A MAYOR has been accused of “selling the people of Teesside down the river” after an agreement saw more shares in a vast regeneration scheme go to private firms.

Stockton North MP Alex Cunningham has hit out at Tees Valley Mayor Ben Houchen after it was revealed 90% of shares in Teesworks are now in private hands.

But the Conservative mayor has returned fire – arguing private sector investment is “essential” to the future of the former steelworks land, and a public body will “still control the site”.

Joint venture partners JC Musgrave Capital and Northern Land Management joined forces with the South Tees Development Corporation (STDC) in 2020 in a bid to realise ambitions for the 4,500 acre site south of the River Tees.

The firms held a 50% stake in Teesworks – with the STDC holding the other half.

But now 90% of shares in Teesworks Ltd rest in the hands of JC Musgrave Capital, Northern Land Management Ltd, and DCS Industrial Limited.

Read more: Teesworks agreement sees majority of shares held by private firms

The STDC retains a 10% stake in Teesworks – with its board agreeing to the new 90/10 split late last year.

However, Mr Cunningham believed “serious questions” needed answering about the arrangement.

The Labour MP said: “The Conservative Tees Valley Mayor is selling the people of Teesside down the river and hiding behind a cloak of secrecy – sneaking out this takeover of Teesworks by a small group of people just before Christmas.

“Taxpayers footed the bill when the site was purchased and cleared for development – and it is only right that the wider public, not the pockets of big business, get the benefits of the development.

“The Conservative Tees Valley Mayor has serious questions to answer about this takeover.”

Site has “taken off”

Teesside businessmen Chris Musgrave and Martin Corney lead the joint venture partners at Teesworks.

DCS Industrial Ltd, which now holds 40% of Teesworks Ltd shares, was formed in 2019 and is owned by the partners.

JC Musgrave says the nature and scale of the projects mean the private sector “needs to be at the heart of delivery” – with “knowledge and expertise in development and regeneration”.

Last week, a spokesperson for the firm said the site had “taken off” – with more than 600 acres of land cleared, a further 400 acres set to be cleared by June.

The spokesperson added: “GE (General Electric) will now create their new wind turbine blade factory, which will result in many other companies from the renewable energy sector taking up other land on the site.

“Indeed, a number of such companies are close to agreement with Teesworks with others having already agreed and signed heads of terms.

“The site is flying and it will soon be the home to many companies who will employ thousands of local people.”

Read more: Pictures show what's left to buy at Darlington Cleveland Bridge

The firm added the shares change “reflects the significant capital investment” needed to continue to remediate land and prepare it for investments.

The spokesperson said: “The arrangement will allow STDC as a public sector organisation to benefit from significantly reduced future financial liability, with further private sector investment and the reinvestment of capital receipts from the sale of land.”

Hundreds of millions of pounds of public money has been put towards the former steelworks site since SSI closed in 2015.

In response, Mr Houchen said many people “including the Labour Party” pointed to costs of £1bn when the steelworks shut.

The Tory mayor added: “Everyone said it was a huge financial millstone and a safety risk to local people.

“The STDC’s objective was to demolish and make safe the site.

“When I set it up, nobody believed we could achieve what we have so far.

“Everyone thought the site would be a derelict and dangerous burden for local people for decades to come.

“Well, by June this year we will have spent the £240m I secured from the Government achieving this objective and the steelworks will be completely gone.”

“Unfair”

The mayor said he’d “changed the STDC’s future plan” to prepare the site to “attract investment and jobs”.

He argued the money received from the Government “was only to demolish and make safe the site” to make it easier for the private sector to invest.

“Otherwise the site would stay empty forever,” said Mr Houchen.

“There are still hundreds of millions needed to redevelop this site.

“Due to the impact of covid on national and local finances – with public borrowing at record levels and a cost of living crisis looming – it would be unfair for taxpayers to pick up the bill for this phase of work when they’ve already done so much.

“The alternative option was to mothball the site completely and put a stop to all of the progress we’ve made to date.

“It was essential that we secured private sector investment to secure jobs and full redevelopment of the site.”

The metro mayor repeated his belief that the joint venture partner “allows us to have our cake and eat it”.

He added: “We still control the site, we still have significant ownership and we have legal commitments that our joint venture delivery partners will invest more than £150m to help me take the site to the next stage.

“Our joint venture delivery partners also take the liability away from STDC and the taxpayer as there are still hundreds of millions of liabilities across the site.”

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