Councillors in County Durham are to be asked to endorse proposals for a North-East devolution deal which would bring £4.2 billion of investment to the region over the next 30 years.
Members of Durham County Council’s Cabinet will next week hear that with councils in County Durham, Newcastle, Sunderland, Gateshead, Northumberland and North and South Tyneside working together, the deal would create one of the largest combined authorities in the country.
The new body would have access to millions of pounds of additional funding and direct control over how it is invested in the region.
It would be chaired by an elected mayor, with no changes to the governance or provision of services in the existing local authorities. Elections for the new mayor would take place next year.
Cllr Amanda Hopgood, leader of Durham County Council, said: “The proposed deal would see a significant shift of powers, funding and responsibility from central government to our region.
“Working alongside our colleagues in the other authorities, it would allow us to pursue our ambitions for the growth of our area and the wider region, which can only benefit everyone who lives in County Durham and the wider north east.”
In February 2022, the government published the Levelling Up White Paper, setting out a framework for devolution and, for the first time, offering the option for standalone county deals.
As well as identifying the potential for an extended Mayoral Combined Authority for the North-East, the paper invited County Durham to enter into discussions with Government regarding a potential county deal.
Following these discussions, it became apparent that a county deal did not offer the best deal for the people of County Durham, and it was agreed that County Durham should instead enter into discussions to become part of the wider regional deal.
Cllr Hopgood added: “Our aim has always been to seek the best possible devolution deal for the people of County Durham.
“It was right that we gave proper consideration to a county deal when the government invited us to discuss the proposal. However, we believe it was clear from these discussions that for County Durham, the best option was to join a wider, regional deal.
“An LA7 deal will give us access to more funding and additional powers and more opportunity for deeper devolution. By becoming a part of the fourth largest devolution deal in the country, we will also have greater influence at a national level.
“There will also be more flexibility as to how money can be spent and more opportunity for private investment.
“We have a proven track record of working closely with the other councils and I am confident that we can continue and build on that work to ensure that this deal brings opportunities for County Durham and the region as a whole.”
By joining the regional deal, County Durham will have access to £120m more in funding than it would have through a standalone county deal, while economic estimates suggest that 6,500 new jobs could be created in Durham within a LA7 deal – 2,000 more than in a county deal.
It is also estimated that the LA7 deal will attract £1.34bn private sector investment into the county, some £400m more than that estimated in a county deal.
For the region as a whole, the deal offers a potential £4.2bn of investment, made up of elements including:
• An investment fund of £1.4bn, or £48m a year, to support inclusive economic growth and support our regeneration priorities.
• An indicative budget of around £1.8bn, or £60m a year, for adult education and skills – to meet local skills priorities and improve opportunities for residents.
• A £900m package of investment to transform our transport system, with £563m from the City Regional Sustainable Transport Fund, on top of funding already announced for our buses and metro system.
• £69m of investment in housing and regeneration, unlocking sites to bring forward new housing and commercial development.
If all seven councils agree to the deal ‘in principle’, proposals on how the new authority would work would be developed, with members of the public then being given the chance to have their say on the plans during a regionwide consultation.