CITY leaders have met with Cabinet ministers to discuss Government help to create a Newcastle to New York transatlantic route which would help bring £1bn to the regional economy.
A senior delegation from Newcastle City Council made the case for regular flights as part of its pitch to be one of a handful of cities handed a raft of new powers in the Chancellor’s March Budget.
Council leader Nick Forbes and his chief executive Barry Rowland set out their plans at the Cabinet Office yesterday before Communities Secretary Eric Pickles, Business Secretary Vince Cable and Cities Minister Greg Clark. Mr Forbes is also looking for new borrowing powers which will allow him to spend tens of millions of pounds transforming Newcastle, with the money repaid through the business rates of those moving into new shopping centres and office blocks.
City leaders want Government help to get around strict state aid rules which prevent financial help being offered to private firms.
It is thought the city has come close on several previous occasions to securing government support, but never yet clinched a deal. If they are successful it could be worth around £1 bn to the regional economy.
Ministers were told they may need to look at limited regional-specific tax breaks for those offering to set up the air route.
The Journal has campaigned for reform of the Government’s Air Passenger Duty , which sees taxes passed to flyers.
Ministers have been warned the tax is holding back growth in regional airports.
Mr Forbes, who acknowledged a successful bid to government would have major implications for the regional economy, also asked for help to incentivise the North East’s stalled renewable energy industry. Tyneside has previously complained it is unable to offer the same help which Scotland can to attract big-name firms.
Both an American link and this inward investment help would, Mr Forbes argued, hand Tyneside the chance to compete on a level playing field with Scotland. Mr Forbes said: “My priority is to help transform the economy of Newcastle.
“This is not just about leading it out of recession but looking into the future to the next generation of jobs and how we can train people to do them.
“I think the ministers were extremely interested in our proposals.”
He was backed at the meeting by Paul Woolston, chairman of the North East local enterprise partnership of business and council leaders.
Mr Woolston said: “We were asked some very probing questions but I felt that overall the ministers were very interested in the proposals put forward by Newcastle and Gateshead.”
The Government is considering the city’s submission. A spokesman said: “Government is discussing city deals with all of the core cities. As part of this, Newcastle has put a series of proposals to Government, which ministers are considering.”