North East joins 'unstoppable momentum' of Northern Powerhouse

Chancellor George Osborne
Chancellor George Osborne

Chancellor George Osborne will hail the ‘unstoppable momentum’ in the drive to strike devolution deals with cities and regions, as the North East today becomes the latest area to make a historic agreement with the Government to take on new powers.

The agreement delivers another significant boost to the Northern Powerhouse as the Chancellor and Northern Powerhouse Minister James Wharton are set sign a deal with the North East Combined Authority.

Voters in the North East will now choose a directly elected Mayor in 2017, who will take on a raft of new powers as part of plans to take power out of Whitehall and hand it back to local people.

The deal presents a significant financial boost for the North East who will receive £30million a year over the next 30 years, enabling the region to compete in international markets with a new Investment Fund being set up thanks to a guaranteed £900million from the Government.

The new Mayor in the North East will oversee a range of powers devolved from government and the Chancellor announced recently that Mayors will also have the power, if they have the support of the local business community, to raise business rates to help fund new infrastructure, enabling them to build for their city’s future.

The North East deal, provides for the transfer of significant powers over transport, strategic planning, employment and skills from central government to the region and it paves the way for further devolution over time, and for the reform of public services, including potentially health and social care, to be led by the North East.

Today’s announcement, alongside a similar deal also being announced in Tees Valley, brings the number of city regions across the north signing up to game-changing mayoral devolution deals to four, with Greater Manchester and Sheffield also creating powerful new metro Mayors.

The deal requires support from each of the local councils within the region, as was the case with previous deals to Sheffield and Greater Manchester.

Devolution deals underline the government’s commitment building a Northern Powerhouse to help rebalance the economy and ending the old model of running everything out of London

The Chancellor said: "This announcement shows that our revolutionary plans for devolution are gathering an unstoppable momentum. The civic leaders of the North East have worked incredibly hard to reach this point and as a result today we are signing this historic agreement which will give the area significant new powers and investment.

"Once again the Northern Powerhouse is leading the way in our ambition to take power out of London and give it to the people who know their areas best."

Northern Powerhouse Minister James Wharton said: "Our long-term economic plan seeks to rebalance growth and build a Northern Powerhouse. By ending the ‘one size fits all’ approach of the past, we are giving local people the powers they need to boost jobs and skills.

“Today’s deal means the North East is leading the way, with significant new powers and nearly £1billion of Government investment over the next three decades. This will enable the region to compete nationally and on the international stage. I look forward to seeing how a future Mayor and combined authority work with the business community to make their ambitions a reality."