Levelling Up: Majority of funding for projects in North East & North Yorkshire not yet spent

  • Co-written and researched by Tom Sheldrick and Madeleine Letherby

The majority of funding announced by the government for local regeneration projects in the North East and North Yorkshire has not yet been spent, and the majority of schemes have not yet been delivered, our research has found.

Between 2020 and January 2023, more than £400m was announced for projects in our region through the Towns Fund and Levelling Up Fund, as part of government pledges to tackle regional inequalities and "level up" the country.

ITV News Tyne Tees contacted all of the councils and combined authorities whose bids were successful. They have provided different levels of information, and summaries of their responses are below.

We showed our findings to Henri Murison, chief executive of the Northern Powerhouse Partnership, a think tank and advocacy group for the North of England.

He said: "These ways of allocating funding are fundamentally not the best way of doing things. There's been huge delay, huge additional cost, which you can demonstrate through this work, from having gone about it this way."

Mr Murison continued: "Often what was happening was that areas were having to find projects to fit the fund, and that means that although you might be able to get a project ready to put in a bid, it isn't necessarily something you've done a lot of work thinking about beforehand, and so inevitably it takes time to finish and design up."

He told us the government should instead increase basic funding to councils, with fewer strings attached.

The government has responded to our findings, saying: "Levelling up is an ambitious long-term programme of reform that is breathing life into overlooked communities, and we are investing over £2bn in the North East and over £3bn into Yorkshire and the Humber to support local economic growth and level up.

“This includes a number of projects such as turning Hartlepool’s Wesley Chapel into a hotel and creating 55 jobs, a new leisure facility in West Denton, as well as helping to transform Northallerton town centre."

On delays around the Towns Fund, the government argued that it is flexible, with a broad range of projects which are being delivered at pace around the country.

Assessment of the impact of the Towns Fund is expected next year, while the government says it has been advised to wait until 2027/28 for evaluation of the Levelling Up Fund.

Plans to simplify the government's funding pots have already been set out.

  • Analysis from our Political Correspondent Tom Sheldrick

There have been a lot of announcements over the last few years, celebrating 20 million quid for a Teesside town, a similar amount for somewhere else in the North East, etc etc.

There has been criticism of the competitive bidding process, and accusations that money was targeted towards Conservative constituencies, with many other places-in-need missing out.

Now, though, we wanted to ask: How far have the projects got, and what difference have they made?

Neither the government nor councils could give us any firm evidence to answer the second question, largely because the answer to the first one is: they are still a work in progress.

We have been told of delays due to the pandemic, the nature of the funding streams, and the impact of inflation.

Some of the councils have referred to (slightly different) government deadlines for using the funds, which are still a little while away.

But these projects were meant to be quick wins, relatively small amounts of money to help improve pride in place in many previously "left-behind" towns.

Conservative MPs hoping to have an array of shiny new things to point at during a general election campaign next year may be disappointed.

Towns Fund:

Boris Johnson's government announced the creation of the Towns Fund in 2019, as part of their promises to "level up" the country. 

Councils were invited to bid for shares of a total £3.6bn, to "regenerate town centres, boost businesses and improve infrastructure." 

A total of £209.5m was announced for nine places in the North East and North Yorkshire in 2020 and 2021.

Darlington - £22.3m - announced October 2020

One project out of nine has been completed, providing new facilities at Darlington College for T Level students. Darlington Borough Council told us that, as of March 2023, just over £4m of the £22.3m had been spent. An ongoing project is visual upgrades to the historic town centre yards. Plans also include the redevelopment of the northern gateway into the town centre. The council told us it is too early to judge the final impact of the funding.

Some of the money in Darlington is being used to renew the historic yards and the Skinnergate area of the town centre. Credit: ITV News Tyne Tees

Middlesbrough - £21.9m - announced March 2021

Middlesbrough Council says funding has contributed to a number of projects so far, including the building of a new office block, the development of the Middlesbrough College campus and the creation of a nature reserve. The council told us it has until March 2026 to spend all of the allocation, but inflation has made some plans unaffordable.

Thornaby - £23.9m - announced March 2021

Plans include investment in a new swimming pool, tackling vacant properties, and a cycle network. Stockton Borough Council told us the business case for the projects was approved at the end of 2022, a lot of the projects are still in the early phases, and work is underway to prepare for delivering them over the next three years.

Scarborough - £20.2m - announced March 2021

Projects completed so far include improving Scarborough Cricket Ground, and providing facilities for green construction training. North Yorkshire Council says the majority of projects are still in the design, development and consent stages, but are on track to be delivered within the government's March 2026 timeframe.

Whitby - £17.1m - announced March 2021

Projects delivered so far include a new community hub and boxing club facility in the east of Whitby, and improved signage for visitors to the town. North Yorkshire Council says most of the work is still in the early stages, but on track, similar to Scarborough.

Bishop Auckland - £33.2m - announced June 2021

Durham County Council told us a public consultation over plans to improve the town centre will take place in autumn 2023. The council says a project helping local people into work, including providing office space for businesses while they establish themselves, is expected to open in early 2024.

Hartlepool - £25m - announced June 2021

Hartlepool Borough Council says the first phase of a project improving connections to the marina has been completed, the transformation of the historic Wesley Chapel into a hotel is underway, and two skills academies will be opened in 2024. The council told us all work will be finished by March 2026 and is on time and on budget currently. It says the bid for funding was required to demonstrate value-for-money and significant benefits from the projects.

Redcar - £25m - announced June 2021

Projects receiving funding have included an industrial training facility that opened earlier this year. Construction has started on a coastal activity hub, which is due to open in November 2023. Redcar & Cleveland Borough Council says work on improving the appearance of the town centre and esplanade will begin in January 2024, and a new culture venue is due to open in autumn 2025.

This artist impression shows what it is hope the revamped Culture and Leisure Anchor Attraction will look like Credit: Redcar and Cleveland Borough Council

Blyth - £20.9m - announced July 2021

A small amount of the money has been spent on paving, street furniture and flowers to smarten up part of the town centre. Construction is underway on a new clean energy training centre, which is due to open next September.

Northumberland County Council says the Towns Fund has been combined with other government and council investment to form an overall £90m scheme to regenerate Blyth, and two out of 13 projects have been completed so far. The council told us there hasn't been any analysis on impact, as the programme is still in its early phases.

The Energy Central Learning Hub is part of an effort to lead the UK’s clean energy revolution from the North East. Credit: Northumberland County Council

Levelling Up Fund

The Levelling Up Fund was announced by the government in November 2020, with councils and combined authorities invited to bid for a share of £4.8bn to "invest in local infrastructure and support economic recovery."

Across the first two rounds, a total of £227.4m was announced for 12 projects in our region.

The government has said there will be a third round of allocations.

Bishop Auckland - £20m - announced October 2021

Construction is underway on a new building at the Locomotion railway museum in Shildon, which is due to open later this year. Durham County Council says work on a walking and cycling route is due to be finished by March 2024, while plans are still being developed for an A68 bypass and the restoration of Whorlton Bridge.

Newcastle - £19.8m - announced October 2021

A leisure centre with a swimming pool is planned in West Denton. As of June 2023, around £2.6m of the £19.8m has been spent, including on design and preparatory work. Newcastle City Council told us inflation is causing cost issues, and will remain a challenge. The council says it has an allowance in the budget for an independent evaluation once the facility is operational, to assess value-for-money and how beneficial it has been.

Newcastle - £20m - announced October 2021

The funding will go towards the regeneration of the Grainger Market and Old Eldon Square, in the city centre. Newcastle City Council says that, as of June 2023, £1.5m of the £20m has been spent. 

Newcastle's Grainger Market Credit: ITV News

Stockton South - £20m - announced October 2021

Plans include improvements to Yarm high street and new cycle infrastructure. Stockton Borough Council says external work to refurbish Yarm Town Hall is nearly completed, and other projects are in the early stages. The council told us there is a national completion target date of March 2025.

Sunderland - £20m - announced October 2021

The funding will be spent on two housing developments, and a housing innovation and construction skills academy. Sunderland City Council says construction is underway on one of the projects, and all are due to be completed in 2025.

North East Combined Authority- £19.6m - announced January 2023

Plans include 52 new zero-emission buses, and 92 electric vehicle chargers. The North East Combined Authority (which brings together the councils in Gateshead, South Tyneside, Sunderland and County Durham) says the funding was awarded by the government subject to checks, which are taking longer than expected, meaning delivery partners have not yet been able to place firm orders with suppliers.

Tees Valley Combined Authority - £17.8m - announced January 2023

Nine routes of improved walking and cycling infrastructure are planned, aimed at helping people access jobs, training and education. Tees Valley Combined Authority says it has procured a firm to design the schemes, and set out a target for the projects to be complete by the end of March 2025, and they are on time and on schedule.

Catterick Garrison - £19m - announced January 2023

This funding will be spent on regenerating the town centre. North Yorkshire Council says the project is in the very early stages, designs have been drawn up and a planning application is due to be submitted soon. Work on the site will start next year and is due to be finished in 2025, with the deadline of June 2025 to use the funding.

Gateshead - £20m - announced January 2023

The funding will contribute towards the building of a new arena and exhibition centre on the Gateshead quayside. Work on site is due to start by the end of 2023, the conference centre is due to open in 2025, and the arena later. Gateshead Council told us inflation has seen costs increase, but it is working with the developer to find savings. The council says the overall scheme will create thousands of jobs and generate over £40m a year for the local economy, and it is confident it will be value for money.

Artists impression of The Sage, a new conference centre and arena being built on the Gateshead quayside. Credit: Gateshead Council

Hartlepool - £16.5m - announced January 2023

A new production village is being created for the screen industries. Hartlepool Borough Council says the project began in May 2023. The council told us the bid for funding was required to demonstrate value-for-money and significant benefits from the project.

Northumberland - £14.7m - announced January 2023

New cycling and pedestrian lanes are planned between Hexham and Bedlington, aimed at giving people better routes to work, transport hubs and tourist attractions. Northumberland County Council says this is in the planning phase.

Redcar & Cleveland - £20m - announced January 2023

This was a joint bid with Middlesbrough Council. Plans include a road scheme linking to new housing south of Middlesbrough town centre, and regeneration schemes in Guisborough town centre. Redcar & Cleveland Borough Council says the projects are at an early stage.

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