Whitehall officials have been accused of trying to delay £760m of North East investment in a bid to find ‘election ready only’ spending projects.
Businesses and council leaders have jointly submitted a plan for growth as the region looks for a share of the Government’s £10bn local growth fund.
But after months spent compiling a wish list of jobs projects, including new railway lines and regeneration sites, ministers have now tried to force local enterprise partnerships to pick just a few priority schemes.
Cities minister Greg Clark has been told he risks setting back long term economic growth, with the leader of Newcastle Council Nick Forbes among those suggesting the move looks like an attempt to find an election boost.
If the Government insists on only funding schemes which are almost ready to go it would hand itself a list of ‘shovel ready’ projects that prioritise ministerial photo opportunities, city leaders have said.
Mr Forbes was among those who challenged the Government over its cash policy at a meeting with Mr Clark.
He said: “I raised the concerns when I met with Greg Clark last week. The Government haven’t just set a virtually impossible timetable for bids to the Local Growth Fund, they’ve changed the goalposts several times.
“Asking us, at the last minute, to prioritise schemes that are ‘shovel ready’ implies they are more concerned with projects that can be announced in the run-up to the election rather than those in the longer term interest of the region.”
The North East local enterprise partnership has, The Journal understands, refused to go along with the Government request, saying that it is wrong of the Government to ask businesses to spend months putting together a list of projects only to then change the criteria and ask for a new list with no clear indication as to how projects will be judged.
The region’s strategic economic plan will for now remain unchanged. Under the partnership’s preferred option, the Government would put £70m into a North East pot and let the region get on with building roads and clearing space for new firms. It would add to other cash for a North East Development and Investment Fund, handing the region £245m over five years to major developments.
If successful, the partnership says the overall plan could pave the way for an 11% increase in employment by 2024, suggesting some 10,000 jobs a year could be created.
Some £23m of local transport improvements are requested, including addressing traffic issues on the A185 and A19, work on the Lindisfarne Roundabout in South Tyneside and a Central Station Metro refurbishment.
Another £25m is asked for to pay for projects such as improvements to the A1 Scotswood Bridgehead, more work on the A19 near the Silverlink junction in North Tyneside and new funds to clear the way for roadworks behind Newcastle’s Central Station.
From 2016 onwards another £125m of funding is requested to help pay for the likes of a reopened Ashington, Blyth and Tyne railway, a new relief road for Durham City Centre, a link road for Newcastle Airport and Gateshead Town Centre regeneration.