North East Devolution and Levelling Up

North East and Tees Valley: why the good news gap?

A follower of this website (thank you) makes the point that there is a stark contrast between the news flows from the North East Local Enterprise Partnership area (NELEP) and Tees Valley. It’s a good point and raises the question why that should be so and what, if anything, it signifies.

The comment was made specifically in relation to the report here this week on the latest monthly labour market statistics from the Office for National Statistics coupled with two announcements of projects bringing new jobs to Tees Valley, one by SeAH Wind to Teesworks and the other of civil service posts to Darlington.

These are only the latest examples, however, of what seems to have been a steady stream of good economic news out of Tees Valley for quite a long time compared with a more intermittent one from the NELEP area, though the latter has seen some very significant projects such as Briishvolt at Blyth and Envision at the International Advanced Manufacturing Park (IAMP) on the Sunderland/South Tyneside border.

The first point to make is that there is some statistical substance to the view that Tees Valley has been doing rather better than the NELEP area recently. Tees Valley’s employment rate has been consistently lower than NELEP’s for many years but the gap has closed recently from 3.1% to 0.8%. Between the year to September 2019 and the year to September 2021 the proportion of people in jobs in Tees Valley rose from 68.9% to 69.8% while the proportion in the North East fell from 72.0% to 70.6%.

There are still proportionately more people in work in the North East than in Tees Valley, but not by much. And before we get over-optimistic about Tees Valley’s performance, it is important to note that the past year (to September 2021) saw the employment rate fall in both areas; it’s just that the Tees Valley rate didn’t fall quite as fast as the NELEP rate. There is also the pandemic and its uncertain effects to consider.

The statistics tell us nothing, however, about how the economies of the two areas will compare in 2030, the deadline by which the government hopes the objectives set in the Levelling Up White Paper will be achieved. All we can do is make a judgement about which area is doing a better job of laying economic foundations for the future.

This bring us to a second point, more nebulous but probably more potent than the comparative statistics – the feel-good factor, or sense of optimism. There is reason for cautious optimism that both the North East and Tees Valley are indeed laying the building blocks for an economic recovery, particularly in the green energy sector, electric vehicles and their batteries, pharmaceuticals and life sciences and the digital and creative sector.

While, as discussed above, it will be several years before the beneficial effects of these developments are seen in terms of jobs, in Tees Valley they are being experienced already, in anticipation, in terms of what the White Paper calls pride of place. In fact, Tees Valley’s pride in place was given a boost as long ago as 2010 when One North East, the regional development agency, was abolished and Tees Valley was liberated from what it perceived as dominance by Newcastle.

More recently, there is one reason why this pride in place has been given a further lift, and it can be summed up in two words: Ben Houchen. The Mayor of Tees Valley is a superb publicist, both for Tees Valley and for himself. He proved it when he turned his narrowest of election victories in 2017 into a landslide re-election four years later.

How has he done this? When the mayor held a cabinet meeting on 24 January 2018 to ask his cabinet to approve the purchase of what was then Durham Tees Valley Airport, he hired a conference room at a Middlesbrough hotel to accommodate the crowd that he correctly anticipated would turn out for what would be a rare display of public interest in local governance. It was the most significant sign yet that he was arousing the enthusiasm of local people. This author was there to witness it.

Through a combination of political and public relations skills he had laid the groundwork that led to the unanimous approval of the airport purchase by the five council leaders who had all until then opposed it. Houchen has not looked back since.

Four years later he continues to milk the Tees Valley public’s pride in their airport for all the publicity it is worth, and is now doing the same with the Teesworks site, formerly home to Redcar steelworks and now being developed as a nationally significant home for the green energy sector.

Barely a day goes by when Houchen is not in the mainstream media. Often his photo opportunities are at either the airport or Teeswork, and often accompanied by a minister, including the Prime Minister.

This is not all. Houchen’s consistently upbeat references to Tees Valley and everything in it, as a place where all local businesses are incredible and all local people are brilliant, can sound shameless and ridiculous. But it works.

In Tees Valley all publicity goes through this super-optimistic mayor. No wonder the news coverage is positive.

The North East has no one like him. The Mayor of North of Tyne, Jamie Driscoll, does the best he can but has one hand tied behind his back. He is half a mayor, or rather the mayor of half a city region. The Tyne and Wear economy is split in two and Driscoll’s writ does not run south of the river. He puts himself about but does not receive anything like the level of publicity enjoyed by Houchen.

The North East seems to have no locations like Teesside International Airport or Teesworks to serve as backdrops to repeated ministerial visits and photo opportunities. If it does – at the IAMP or Britishvolt site for example – the North East’s leaders lack the PR nous to make the most of them. Tory Ministers, anyway, do not go out of their way to visit either a Labour mayor north of the Tyne or a Labour North East Combined Authority (NECA) to the south.

While Houchen’s relations with ministers involve mutual support and focus on the latest projects or grants coming to Tees Valley, those of the North East leaders focus negatively on victimhood and unfair funding. They might have a good case, but it’s not a good strategy.

The seven council leaders on NECA and the North of Tyne Combined Authority (NTCA) have been unable so far to overcome the division that split them in 2016 and find a single voice. Driscoll is talking up the prospects of a new North East devolution deal covering the six councils in Tyne & Wear and Northumberland in ChronicleLive again today, as he has been doing intermittently for at least a year. But we still don’t know whether the six council leaders will overcome their differences and reservations and agree.

Meanwhile, he leads the NTCA; the Sunderland Council leader, who few outside Sunderland have heard of, chairs NECA; and the Gateshead leader, who led the fight against the government’s devolution offer in 2016, chairs the only cross-river body of importance, the Joint Transport Committee. It’s a position he uses to raise false public hopes of an £804m bus improvement plan while facing the reality of swingeing cuts to existing routes. For both of them he wants the government to pay up.

When the seven council leaders do get together it is, in time-honoured North East fashion, in private at a shadowy group known as the LA7. The LA7 was established as an emergency response to the Covid pandemic, which is understandable. But now very possibly it is debating a new North East devolution deal. No one actually knows as it does not even publish agendas or minutes, and Driscoll’s occasional public statements give the only clues to what, if anything beyond the Covid emergency, it is discussing. As well as the North of Tyne Mayor, the Northumbria Police and Crime Commissioner is also a member of this informal body that seems to exert a lot of behind-the-scenes influence over North East local government – for no obvious reason than that she is a Labour politician.

Far from being a united voice for the North East, the LA7 is a body that hardly anyone has heard of. People should be told what is going on, not through occasional website statements but regular public meetings with agendas, reports and minutes.

The North East LEP, meanwhile, is a business-led technocracy, which also meets in private and has a low public profile even if high recognition in the business community, and its website is informative. The relevant comparison between the news flows coming out of the North East and Tees Valley is not actually between their LEPs but between their local politicians and the way they have responded to devolution over the past six years. England’s 38  LEPs in any case face an uncertain future, as the White Paper makes clear.

This mention of contrasting news flows brings us back to the starting point of this discussion. The news from Tees Valley is mainly positive because Tees Valley has already achieved two of the objectives set out in the Levelling Up White Paper  – pride in place and strengthened local leadership. 

That, it might be argued, is the easy bit – though strengthened leadership at least has proved too difficult so far for the North East’s council leaders. No wonder their divided and incoherent state does not yield positive news. 

The prospects for the third objective – a stronger economy – are being successfully talked up by Mayor Houchen, and there is reason for cautious optimism in both Tees Valley and the North East, based on the green industrial revolution and other sectors where the region is strong, as this website has argued before. But it will be a long process and 2030 is a realistic target date for achieving levelling up.

As to the White Paper’s fourth objective, improved public services, that will depend on economic growth, the reversal of more than a decade of austerity and the easing by the Treasury of departmental expenditure limits. There was no prospect of that in the White Paper and even Ben Houchen is not talking it up.