UK Spring Budget 2024: 6 Positive Steps for the North East of England

The increased regional powers and additional £100m for the North East has led the region to welcome the spring budget.

The signals are positive for the North East built environment. From a sustainability perspective, there are six steps that serve to bolster the region’s economic resilience, improve public transport infrastructure, provide much needed investment in housing and public health, take positive steps to safeguard our natural environment and invest in our growing international reputation for renewable energy generation and storage.

The budget included a new Level 4 “trailblazer” devolution deal with the North East Mayoral Combined Authority (NEMCA), which will provide a package of new funding potentially worth over £100 million, including a new ‘growth zone’ to support the region’s growth ambitions. The deal builds upon previous commitments made in December 2022. Putting the North East on par with Greater Manchester and the West Midlands.

NEMCA will replace the existing North of Tyne Combined and North East Combined Authorities and involves seven councils: Durham and Northumberland County Council’s, Gateshead and South Tyneside Metropolitan Borough Councils, Newcastle and Sunderland City councils and North Tyneside Council. It will be established in May 2024 when a new Mayor will be elected.

The chief executive of the North East England Chamber of Commerce John McCabe, has described the trailblazer deal as “a massive boost for the region.”

The budget will support:

1. A £25m investment in Riverside Sunderland and creation of a growth zone. NEMCA and Sunderland City Centre ultimately intend to invest up to £120m towards the Crown Works Studios using the tools provided by the deal to unlock £450m of private funding. The studios will be among the largest in Europe with over 20 sound stages, enabling the North East to become a major hub for big budget productions. Attracting global productions worth £644m a year jobs and creating 8,450 jobs in the region as well as £336m of economic growth (GVA) per year upon completion of all stages of construction and utilised at full capacity. The Crown Work Studios has been described as the most economically significant development for the North East since the arrival of Nissan in the 1980s.
   
   
2. £10m for a health innovation zone in Newcastle including developments at the Forth Yards and the Newcastle University's Health Innovation Neighbourhood on the city’s former general hospital site. Prof Jane Robinson, pro-vice-chancellor of Newcastle University’s Engagement and Place, said the funding will pay for "time critical works" in the regeneration of the former hospital site in the West End. The Health Innovation Neighbourhood (HIN) builds on our world-leading expertise in healthy ageing and will be the first of its kind in the UK, tackling major health and social challenges with the aim of identifying solutions that will benefit people here in the North East and beyond. Our long-term development will include housing, green spaces, healthcare, commercial spaces, and educational facilities that will sit alongside important research and innovation projects".
   
   
3. £58.4m earmarked for transport improvements, the maintenance and renewal of the Tyne and Wear Metro system between between 2025 and 2027 along with the formation of a rail board to develop the plans.
   
   
4. The creation of a coastal and rural taskforce to “strengthen quality of life, biodiversity and the natural environment”.
   
   
5. From 2026, in partnership with Homes England, NEMCA will be able to set the overall strategic direction of the region's Affordable Housing Programme; creating a single funding pot for housing and regeneration, as a precursor to a future departmental-style funding settlement.
   
   
6. The Treasury also confirmed further details of a new “investment zone” in the North East, to support new investment and innovation in electric vehicle manufacturing, battery production, offshore wind and low-carbon materials. Offering businesses tax incentives at Blyth Energy Central in Northumberland and the International Advanced Manufacturing Strategic Site in Sunderland and South Tyneside, plus a £20 million investment fund set up to help create jobs on the banks of the Tyne and at the NETPark in Durham. Predicting the zone will leverage at least £3 billion of investment and create more than 4,000 jobs over the next 10 years.

The seven council leaders said it was “excellent news”. They added, “From enabling investment for Crown Works Studios to securing essential transport funding to a taskforce to tackle rural and coastal issues, this is a deal we have custom made for the North East.”

Director of the Institute for Public Policy Research North think-tank, Zoe Billingham, described the devolution deals as ‘modest steps forward’ and John McCabe joined some North East Labour politicians in expressing simultaneous concern about cuts in public services: “While there was some very significant good news for the North East in this budget, we are very concerned about the further cuts to a wide range of public services”.

Initial responses are positive, but it is clear there are still significant opportunities for further devolution which would see more joined up powers over the coming years. Hopefully alongside more joined up long term planning around environmental, economic and social health that can be used to measure and evidence our progress as region.