North East Devolution and Levelling Up

Devolution decision day approaches

Leaders of the three metropolitan councils south of the Tyne, which after more than five years of dithering still have no devolution deal, must start tomorrow to face up to the choice they must make – to reach an agreement with the government or remain left behind as other parts of the country move forward.

At stake is an immediate grant of between £600m and £650m for transport improvements, an annual investment fund of probably around £30m a year for 30 years and a larger share of other grants including the £4.8bn Levelling Up Fund and £2.6bn UK Shared Prosperity Fund.

The North East Combined Authority (NECA) will meet at South Shields Town Hall tomorrow to discuss a detailed report (pp 7-24) on the government’s Levelling Up White Paper (pp 233-235) published on February 2.

The White Paper states that: ‘By 2030, every part of England that wants one will have a devolution deal with powers at or approaching the highest level of devolution and a simplified, long-term funding settlement’.  

And in a specific reference to the North East, it adds that this means an expanded deal for the region, creating a new mayoral combined authority (MCA) of six. This would reunite the three North of Tyne Councils of Northumberland, North Tyneside and Newcastle, which already have a deal, with the three south-of-the-river councils of Gateshead, South Tyneside and Sunderland, which rejected a deal in 2016.

Durham, which also rejected a deal in 2016, has accepted a government invitation to negotiate a go-it-alone county deal, though at present it remains a member of NECA alongside the other 2016 refusniks.

The only NECA reaction to the White Paper so far has come from its chair, Councillor Graeme Miller, leader of Sunderland Council, who said at its last meeting on February 1 – the day before the White Paper was published – that: ‘We must be prepared to secure any opportunities arising from the devolution (sic) paper; securing proper, meaningful investment for NECA and its authorities’.

Leaders of the North of Tyne Combined Authority (NTCA), led by Mayor Jamie Driscoll and now by Newcastle City Council’s departing leader, Councillor Nick Forbes, have been urging their colleagues south of the river to join them in a new six-council deal.

NECA will tomorrow consider a purely factual report from officials detailing what a devolution deal would mean but making no recommendations.

The White Paper, it points out, reiterated the message of the [Autumn 2021] Spending Review that the North East is eligible for a City Region Sustainable Transport Settlement which could be valued between £600-£650m, subject to the appropriate governance arrangements to agree and deliver funding – i.e. a devolution deal and MCA for the North East Six.

There is also a hint that MCAs will fare better when the £2.6bn UK Shared Prosperity Fund, which is replacing EU regional funds, starts paying out in April: ‘In England, the Fund will primarily operate over the strategic geographies of the MCAs and the Greater London Authority, and lower tier or unitary authorities elsewhere’ says the report.

COMMENT

NECA is unlikely to make a decision on devolution tomorrow, and even when it does there will be consultations to take place with both the individual councils and the public. The last time NECA – then with seven members – considered devolution it went so far as to sign a provisional deal in October 2015, but then spent 11 months wrangling over it before voting 4-3 to reject it and splitting along the line of the Tyne.

The ultimate decision will be made in the privacy of the Labour groups that currently control Gateshead, South Tyneside and Sunderland councils. In 2016 these councils rejected devolution in spite of public consultations that resulted in positive overall support for the deal, as demonstrated by this author in his 2020 thesis. It will be interesting to see if devolution is an important issue in the council elections May 5.

After tomorrow, NECA is not due to meet again until June 7, and that date is still to be confirmed.