North East trailblazer devolution deal

Author - Marianne O'Sullivan

Date published:

With elections coming up soon on the 2 May for the North East Mayor, here is a briefing note for members on the trailblazer deal for the new North East Mayoral Combined Authority (NEMCA). This is an agreement between the government and the North East local authorities to deepen and extend the combined authority’s powers and will provide £100 million of new funding.


Introduction

The leaders of County Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside, and Sunderland councils have agreed to form a new mayoral combined authority with access to significant new funding and powers. That authority will form in May following a mayoral election.

Elections for the new mayor will take place on the 2/5/24. The North East will have a directly elected mayor, who will provide overall vision and leadership, seek best value for taxpayer money and receive new powers on housing, transport, and skills. The mayor will lead a board with representatives from the seven local authorities and access to a North East investment fund of £48 million per year for 30 years.

In the recent Spring Budget (6/3/24) the government announced a trailblazer deal for the new North East Mayoral Combined Authority (NEMCA). This is an agreement between the government and the North East local authorities to deepen and extend the combined authority’s powers and will provide £100 million of new funding.

This document will provide a briefing note on what the new trailblazer deal means for the North East.


Overview

The deal will give NEMCA £100 million of new funding as well as greater control over regeneration and affordable housing, the local transport system, and skills and employment support.

It will also allow NEMCA to work with government to design bespoke programmes to support economic growth and employment in the region.

Funding will be used to create growth zones in Sunderland and Newcastle and to cover the maintenance and renewal of the Tyne and Wear Metro system for the next two years.

Collaboration with the Darlington Economic Campus

The government and NEMCA agree to pilot new collaborative working arrangements to help deliver priority projects in the region.

There will also be a pilot secondment scheme between the Department for Levelling Up Housing and Communities and NEMCA.

Housing and regeneration

NEMCA will be able to work with Homes England on a Strategic Place Partnership (SPP). The plan will focus on housing affordability; choice and accessibility; regeneration and inclusive growth; net zero and ensuring communities are well-connected.

Additional funding for brownfield sites will enable NEMCA to bring forward sites across south of Tyne authorities.

NEMCA will work in partnership with the Department for Levelling Up, Housing and Communities and Homes England on the deployment of the Affordable Homes Programme across the region from 2026.

The government will work with NEMCA to establish a Homelessness Prevention Blueprint which will create a bespoke plan for the North East.

Transport

The North East mayor will be responsible for a devolved integrated local transport settlement for the North East which the government will provide from the next multi-year Spending Review.

The government will provide £58.4 million of capital funding in 2025/26 and 2026/27 for Metro’s Essential Renewals Programme.

NEMCA will develop a formal rail partnership with Great British Railways (GBR), which will be overseen by a North East rail board. The board will allow for NEMCA, GBR and the government to jointly develop plans for improvements to rail infrastructure and services in the North East.

The government will continue to support NEMCA as it develops business cases for the Washington Loop and other regional rail schemes.

The government will devolve powers for the payment of the Bus Service Operators Grant to NEMCA.

There is also an aim to have multimodal ‘pay as you go’ journeys across bus, Metro and on rail such as the Northumberland Line with fares subject to a daily cap and discounted fares for young people as part of the existing Pop brand.

Once elected NEMCA will support the mayor in creating a Key Route Network of local authority roads. This will allow the most important local roads to be managed in a strategic way.

NECMA will work to establish a Zero Emission Vehicle Charging Infrastructure strategy.

Education and skills

The government will devolve non-apprenticeship adult skills functions and grant funding to NEMCA.

The government will work with NEMCA to co-design a small number of pilot models for skills development, linked specifically to advanced manufacturing, digital, green energy, health and social care, as well as creative sectors such as culture, film and TV.

NEMCA will act as a central convenor of careers provision in the region.

Employment support

NEMCA will convene a new Regional Labour Market Partnership Board to strengthen working with the Department for Work and Pensions (DWP).

DWP and NEMCA will work together to jointly scope potential NEMCA-led employment support pilots tailored to the region’s needs.

Growth, investment innovation

The Department for Business and Trade (DBT) will establish a Strategic Productivity Forum which will involve NEMCA and other devolved bodies discussing closer working and co-operation.

NEMCA will be able to work closely with the British Business Bank on areas such as the Northern Powerhouse Investment Fund II.

DBT will support the development and implementation of a NEMCA-specific export plan.

NEMCA will have access to £160-million to create an investment zone. This will include a package of policy interventions which will boost industrial clusters in advanced manufacturing and offshore wind, reflecting the region’s long-standing sectoral strengths.

Growth zones can also be created where 100% of business rates growth above an agreed baseline will be retained for 25 years. NEMCA’s intention is to use the growth zone to support early development of the Riverside Sunderland site, to accelerate progress on a health innovation zone- including the health innovation neighbourhood and Forth Yards sites in Newcastle.

Net Zero and energy

NEMCA will work to create a North East Green Superport (bringing together the Ports of Newcastle, Blyth and Sunderland and Newcastle International Airport). This will include the creation of an industry-leading green energy research centre of excellence and the decarbonisation of all ports.

NEMCA will establish a North East Strategic Energy Board to guide energy policy in the region. The board will be able to coordinate and align energy demand with grid supply.

NECMA will develop a North East retrofit capacity building programme.

Digital

The Department for Science, Innovation and Technology will work with NEMCA to establish the North East as a national Innovation Region of Excellence focused on 5G and advanced wireless infrastructure.

Building Digital UK will engage with NEMCA on a regular basis on delivery plans, implementation, and progress in rural parts of Northumberland and County Durham.

Culture, creative industries, heritage, sport and visitor economy

The North East Culture, Creative, Tourism, Sport and Heritage (CCTSH) blueprint will be created to drive collaboration and pilot new ideas.

The culture and creative sector catalyst will be established as an investment vehicle to grow the culture and creative sector through innovation and research and development, and new investment at scale.

Rural, coastal and environmental

NEMCA will establish a North East Coastal and Rural taskforce with representatives from local and national government.

The taskforce will develop a Coastal and Rural Economy Transformation blueprint for the North East. This Blueprint will set out a series of agreed policy interventions to protect the environment and boost living standards in the region’s rural and coastal communities.

Public sector innovation
NEMCA and the Liverpool City Region Combined Authority will act as public sector innovation trailblazers exploring the use of data and evidence.

Conclusion

The announcement of a trailblazer devolution deal for NEMCA is a massive boost for the region. It will be warmly welcomed by our members and demonstrates the government’s belief in the North East to get the job done.

As the go to voice of business in the region, we look forward to playing a full and active role in the project’s success, helping to create a stronger, fairer North East.

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