Secretary of state Michael Gove agreed the 'minded to' deal with regional leaders

Devolution deal nears as councils prepare sign-off

Cabinet-level approval is being sought over the next week as North East local authorities seek to bring about a £4.2bn devolution deal.

Sunderland City Council’s cabinet meeting on 2 June should be the last in a week-long string of meetings where approval is being sought for officials to submit a report to the Secretary of State on the devolution consultation, which ran until late March.

The local authorities involved – Northumberland, Newcastle, North Tyneside, Gateshead, South Tyneside, Sunderland, and County Durham – signed a “minded to” deal with government earlier this year to work towards becoming united as a mayoral combined authority.

This new North East mayoral combined authority, known as NEMCA, will replace the existing North of Tyne MCA and its mayor, as well as the non-mayoral North East Combined Authority, bringing the region together to provide a more strategic economic geography covering the whole Tyne and Wear region along with Northumberland and Durham.

The situation would be similar to the Tees Valley’s combined authority, which  covers five local authority areas; or Greater Manchester’s, which includes ten boroughs.

On signing the January deal, secretary of state Michael Gove described the deal as “bigger, bolder and better” than previous attempts to bring together the regional authorities. The headlines at the signing were of a £1.4bn investment fund over 30 years.

Re-cap: the devolution deal on the table

  • Investment fund of £1.4bn, or £48m a year over 30 years, to support inclusive economic growth and support our regeneration priorities
  • Indicative budget of around £1.8bn, or £60m a year, for adult education and skills – to meet local skills priorities and improve opportunities for residents
  • £900m package of investment to transform transport system, with £563m from the City Regional Sustainable Transport Fund, on top of funding already announced for the region’s buses and metro system
  • £69m of investment in housing and regeneration, unlocking sites to bring forward new housing and commercial development

The consultation

According to the report, 3,235 people or organisations responded to the consultation process. Respondents were asked about how they viewed transferring authority in five key areas to a devolved authority: governance, transport, housing & planning, finance & investment, and skills/employment & adult education.

While a majority agreed that a devolved authority would be able to improve matters in these areas – most tellingly in transport, where two-thirds were in favour of greater local control – concerns were raised elsewhere in the survey.

Issues raised included a lack of trust in politicians at local as well as national level, that the change would merely introduce additional bureaucracy, and that rural areas and places like County Durham could be marginalised in the new set-up.

Durham was the most heavily represented location in the survey, while older age groups were better represented than young.

Largely, the organisations consulted are in favour, including the CBI’s North East regional council, Advance Northumberland, Bionow, the FSB, IoD, Nissan, and the North East Business Innovation Centre and Chamber of Commerce.

A statement from the seven councils said: “The findings paint a clear picture of a united North East that wants to see us work together to drive our region forward and unlock further opportunities in the future.

“We are confident that the changes will have economic, social and wellbeing impact by creating more good jobs and homes as well as creating a better-connected region.

“This consultation has provided us with a significant amount of positive feedback, as well as lots of important considerations to take on board, to ensure the North East Mayoral Combined Authority delivers for the near two million people who call our region their home.

“We would like to thank everyone who took part for helping us to progress with this historic opportunity that has the potential to transform our region for the better.”

What happens next?

Should parliamentary approval be given, the desired timeline is for a North East mayor to be elected in May 2024.  For that to happen, the secretary of state must be satisfied that the consultation has been sufficient, with statutory criteria met.

Once that is established, the secretary can then request a parliamentary order to abolish the existing combined authorities and establish NEMCA.

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