The future of a multi-billion pound devolution deal for the North East remains unclear – despite Jeremy Hunt promising it will be announced soon.
The Chancellor pledged during his autumn statement on Thursday that a new package of powers and funding that would see a new mayor elected for the region in 2024 should be confirmed “shortly”, in a major shakeup of North East politics that would reunite councils on either side of the Tyne. But Mr Hunt could only say that the long-awaited deal will cover “an area in the North East”, with local disagreements meaning that doubt persists over whether County Durham will be allowed to join six northern neighbours in the pact.
A draft deal covering Newcastle, Gateshead, Northumberland, North Tyneside, South Tyneside, and Sunderland has been close to being agreed since the final days of the Boris Johnson government. It would be worth more than £3bn in Government funding over 30 years, would include a £35m per year investment fund and £900m in transport funding up to 2027, plus crucial decision-making powers such as the ability to bring bus services back into public control.
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But the Tory-Lib Dem coalition administration at Durham County Council announced last month that it wanted to join the deal too, instead of going its own way with a single-county devolution arrangement – something it had been pursuing before and which Durham’s Labour MPs and councillors are now vociferously calling for. That move, coinciding with chaos in Westminster that led to Rishi Sunak replacing Liz Truss in Downing Street, has led to fresh uncertainty over if and when the deal will be done.
The idea of letting Durham in is known to have split the leaders of the other six councils and further delayed the project, sparking memories of the local political wrangling that caused a previous devolution deal for the North East to dramatically fall apart in 2016. The Local Democracy Reporting Service understands that council leaders met with levelling up secretary Michael Gove on Monday, but there is still no consensus on Durham’s involvement.
Labour’s North of Tyne mayor, Jamie Driscoll, said the deal would deliver billions in much-needed investment and “greater control over things that matter to people here”. He added: “We just need to iron out the political problems and get this signed on the dotted line.”
In a statement on Thursday, the six councils involved in the initial devolution talks said they were still in talks “to see if a deal can be reached that unlocks the true potential of our region”.
They added: “A new devolution deal that will make a difference to all our communities has been discussed by local leaders and Government for some time now. We are seeking an ambitious deal that enables each local authority and the combined authority to get the benefits they want for their communities, residents and businesses.”
Coun Amanda Hopgood, the Lib Dem leader of Durham County Council, said: “We continue to work hard to seek the best possible devolution deal. Discussions are ongoing regarding County Durham joining the six other local authorities in the North Rast to create region-wide devolution arrangements and we hope to provide an update soon.”
The North East was tantalisingly close to a region-wide devolution deal covering the seven council areas in 2016, before a split among the Labour-dominated local authorities caused that to fall apart. Newcastle, North Tyneside, and Northumberland subsequently broke away to form their own North of Tyne Combined Authority (NTCA), for which Mr Driscoll was elected mayor in 2019.
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