New money and powers over skills, transport and housing will be devolved to local leaders in the North East, as all seven local authorities unite to create a new combined authority. 

Millions of North East residents from County Durham to Northumberland will be given the power to directly elect a Mayor of the North East at an election in May 2024 if the process is approved following a local consultation. 

Read more: Everything you need to know about new £1.4bn North East devolution deal

The individual will operate in a similar role to Tees Valley mayor Ben Houchen and will help attract investment to the area and act as a powerful local voice in discussions with central government and other bodies.

The Government will guarantee the new North East Mayoral Combined Authority (MCA) more than £1.4 billion over the next 30 years which will enable the new mayor and the councils to plan for the long term, with certainty, and unlock the benefits of devolution for two million people living in the area.

However, the announcement has not been welcomed by all political parties in County Durham. Earlier this month, Labour failed in an attempt to convince councillors to back its preferred option of a single county deal, with party leader Carl Marshall accusing the coalition of being ‘incompetent’ for denying the chance of securing a ‘once-in-a-lifetime’ county deal. 

Read more: County Durham closer to joining North East-wide devolution deal

Instead, Liberal Democrat council leader Amanda Hopgood’s proposal that the council secures a devolution deal that is “best for County Durham residents and businesses” was backed.

But Labour fears this deal would short-change the county and it would be left to receive ‘crumbs off the table’. The group fears a regional mayor, selected from one of the North East’s seven councils, won’t have the best interests of the county’s people and places at heart.

Durham County Council was previously considering its own single-county devolution deal instead of joining a region-wide body, but it is understood Government insistence that such an arrangement would require the election of a county mayor was a sticking point for the council’s coalition.

It believes the deal will ensure the North East has more funding, power and flexibility to make important decisions based on what is best for people across all seven local authority areas. 

Levelling Up Secretary Michael Gove said: “I’m proud to have agreed a historic new devolution deal with the North East that gives local leaders more power, more money, and an even greater say on how their areas are run.

“Devolution is all about letting leaders who live and breathe the region decide what is in their best interests, for their people and for their businesses.

“A new mayor will ensure local priorities in the North East are at the heart of decision-making, while our billion-pound funding boost will provide the financial certainty needed to level up the area right now and for years to come.”

The proposed deal sets out the government’s plans to devolve more power to the North East through:

  • Education and skills: The deal provides the region with powers to better improve local skills through full devolution of the Adult Education budget and a greater say over the Local Skills Improvement Plan, which brings together local businesses, colleges, and training providers to identify the skills needed to support local growth. 
  • Housing and regeneration: The North East will receive £17.4 million to support and accelerate the building of new homes on brownfield land, as well as £20 million to level up and kick start regeneration, delivering new affordable homes and green economic growth across the region.
  • Transport: A new City Region Sustainable Transport Settlement with government will give the North East control of up to £563 million to help shape and improve local rail services across the region, as well as the ability to introduce bus franchising.
  • Local leadership: From 2024, the North East will have a directly elected mayor who can champion the area, help drive investment to the region, and can represent local people in conversations with national government.

Building on existing collaboration across the region and with central government, the new North East MCA will replace the existing North of Tyne MCA and Mayor, currently ran by Labour’s Jamie Driscoll, as well as the non-mayoral North East Combined Authority. 

These changes are subject to the statutory processes, including local consultation and Parliamentary approval. The deal is being published today to allow necessary governance steps to proceed and will be signed in in the early new year.

Local leaders and mayors across the whole North East, including County Durham’s Amanda Hopgood, welcomed the news in a joint statement:

“This is a significant step towards securing important decision-making powers and investment for our region. This would allow us to make decisions that reflect local needs and invest wisely into projects that will make a difference for all our residents, communities and local economy,” it read.

“There remains a process for all councils and combined authorities to consider the details and a public consultation before a final decision is made.

“We are pleased that we have successfully negotiated a proposed deal which is a step towards reaching our ambition for this region. This is an important milestone in our journey and we will now engage with stakeholders to move the deal to the next stage.”

John McCabe, Chief Executive, North East England Chamber of Commerce, said: “Leaders from across Northumberland, Tyne and Wear and County Durham have worked tirelessly to get this settlement over the line. Throughout the business community there has been unwavering support for the advantages we know stronger devolution brings – the freedom to build projects, programmes and partnerships which truly deliver for the North East.

“County Durham’s inclusion is very warmly welcomed, we know the region will benefit hugely from this. It demonstrates bold, visionary leadership. 
 
“Congratulations to everyone involved so far – this marks a real step change in opportunity and ambition for the region.”