What is devolution?
Devolution is the transfer of powers and funding from central Government to a local area. It allows decisions about things like investment, housing and skills development to be made locally to better meet the needs of our economy, businesses and residents.
Why do we need a devolution deal?
The area has huge potential and a successful track record of creating jobs and nurturing world-leading businesses. But, we also have many challenges. The devolution deal will allow us to focus investment on our local needs and create new opportunities.
Other areas of the UK, like Liverpool, Greater Manchester, Tees Valley and Birmingham, already have devolution deals that give them additional powers and funding. It’s vital that the North of Tyne is not left behind and that we have all the economic tools at our disposal to be competitive in the future. Without a similar deal, we would struggle to compete and could lose out when it comes to new jobs, better skills, more housing and improved opportunities for our people.
We have the potential to compete nationally and globally – devolution gives us the funding and powers we need to make it happen.
What are the benefits of devolution?
Devolution provides an opportunity to build on our successes and provide new opportunities for everyone.
This deal gives us the power to make decisions about our own future. It also directly provides £600 million of extra money that we would not receive otherwise. This funding will be used to generate £1.1 billion for the local economy, as well as leveraging £2.1 billion in private sector investment.
Devolution gives us the opportunity to plan for long-term investment in housing, jobs, business and education. Money will be targeted at projects that best meet the needs of residents and businesses, and on those that will have the biggest impact on the future prosperity of the North of Tyne and wider North East.
Having an Elected Mayor gives us a seat at the national table in discussing and preparing for Brexit. It will ensure we have a strong voice, alongside Mayors from Liverpool, Manchester, Tees Valley and the West Midlands, as critical decisions are made about our future.
Where does the money come from?
Central Government will provide an investment fund of £20 million per year for the next 30 years to the North of Tyne Combined Authority to support our economic growth. The combined authority will have the power to decide how, where and when that money is spent but has to update Government every five years on its spending plans.
How long will it last and will there be future opportunities?
The funding that is attached to the devolution deal is for 30 years.
The deal that has been signed by Government and the North of Tyne acknowledges that this is the beginning of devolved powers and funding, and that there is a clear will to add further devolution opportunities in future. This has happened in other areas like Greater Manchester and Liverpool in the past few years.
Why was a devolution deal rejected last year? Is this not just a rehash of that?
A devolution deal was agreed with Government last year for the whole of the North East region but the Secretary of State withdrew the deal after the North East Combined Authority voted not to proceed with the consultation required to progress the project.
Newcastle, North Tyneside and Northumberland councils all voted to proceed with that deal and have been in negotiations with Government since the beginning of 2017 about a devolution deal for the North of Tyne. Those negotiations have now resulted in a ‘minded to approve’ deal being announced.
The deal for the North of Tyne is a new one and is geared towards the specific economic opportunities and challenges of the area. While the other North East authorities are not part of the deal, the economic benefits of the deal will be felt by people and businesses in the wider North East area.
Why was there not a referendum about devolution?
Areas wishing to set up a combined authority are required by law to consult with residents in the area on their proposals and for the results of that consultation to be considered by the Secretary of State before he decides to lay the order in parliament that will create the combined authority.
This is the process that we will undertake over the next couple of months. The process is being driven by three democratically elected councils and will be supported by resident consultation across the whole of the North East. This is the same process that has taken place across the country in a number of mayoral combined authority areas including Greater Manchester, Liverpool, West Midlands and Tees Valley.
A referendum would be extremely costly and, in view of the process described above, is not necessary.
What is the North of Tyne Combined Authority?
The North of Tyne Combined Authority will be the organisation that manages the devolved powers and funding for the area.
It will have an Elected Mayor (voted for by electors within the North of Tyne area) who will chair the Cabinet. In addition to the Elected Mayor, the Cabinet will be made up of six representatives from Newcastle, North Tyneside and Northumberland councils plus representatives from the North East Local Economic Partnership (NELEP) and the business community.
The new combined authority has not been set up yet. Its formation is subject to the consultation exercise in December and January and the Secretary of State for Communities and Local Government deciding to place the relevant legal orders before after that.
Don’t we already have a combined authority in the North East?
Yes, the North East Combined Authority (NECA) currently comprises the seven councils that serve County Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside and Sunderland.
Subject to Secretary of State serving the required orders in Parliament, Newcastle, North Tyneside and Northumberland councils will leave NECA to create a new North of Tyne Combined Authority.
Will the individual councils close down?
No. The three councils will continue to exist and have the same role and responsibilities they do now.
The North of Tyne Combined Authority will be set up to take and use powers and funding from Westminster. It will not take existing local powers from the three councils.