The North East Combined Authority has signed a devolution deal with government that will see major transport powers and £900m handed over in return for a directly elected mayor.
Under the deal, the mayor will be elected in 2017 and be responsible for a devolved and ‘consolidated’ transport budget under a multi-year settlement to be agreed at the Spending Review.
They would also have responsibility for franchised bus services in the city region and by working with Rail North, franchised rail services. It is hoped this will provide a further springboard to deliver smart and integrated ticketing across the North East.
Similarly to other arrangements signed recently with Sheffield and Manchester, the North East will receive £30m a year over the next 30 years, enabling the region to create a new investment fund to boost infrastructure.
And further to the chancellor’s recent announcement at the Conservative Party conference, the mayor will be able to raise a premium on business rates as an ‘infrastructure levy’ – provided it is approved by a majority vote of the business members of the Local Enterprise Partnership.
Chancellor George Osborne said: ‘This announcement shows that our revolutionary plans for devolution are gathering an unstoppable momentum.
‘The civic leaders of the North East have worked incredibly hard to reach this point and as a result today we are signing this historic agreement which will give the area significant new powers and investment.’
The mayor will also take powers over strategic planning, including the responsibility to create a ‘North East Planning Development Framework and to chair a new North East Land Commission to release land for development’.
Government and the combined authority also plan to work together to establish a Health and Social Care Commission for the region, to review the case for further health and social care integration.
Cllr Simon Henig, chair of the North East Combined Authority, said: ‘With devolved powers and responsibilities over both our urban and rural economies, transport, skills and investment and the creation of the new health commission, this brings new opportunities to make a difference to the lives of local people.
‘Not only does this demonstrate the level of our ambition, it also underlines the key role the North East has to play in re-balancing the national economy.
‘We welcome the opportunities which devolution presents and we will now begin further consultation with our partners, residents, business, trade unions and the voluntary and community sector so that everyone can be part of this process as we move forward.’
The North East Combined Authority was established in April 2014 as a new legal body that brings together the seven councils which serve County Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside and Sunderland.
As was the case with previous deals to Sheffield and Greater Manchester, the plans requiree support from each of the local councils within the region.