Teesworks will increase jobs, wages and productivity, and likely reduce deprivation and improve health and education in the Tees Valley area over the next few years, provided business confidence in the project is not undermined, Tees Valley Combined Authority’s (TVCA’S) Cabinet will be told on Friday.
The regeneration project is anticipated to create 20,452 jobs in operations, construction and supply chains, on the basis of existing formal commitments and initial agreements, according to an economic impact assessment (EIA).
Teesworks is anticipating an average annual salary of £40,00 or £769 a week, compared with the current £570 for the TVCA area and £542 for Redcar & Cleveland (R&C), says the EIA. The UK average weekly wage is £666.
Productivity in R&C, measured by gross value added (GVA) per employment job, currently 18% below UK average in TVCA and 27% below in R&C, where it is the lowest in the UK, is likely to rise by about 17%, the report says.
There is reason to believe, according to the report, that when the government updates its indices of multiple deprivation next year, some improvement may be seen in the local statistics, which are among the worst in the UK. Inflection points may become evident, as the report puts it.
“This is especially true of employment, education and incomes. Should these indicators continue to improve then health indicators may follow, given their close correlation with education and incomes.”
Iin addition to these and other local and regional benefits, there will be national strategic benefits in the areas of green electricity, carbon capture and new technologies.
Warning
The report ascribes these benefits to the public/private partnership at Teesworks between South Tees Development Corporation (STDC), chaired by Tees Valley Mayor Lord Ben Houchen, and its joint venture (JV) partners, businessmen Chris Musgrave and Martin Corney. It warns against upsetting this arrangement, which has proved controversial as reported by North East Bylines on numerous occasions.
The report describes the practical efforts of private interests, especially DCS Industrial (a company of which the JV partners are directors) as “crucial.”
There are also repeated warnings for the government: “Given the government’s commitment to the net zero path and, above all, the pursuit of sustainable public finance through green economic growth,” says the EIA, “any uncertainties about the Teesworks project that may act to undermine investor confidence means that these national strategic and local aspirations hang in the balance”.
Driving the point home, it adds that the Budget on 30 October “will be watched carefully by investors and business operators for signs of greater regulatory certainty – a crucial ingredient of investment and business planning. In the interim, regulatory concerns related specifically to Teesworks and the TVCA continue to weigh on sentiment at a time when a great deal of progress is potentially imminent.”
Who wrote the report?
The economic impact assessment was commissioned by Teesworks Ltd, 90% owned by JV partners Musgrave and Corney, and written by Dr Walter Boettcher, head of research and economics at Colliers UK, which describes itself on its website as “London West End commercial property agents and real estate services.”
Dr Boettcher is said in the EIA to have 25 years’ experience in UK commercial real estate, property economics and analytics for leading London West End agencies. He has degrees from the University of Texas in Austin and UCL London. He has worked in both these places, including in environmental engineering for the City of Austin and experience in the Gulf of Mexico oil and gas sector.
*The EIA discussed here is the same as that mentioned by North East Bylines on 22 September but said to be not included in the TVCA Cabinet papers. In fact, it is included in the Cabinet papers, at pages 792-812. Apologies for that error.
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