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  1. ITV Report

Government and three North East councils agree devolution deal

Signing the deal Photo: ITV

By Kris Jepson

Details of the £600m devolution deal for Newcastle, North Tyneside and Northumberland councils that was promised in the Chancellor's Autumn Budget, have been revealed.

It means that these three councils - serving communities north of the River Tyne - will join together to create a new North of Tyne Combined Authority, which will be led by an elected regional mayor.

Leader of Newcastle Council, Cllr Nick Forbes, said "this is about investing in our economy, investing in skills, investing in new homes, so this is extra money coming in. This is not money that's been taken off local authorities. This is new money from government that we've won".

Watch @krisjepson's report here:

The four local authorities south of the Tyne - Gateshead, Sunderland, South Tyneside and Durham County Council - rejected a previous devolution deal last year because they claimed it was "not a financially fair deal" considering the billions of pounds worth of government cuts to local government budgets.

Devolution Deal Credit: ITV News

The Northern Powerhouse Minister, Jake Berry MP, told ITV News "the door is never closed" to those four councils if they want to return to the negotiating table.

What I would say to anyone about devolution, this deal minded to that we've signed today isn't the end of the conversation, it's the start of the hugely exciting conversation for the north of the Tyne and for this region, so the door will never be closed on the boroughs south of the Tyne who want to take part in this devolution revolution.

– Jake Berry MP, The Northern Powerhouse Minister

Reacting to the government's offer, leader of Gateshead Council, Martin Gannon did not dismiss entering into talks again, but said any deal would have to be right for the people of Gateshead.

I'm not fully aware of all of the details yet, of what's in the north of the Tyne package yet, but of course, clearly, we will examine it. I'm very grateful that the door is open and the representatives of Gateshead Council and the population of Gateshead, our councillors, will consider all of those details and we will resolve to do what we believe will be in the best interests of the people in Gateshead.

– Cllr Martin Gannon, Leader, Gateshead Council
Devolution Deal Credit: ITV News

The Devolution Deal

The 815,000 people living in Newcastle, North Tyneside and Northumberland will benefit from an extra £20m a year of investment and will vote for a regional mayor, who will have new powers in housing, planning and skills. The Treasury predicts the deal will:

  • Boost the region's economy by £1.1bn
  • Create 10,000 new jobs
  • Provide new trains for the Tyne and Wear Metro, costing £337m
  • Create and Adult Education Budget
  • Create a board to improve skills and employment