One of the main political themes of recent years has been devolution, which constitutes a core element of the Levelling Up agenda. Different parts of the country have benefited from deals under which funds and powers have been transferred from Westminster into local control. It's a popular policy with cross-party support.
In December 2022, the Levelling Up Secretary Michael Gove announced a devolution deal for North East that will see a new elected mayor given £4.2 billion to invest in new initiatives alongside additional powers to address skills, transport and housing. This has been celebrated as the biggest devolution deal that the UK has seen (so far).
The order put before Parliament on 7 February 2024 put the devolution deal into effect by creating a new Combined Authority called the North East Combined Authority ("NECA") and a "Metro Mayor" representing the people of Northumberland, Newcastle, North Tyneside, Gateshead, South Tyneside, Sunderland, and County Durham, however it was always subject to approval by Parliament
On 21 March 2024 it was announced that Parliament has approved the order. The name of the new organisation is surprising given that there is currently a North East Combined Authority. The new NECA will be a separate and distinct organisation, but will take on the functions of this organisation as well as those of the North of Tyne Combined Authority, the North East Local Enterprise Partnership, Transport North East and Invest North East England. Therefore whilst the name is the same, the potential for the new organisation is much greater.
A new "Metro Mayor" for the North East of England
The election for the new North East Metro Mayor will take place on the 2nd May 2024 (the same day local elections are due to be held in many parts of the UK).
The candidates who have announced they plan to stand are:
- sitting independent North of Tyne mayor Jamie Driscoll
- Labour’s Kim McGuinness
- Conservative Guy Renner-Thompson
- Liberal Democrat Aidan King
- the Green Party’s Andrew Gray
- Reform UK’s Paul Donaghy
What funds and powers will NECA have?
Powers that NECA will hold include:
- the ability to develop local transport plans;
- create new bus franchising powers;
- the ability to pay grants to bus service operators;
- the ability to pay grants to the Constituent Councils for exercising transport functions;
- powers to designate 'Mayoral Development Areas';
- powers to establish mayoral development corporations to aid in local regeneration
- housing and land acquisition powers (including compulsory purchase) to support housing, regeneration, infrastructure and community development and wellbeing;
- powers to draw up a 'Spatial Development Strategy' (subject to final agreement);
- powers to set a precept on council tax; and
- powers to charge a business rate supplement (subject to ballot).
These powers will be complemented by significant additional public funding. Over 30 years an additional £4.2bn is expected from Central Government, with NECA having control of up to £563 million to shape and improve local rail and bus services as well as a new £1.4bn investment fund. This will be distributed alongside programme funding such as £17.4 million to support and accelerate the building of new homes on brownfield land, as well as £20 million to level up and kick start regeneration.
Conclusion
There is genuine excitement within the North East about the opportunities which the North East Combined Authority presents. A powerful Metro Mayor backed by significant funding and meaningful powers offers hope that solutions can be found for many of issues affecting the region including areas which suffer from high levels of deprivation and economic underperformance.
In other regions, we have seen the creation of Mayoral Combined Authorities result in further funds and powers being devolved as the confidence of Westminster is earned and there is no reason to believe that a different approach will be taken in the North East.
DWF is the largest legal services business with an office in Newcastle. It provides legal services to many of the major public authorities in the region, including the North East Combined Authority and Newcastle City Council, as well as major employers in the region. Lawyers from DWF's Newcastle office are ranked in the Chambers Directory, Legal 500 and Who's Who Legal. DWF can provide you with advice if you are planning to deliver a project using public funding on how to comply with the relevant law, including Subsidy Control and Public Procurement.
