The £4.2 billion devolution deal uniting the North East

Following extensive negotiations with the secretary of state for levelling up, housing and communities, the Government announced in December a new devolution deal for the areas of County Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside, and Sunderland, replacing the North of Tyne devolution deal made in 2018.

This deal would see significant powers transferred to the North East from central government and offers a potential £4.2bn investment into the region:

• An investment fund of £1.4bn, £48m a year, to support economic growth and regeneration projects
• A budget of around £1.8bn, £60m a year, for adult education and skills – to meet local skill priorities and improve opportunities for residents
• £900m for investment in transport systems, with £563m from the City Regional Sustainable Transport Fund, on top of funding already announced for buses and the metro system
• £69m of investment in housing and regeneration, to bring forward new housing and commercial development
•  24,000 extra jobs and 70,000 courses per year to give people the skills to become employed, and leverage £5 billion of private sector investment

This deal comes with the next mayoral election in 2024 where North of Tyne Combined Authority (NATC) and North East Combined Authority (NECA) would combine into one new council, an area which would encompass around 2 million people.

Cabinets of seven local authorities agreed to the terms of the devolution deal and the next stage of the plans, which includes public consultation; residents, businesses, and other stakeholders can give their feedback online or by attending a number of face-to-face or virtual events taking place across the North East. At the end of the consultation period, which ends on the 23^rd of March, a report will be brought back to each Cabinet with a summary of the responses. Any proposed submissions by the Councils will be sent to the Secretary of State to consider before laying an order in parliament.

The phrase ‘Wider and deeper’ has been used repeatedly around this deal. ‘Wider’ is certainly true as the new authority would be some 3000 square miles bigger than previously thought with the addition of South Tyneside, Gateshead, Sunderland, and County Durham. While ‘Deeper’ is used to refer to the greater powers this new council would receive in housing, skills, and transport. Transport will be a big focus of this new council as it gains control of the Tyne and Wear metro, subsidised buses, and Shields ferry.

As we learn about the process of devolution in England, it seems that deals like these are a foundation to build up from, Mayors regularly negotiate for further funding, like in the case of Greater Manchester where the combined authority spent almost double the amount set out in its initial deal after further negotiations. It seems that this deal is a starting point for the new, combined northeast and, if nothing else, as the deal is discussed and debated, many councillors have noted that they’ve “never known the North East as united as this” and that if we keep discussions open and stay united, the North East is in a ‘prime position’ for the future.