it has been quite unfairly accused of "talking down the region", an accusation that has also been levelled by certain politicians at me in the past. Well, if seeking to highlight the injustices perpetrated by Government under-funding and neglect amounts to talking down the region, all I can do is plead guilty. But while the yes campaign has accurately diagnosed the nature of the region's problems, it has been less successful to date in explaining why elected regional government is part of the solution. The reason for that is quite simple: that the powers currently on offer to the proposed assembly would not offer much in the way of a solution to regional economic disparities. In this sense, the Government is expecting Mr Tomaney and yes4thenortheast to fight this campaign with their hands tied behind their back. It is allowing the no campaign, led by Neil Herron, a free hand in portraying the assembly currently on offer as that deadly political animal, a "talking shop". Now this is to some extent a parody of the current proposals which would for example devolve important powers in the fields of culture, the environment and public health. But by and large, these are not the sort of powers capable of generating the emotional response among the wider public that the yes campaign needs in order to build momentum. Our recent Journal poll was instructive in this respect, showing that while 68pc of people wanted the assembly to have powers over transport, only 55pc wanted it to have responsibility for arts and culture. The point being, of course, that while arts and culture are currently included in the list of assembly functions, transport is not. What the assembly needs - and there now seems to be wide agreement on this point between business and political leaders in the region - is what might be termed "the power to make a difference." To his credit, Deputy Prime Minister John Prescott knows this, and has dropped several hints about transport, skills training and police services ultimately coming under the assembly's control. But the main battle over the assembly powers issue is still to be fought, and it is not the battle between John Tomaney and Neil Herron. It is the battle over the contents of the forthcoming draft Bill between Mr Prescott and Prime Minister Tony Blair. Mr Prescott has this week been portrayed by North CBI boss Steve Rankin as fighting a lonely crusade for regional rule among Labour's senior ranks. Again, I am not sure that is fair, given that such eminent Blairites as Alan Milburn and Peter Mandelson are strong supporters of the idea. But where Mr Rankin has a point is that the Prime Minister himself continues to avoid saying anything about this issue that can remotely be interpreted as enthusiasm. And it is that very ambivalence towards regional devolution on the part of his Government that now most threatens a successful outcome to the referendum campaign. The lesson of our recent poll is that if Mr Blair is prepared to give an elected assembly real power, it would immeasurably strengthen the likelihood of a "yes" vote. If in the face of such evidence the Prime Minister were now to ignore such demands, we will be entitled to ask whether he really wants to see a yes vote at all. | 
