A parliamentary select committee has urged the government to further scrutinise financial deals linked to UK freeports, including Teesworks.

On Friday (April 26), the House of Commons Business and Trade Committee published its report on the 'performance of investment zones and freeports in England' - which called for more scrutiny when it comes to public funds linked to Teesside Freeport and those linked to it.

In its 33-page report, the committee noted that freeports must have "more transparency" when it comes to funding and financial deals, as well as governance of the sites.

The Northern Echo: The Teesworks siteThe Teesworks site (Image: PA MEDIA)

This report comes after an independent investigation into Teesworks, The Tees Valley Review, found no illegality, but put forward 28 concerns, which included the site lacking transparency.

 In its conclusion within the report, the committee, which includes North East MPs, Ian Lavery and Andy McDonald, states: "To improve transparency and to facilitate accurate cost-benefit analyses of freeports and investment zones, the Government must publish quantitative assessments of the impact of freeports and investment zones on employment, investment and trade alongside the Freeports Annual Report."

It also suggested: "The Government must enhance scrutiny and audit of mayoral combined authorities. Improvements could include making additional funding provided to combined authorities conditional on high attendance and engagement with scrutiny meetings or piloting local audit account committees."

In relation to the Teeswork site, the report agrees with several recommendations put forward by the independent Tees Valley Review, which are: 

  • TVCA should ensure a full understanding of the liabilities of both STDC and TVCA in relation to the activities of STDC and TWL and ensure appropriate management arrangements are in place to manage and mitigate the consequential financial risks to both organisations and the constituent authorities.
  • STDC should explore opportunities to influence when and how land is drawn down and developed and if possible, renegotiate a better settlement for taxpayers under the JV agreement.
  • STDC [Director of Finance and Resources] should work with the external auditor to support the completion of their value-for-money arrangements work for 2021/22, including any additional risk-based work that may arise in light of the Panel’s findings. The progress of this work should be reported to TVCA and STDC Audit Committees.

The Teesworks Freeport opened in 2021 with a vision of creating 18,000 jobs across five years.

However, allegations of corruption were raised after 90 per cent of the site was sold to two private businessmen.

So far, according to the select committee report, £21m million of seed funding has been spent developing the Teesworks site.

Further into the report, it states that 2150 people are currently employed in the Teesside Freeport, and this figure is expected to be 41,780 by 2043, according to the report.

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In its summing-up statement, it called on those involved in Teesworks to: "recognise Teesside Freeport’s flagship status, to address the gravity and breadth of the concerns raised by the Tees Valley Review, to extend scrutiny beyond the limited remit of the Tees Valley Review and to assure the public that taxpayers’ money has been disbursed appropriately and legally, the Secretary of State for Levelling Up, Housing and Communities must direct the National Audit Office to scrutinise the expenditure of public funds associated with Teesside Freeport, Tees Valley Combined Authority and South Tees Development Corporation.

Conservative Ben Houchen, Tees Valley mayor and head of TVCA, has consistently denied any wrongdoing and urged the government to commission an inquiry.

Mr Houchen has been approached for comment.