NORTH East council leaders have dropped two years of infighting to form a legally binding combined authority bidding for millions of pounds in Government cash.
In a move which will repeat in some respects the days of the Tyne and Wear County Council, leaders of local authorities from Northumberland down to Durham have agreed to pool their resources on transport, regeneration and skills training.
Last night Lord Adonis, the former transport secretary carrying out a review of the North East economy for Nick Clegg, called on the Government to urgently pass the legislation required to give the combined authority a statutory basis.
The move will put the seven councils on the same footing as the likes of Greater Manchester which already has a Government-backed combined authority able to take control of large areas of Whitehall funding.
It is understand that in recent months Treasury minister Greg Clark has “read the riot act” to North East councils setting out that they will not be able to bid for devolved finances, and the potential to create extra jobs, unless they are seen to be working together.
The decision comes amid speculation large parts of Lord Heseltine’s review on boosting regional economic growth by devolving Government cash will be backed in the Chancellor’s Budget next week.
Last night’s announcement will be seen by some as a victory for South Tyneside council leader Iain Malcolm, who has been the most public of the seven council leaders in his support for a new council structure in the region.
Gateshead Council leader Mick Henry said the changes will not mean a new council for residents.
“We will still be the people collecting the bins,” he said. “But what this means is we legally come together.
“Because we have to make sure we are at the table and being considered for what looks set to be a new way of deciding how Government money is spent. “
Lord Adonis told The Journal he strongly welcomed the move. He said: “This is a highly constructive step by the leaders of the local authority. This will provide a real boost to economic development. It is essential the Government now responds in kind and devolves serious funding and responsibility.
“In particular that needs to include skills funding to tackle the big problem of youth unemployment in the region.”
Cities minister Greg Clark also backed the move.
He said: “The Government will very soon respond to Lord Heseltine’s report which builds on the successful Newcastle City Deal. It is encouraging to see the momentum being shown in the North East.”
Business have also supported the initial move. Sarah Green, director of CBI North East, called for the creation of a combined authority in the CBI submission to Lord Adonis’s commission.
She said: “Businesses believe that it is critical for local authorities to work more closely together, particularly in those policy areas which are so important to economic development.
“We would urge them to go further in due course and explore the possibility of working together in other areas critical to delivering the growth we need.”
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