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Regional development agencies must continue to keep a business focus, warns a report published today.
The Commons Business and Enterprise Committee gave its "broad support" for a public body operating between national and local economic development issues.
But if RDAs are to fill this gap, the report warns, they must continue to be "business-led".
The statement came as the MPs published their analysis on RDAs and the government's Local Democracy, Economic Development and Construction Bill.
And the MPs recommend that the government must respect the democratic interests of the local communities when making the changes in the Bill.
The committee also expressed its "surprise" that the government introduced the Bill in the Lords before publishing an independent review of the RDAs by accountancy firm PricewaterhouseCoopers.
The report proposed that local authorities should have responsibility for economic assessments of their areas.
And councils rather than RDAs should control devolved funding for local financial policy.
Committee chairman Peter Luff said: "In particular we are concerned about the tendency of governments to add responsibilities to RDAs that may distract them from their core tasks and then to cut, or 'dip into', their budgets to address other short-term funding difficulties.
"The inquiry found widespread support for a regional level of government for economic development purposes although we do have concerns about the structure, work and responsibilities of regional development agencies."
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