Instruments drawn to the special attention of the House
Draft Newcastle Upon Tyne, North Tyneside and Northumberland (Combined Authority) (Establishment and Functions) Order 2018
Date laid: 24 July 2018
Parliamentary procedure: affirmative
Summary: The Order proposes to set up a mayoral Combined Authority for the areas of only three of the seven councils which were previously brought together in the North East Combined Authority (NECA) in 2014. Three of the other NECA councils support continued regional joint working, but are concerned that the creation of the new mayoral Combined Authority may have adverse consequences for councils not participating in it. Key business stakeholders appear to view the latest proposal as a second-best option and still favour an approach based on participation by all seven councils. It will be important that all involved keep under review the effectiveness of cooperation between the new Combined Authority and the other councils, and that the Government should be ready to adapt arrangements in the light of experience.
We draw this Order to the special attention of the House on the ground that it gives rise to issues of public policy likely to be of interest to the House.
2.In the last four years, the Government have laid several instruments relating to the devolution of powers to authorities in the North east.
2014 Order
3.The Durham, Gateshead, Newcastle Upon Tyne, North Tyneside, Northumberland, South Tyneside and Sunderland Combined Authority - known as the North East Combined Authority (NECA) - was established in April 2014. In the Explanatory Memorandum (EM) to the instrument concerned,1 the Department for Communities and Local Government (DCLG) said: “Establishing the Combined Authority will materially strengthen collaboration and joint working between the local authorities and with their Local Enterprise Partnership on economic development, regeneration and transport, thereby promoting more effectively economic growth and prosperity for the area concerned.”
2016 Order
4.In July 2016, DCLG laid a draft Order proposing the creation of an elected mayor for the NECA.2 We drew this draft Order to the special attention of the House in our 7th Report of the 2016–17 Session,3 noting that DCLG had explained that, while the other councils comprised in the NECA had provided the consents needed for the Order to proceed, Gateshead Council had not done so. DCLG said that, if Gateshead continued not to provide consent by the time that the Order was made, the Secretary of State would be required to make another Order removing the area of Gateshead Council from the existing NECA area. In September 2016, however, the Government withdrew the draft Order after local leaders in the North East decided not to proceed with the underlying Devolution Deal for their region.
2018 Order
5.In the EM to the latest draft Order, the Ministry of Housing, Communities and Local Government (MHCLG) says that it establishes a new Combined Authority for the area of Newcastle upon Tyne, North Tyneside and Northumberland, including provision for a directly elected Mayor, and for the date of the first and subsequent elections to the role of Mayor and the term of office. MHCLG says that the Order removes the local government areas of Newcastle upon Tyne, North Tyneside and Northumberland from the area of the Durham, Gateshead, Newcastle Upon Tyne, North Tyneside, Northumberland, South Tyneside and Sunderland Combined Authority and renames it the Durham, Gateshead, South Tyneside and Sunderland Combined Authority.
6.MHCLG says that the Order is a significant step in implementing the devolution deal that the Government announced that they were minded to agree with the North of Tyne councils (Newcastle upon Tyne, North Tyneside and Northumberland) at Budget 2017. When the four councils south of the Tyne (Durham, Gateshead, South Tyneside and Sunderland) chose not to participate in the North East devolution deal in September 2016, the Government were clear about continuing to work with those committed to devolution. The North of Tyne devolution agreement provides for a new mayoral combined authority and for powers to be conferred on the new authority, with certain powers to be exercised by the mayor, as well as devolving significant budgets, including an investment fund of £600 million over 30 years. The agreement also provides for the establishment of a joint transport committee to exercise the transport functions of both the new authority and the existing NECA, so as to maintain integrated transport across the whole of the North East.
Consultation
7.The Department explains that the three North of Tyne councils undertook a consultation on the proposals contained in their scheme for the new Combined Authority, over seven weeks from 14 December 2017 to 5 February 2018. They submitted a summary of consultation responses to the Secretary of State in February 2018.4 In the EM, MHCLG provides a good deal of information about the consultation. There were 1,082 responses to a question that asked whether respondents agreed or disagreed with the proposals to change the way the councils in the North East worked together in order for the devolution deal for the North of Tyne to be implemented: 541 (50%) respondents agreed with the proposals, 129 (12%) neither agreed nor disagreed with the proposals, and 412 (38%) disagreed with the proposals.
8.MHCLG says that key business stakeholders5 voiced a preference for a devolution covering the geography of all seven councils in the North East, and that they saw the implementation of the North of Tyne devolution deal as an important first step. The Department notes that others expressed concern over the deal, including Unison and Unite, who specifically raised concern over the impact of the deal on the NECA, and Historic England, who had reservations regarding the geography.
9.MHCLG also says that the responses from Durham, South Tyneside and Sunderland councils showed a commitment to continuing support for joint regional working to enable the growth of the regional economy, while being clear that any establishment of a new mayoral combined authority should not be to the detriment of the area south of the Tyne. Those responses have been published as Appendix E to the February 2018 consultation summary. They make it clear that the councils involved are concerned that the advent of the new Combined Authority should be accompanied by “safeguards [to] ensure there is no prejudicial treatment of any future funding bid from NECA, or a dilution of NECA’s working relationship with Government … “, as stated in the letter of 7 February 2018 from Sunderland City Council.
Conclusion
10.Progress towards establishing a mayoral Combined Authority in this part of the North East has not been straightforward. The latest Order proposes such an authority for the areas of only three of the seven councils which were previously brought together in the NECA in 2014. Three of the other NECA councils support continued regional joint working, but are concerned that the creation of the new mayoral Combined Authority may have adverse consequences for councils not participating in it. Key business stakeholders appear to view the latest proposal as a second-best option and still favour an approach based on participation by all seven councils. It will be important that all involved keep under review the success of cooperation between the new mayoral Combined Authority and the other councils, against the objective identified by DCLG in 2014 of promoting more effectively economic growth and prosperity for the area concerned; and that the Government should be ready to adapt arrangements in the light of experience.
1 The Durham, Gateshead, Newcastle Upon Tyne, North Tyneside, Northumberland, South Tyneside and Sunderland Combined Authority Order 2014 (SI 2014/1012).
2 The Draft Durham, Gateshead, Newcastle Upon Tyne, North Tyneside, Northumberland, South Tyneside and Sunderland Combined Authority (Election of Mayor) Order 2016.
3 7th Report, Session 2016–17 (HL Paper 32).
4 Newcastle City Council, North Tyneside Council, Northumberland County Council, North of Tyne Consultation Report (February 2018): https://northoftynedevolution.com/wp-content/uploads/2018/02/North-of-Tyne-devolution-consultation-report.pdf [accessed 5 September 2018].
5 These included the NELEP, Confederation of British Industry North East, Entrepreneurs Forum, Federation of Small Business, North East Chamber of Commerce, North Tyneside Business Forum, Port of Tyne and Northumberland Business Support Limited.