THE mad cuts, cuts, cuts agenda of the new government – abandoning vital spending, to ward off a devastating double-dip recession – is far from the only economic earthquake in town.

Just as important in the long run will be the death of Lord Mandelson’s much-vaunted “industrial activism” to revive the North, killed off by the free-market faith of the coalition partners.

In the 18 months after the economic crash, Lord Mandelson turned Labour policy on its head – insisting it was, after all, the Government’s role to offer loans and grants to companies seen as vital for future growth. Here in Merseyside, there was the £270m lifeline thrown to Vauxhall’s Ellesmere Port plant – to help develop “greener” cars – now under review, of course.

What is now clear is that, even if the Vauxhall loan is given the green light, there will not be any more like it under Lib-Dem Business Secretary Vince Cable, Lord Mandelson’s successor.

In his first speech, Mr Cable attacked the idea of writing cheques to favourite British businesses and trying to buck the market by picking “national champions”, pledging to support “capabilities, not companies”.

What will send shivers down Northern spines is if the speech signalled a return to Gordon Brown’s hands-off approach in his first decade – the one that let the City of London boom and manufacturing wither.

It appears Labour finally woke up to how other countries successfully stimulate hi-tech firms – using subsidies and targeted investment – only for that all to come to a juddering halt.

If Mr Cable and the rest of the Government are to escape that criticism, then they need to act fast to fill what appears to be a void where an industrial policy should be.

Ministers have set a helter-skelter pace in scrapping, or neutering, the regional development agencies, with no sign of fresh ideas to attract investment and jobs.

Just 3% of bank lending goes to manufacturing – three-quarters is handed to the finance sector and mortgages – but Mr Cable lost control of banking reform to the cautious Treasury. Since the election, we have heard nothing of Lib-Dem plans for “regional stock exchanges”, to provide finance to entrepreneurs given the cold shoulder by the London megabanks.

Come on, Vince – show us it’s not all cuts, cuts, cuts!

IT COST £80m to refurbish the art deco London offices of the National Audit Office, we learned last week – just £6m less than the Government is now refusing to stump up for the vital Second Mersey Crossing.

This observation could be the start of a long-running series on crazy spending decisions!