John Prescott had encouraging words for the two cities

But John Prescott has warned they are still lagging behind Europe's best, and need to improve their performance for the sake of their region and the whole country.

Speaking at the fifth Core Cities group meeting, Mr Prescott said the reputation of Leeds as the powerhouse for the Yorkshire economy was long-established.

And he added: "It's progress in the last six years has been remarkable even by its own standards."

"But like all core cities, there is still more progress to be made.

"Leeds' productivity is below the European average. This doesn't just affect Leeds, but the whole of West Yorkshire.

"Cities like Leeds need to grow even stronger if we are to redress the economic imbalance in this country."

Focusing attention on South Yorkshire Mr Prescott picked out Sheffield for particular praise.

The challenge is to put down the sort of economic roots that will guarantee prosperity for future generations to come Deputy Prime minister John Prescott

He said: "The progress made by Sheffield over the last six years has been astonishing.

"It's hard to believe this was part of our country once written off as failing."

"The success of Sheffield is central to the success of the whole of South Yorkshire.

But he added: "Sheffield has a way to go to match the best in Europe. But I am optimistic that it is heading in the right direction, which is not only good for the city, but the whole region."

He said the cities had come a long way and now had a new found confidence and vibrancy.

"What was once industrial wasteland is now smart homes, cutting edge cultural centres or shops and offices.

"The challenge is to put down the sort of economic roots that will guarantee prosperity for future generations to come."

Mr Prescott was at the Core cities meeting in Newcastle to launch a report into the economic performance of the regions, called "Cities, Regions and Competitiveness."