Linda Arkley, Conservative leader on North Tyneside Council, believes that in the current economic climate, large sections of the Spanish City should not be sold off for housing or a hotel.

Traders and some members of the community are concerned about the future of the area, in particular the Dome, under the current plans.

Speaking at a Whitley Bay Chamber of Trade meeting on Tuesday, Mrs Arkley said the current proposals for the Dome, a nearby hotel and housing on Bournemouth Gardens should be scrapped and re-started, aimed at giving the town what it wants.

The Conservative candidate in next June's Mayoral election said that if she was to win, she would set about re-starting the Whitley Bay Regeneration Sub-committee and listening to what people wanted for the area.

And Mrs Arkley also revealed that she was keen to hear more from community group Culture Quarter about their plans for the Dome and had set up a meeting with them.

She said: "I feel that the present Mayor has turned his back on Whitley Bay, especially when he's put the Dome out again on the market.

"This is the jewel in our crown and it seems he's washed his hands of the whole business and walked off.

"Whitley Bay needs regenerating as soon as possible."

Mrs Arkley added: "I think the whole site has to be revisited.

"It's extremely important that we get together again and we need to be looking at what innovative things could be done there, and not just housing or a hotel.

"After three-and-a-half years, to see the Dome now is depressing.

"There is people locally who could do quite well running it.

"I think we need to be listening to people.

"Traders give us the business, not the council.

"We'll work alongside you. Tourism is the greatest asset at the coast but that's been forgotten."

Traders said they would do everything they could to stop the current plans for the Dome, including writing to the Mayor and starting a petition in the shops.

Afterwards, a council spokesman said: "The transformation of the Dome and surrounding land is a key part of not only Whitley Bay's £64m regeneration but the wider coastal area.

"It is more than a unique opportunity for a spectacular seafront development, it's an opportunity to contribute to a 'string of pearls' approach along the entire North Tyneside coastline that is building on both its natural and existing attractions.

"Developers are being challenged to create an innovative scheme that will raise the bar for Whitley Bay, both in terms of design and quality.

"We want it to contribute to a destination where people will want to live and visit as well as increase footfall from the town centre to the seafront and provide a year-round attraction that will enliven the seafront.

"We're continuing to work with Tourism Tyne and Wear and One NorthEast to proactively market North Tyneside and in particular our coastal resorts.

"We've also set up a Coastal Zone Board and a Retail Centres Board to co-ordinate and drive regeneration within the borough, which will directly benefit Whitley Bay.

"Engagement with businesses in the town is, and will continue to be, a feature of this work."