November 12, 2009 9:15 AM

A furious row has erupted between the Lib Dems and Labour in Newcastle.

A Labour leaflet being distruibuted in Fenham accuses the Lib Dems of only buying the Northern Rock Tower because "we can't have empty buildings in Gosforth!"

But last month Business Secretary Lord Mandelson praised the partnership that has seen the Tower re-open after being mothballed.

Lib Dem Ron Beadle, who is challenging Labour in Newcastle North at the forthcoming General Election, said: "It appears the Labour Party in Newcastle is at odds with its own Government.

"Only last month Lord Mandelson officially opened the building and praised the partnership that is creating jobs for local people.

"However, Newcastle Labour have ignored that an instead resorted to cheap point scoring.

"What Labour is doing in Fenham is the worst kind of class politics.

"Labour is trying to build resentment in Fenham towards people who live in Gosforth.

"It shows how desperate they are. People living in Gosforth will be rightly angry and disappointed when they hear about this."

The Northern Rock Tower, which has been re-named Partnership House, was officially opened by the Business Secretary.

The building was bought from Northern Rock by the city council, who have leased part of it to energy firm eaga as their new HQ.

They have now formed The Real Partnership to work together to exploit opportunities in the public sector.

Unveiling a plaque to mark the occasion, Lord Mandelson told staff: "I think you are all doing a magnificent job.

"I love what you're doing and I love where you're going. It's a win, win, win.

"It's a private enterprise solution to public service needs. We cannot do everything in the public sector and nor should we try.

"That's exactly what I want to see in the economy... new business, new jobs, public need met."

Bill Shepherd, the Lib Dem-run council's regeneration chief, said: "The Labour Government sacked 600 people from Northern Rock when they nationalised it, these people live all over Newcastle.

"The Tower, saved from mothballing, is the new home to businesses from across the region.

"This is creating real new jobs. Apparently Labour would rather have it lie empty because it happens to be in Gosforth."