MPS have given the go-ahead to a new North East super council despite worries it will not do enough to create jobs.
The North East Combined Authority has secured the reluctant backing of the region’s Labour MPs, as well as Government support, and is now ready to act as what its creators say will be a new voice for the region.
The combined authority will be tasked with bringing together the work of seven councils of Northumberland, Tyne and Wear and County Durham on issues around job creation and transport, though there are no changes to local councils.
Gateshead MP Ian Mearns told a legislation committee agreeing the final go ahead: “This is far from perfect, but it is the only game in town, so it has my support.
“If we were to take a step back it could be some time before we get to this stage again.”
Former regional minister Nick Brown repeated concerns that the new body would be a talking shop.
He said: “Overelaborate structures are not what the region needs. We need something that is slimmed down and sharply focused on the job that we can all get behind. My fear is that we have something that compares to other bodies delivers less and costs more.”
Hexham Tory Guy Opperman backed the new body, telling MPs that it would end situations such as the behind-the-scenes battle to host the UK’s Green investment Bank.
In 2012 the region submitted four different bids, and it is thought that infighting led to the failure of all of them.
Mr Opperman said: “Central Government would look open-mouthed that an area of 2.5m people submitted four different bids rather than coming together. We will be massively improved as a region by not fighting like ferrets in a sack any more.”
Berwick MP Sir Alan Beith, the only Liberal Democrat to represent a constituency in the new authority’s area, said there were some worries that rural areas would lose out, adding: “Despite reservations I do support this because it is about jobs. It gives the North East some of what London has, a smaller degree of devolved power.”
Seven councils leaders from across the region will now set about creating an entirely new structure with the power to borrow funds to invest, taking legal responsibility for major new developments.
Local Government minister Brandon Lewis said combined authorities were the best way for the Government to eventually hand over control of large slices of Whitehall funding, such as providing governance for the Local Growth Fund.
Miliband's £20bn pledge
A new North East super council will be eligible to bid for a share of £20bn for transport improvement, new housing and training schemes, Labour leader Ed Miliband is to announce today.
He will set out plans for Labour to strip national government of billions of pounds and send the cash directly to the regions of England for local politicians to spend. But he will also warn that funding will go to “city regions” and “county regions” where authorities are working closely together and have strong leadership.
This means combined authorities, which bring together councils to make joint decisions on major issues.
Mr Miliband will pledge: “Cities and towns that agree to come together with local businesses to plan for their economic future will be given historic new powers over funding for infrastructure, skills and economic development. They will be able to invest directly in transport and housing, as well as having greater say over skills, with local businesses for the first time controlling the funding of apprenticeships.”
Local Enterprise Partnerships (LEPs), bodies set up by the Government but led by the local business community, will also play a role. A Labour Government will demand that each combined authority has just one LEP.
The proposals are based largely on a study by former Conservative PM, Michael Heseltine. George Osborne, the Chancellor, announced in 2013 he was accepting the recommendations, but Ministers have provided just £2bn in funding for 2015-16. Mr Miliband will announce Labour is promising £20bn over the course of the next Parliament, and he is writing to councils, LEPs and universities asking them to begin drawing up plans for how the money can be spent.