The business organisations, which represent more than 250,000 businesses between them, are concerned that through awarding one organisation sole responsibility, that wider business interests and concerns will not be taken into account.

Even more worrying for the organisations is that the Government department responsible for LEPs has done this without putting the opportunity out to consultation or to tender.

John Walker, National Chairman, Federation of Small Businesses, said:

"We are entirely supportive of the concept of a group which brings together Local Enterprise Partnerships (LEPs).  However, there is more than one business organisation on the ground, each representing different business sectors and with members working hard to make the LEPs a success by dedicating their time to develop them from grassroots level – something the Government wanted.

"For LEPs to be truly effective they need to represent those diverse business interests.  By simply picking a single business organisation to run it in this way, with no consultation with the rest of the business community, risks isolating both those businesses which are not a member of any membership body and those who are members of the groups that haven't been included from LEPs."

Miles Templeman, Institute of Directors, Director-General, said:

"We are surprised and disappointed that the Government has appointed the British Chambers of Commerce to head this £300,000 quango with no consultation or discussion with other business groups. We question seriously the need to spend £300,000 of taxpayers' money on a body whose purpose is to lobby national government on behalf of LEPs. No case has been made to us for this arrangement."

Phil Orford, Chief Executive, Forum of Private Business, said:

"Many of our members still don't understand what Local Enterprise Partnerships will do to support economic and employment growth at a local level. To now discover that Government has been holding unilateral discussions with one business organisation to provide a national networking and coordination body for LEPs, without competitive tender is frankly surprising and disappointing and will raise questions about the localism agenda and public procurement policy."