The independent Tees Valley Review, commissioned by Michael Gove (then Secretary of State for Levelling Up, Housing and Communities (DLUHC)) reported in February with 28 recommendations for improvement at Mayor Ben Houchen’s Tees Valley Combined Authority (TVCA) and its subsidiary South Tees Development Corporation (STDC).
The Review was commissioned in response to public suspicions of incompetence and corruption at Teesworks, the highly polluted former steelworks land at Redcar.
The regeneration has so far gobbled up over half a billion pounds of public money, with the only beneficiaries to date being a consortium of four local businessmen, led by residential property developers Chris Musgrave and Martin Corney. They were gifted 90% of Teesworks Ltd, the joint venture tasked with overseeing the project, with STDC holding the remaining 10%.
The end of this month marks the deadline for TVCA’s action plan and progress report in response to the Review’s recommendations.
The TVCA draft response comprises over 800 pages and includes reports from independent experts, often less than complimentary.
Peter Morris, former news editor at the Middlesbrough Evening Gazette, has taken a toothcomb to the documents itemising the list of failings that have led to the controversy about Teesworks and associated public sector bodies.
Before the response finds its way into the inbox of central government, it must be approved by a string of committees at the TVCA and STDC. This should be a chance for backbench councillors across Tees Valley (Middlesbrough, Stockton, Redcar and Cleveland, Hartlepool and Darlington) to scrutinise the TVCA’s actions.
Rubber-stamping?
But instead the process threatens to be a rubber-stamping exercise, with elected representatives shepherded by the statutory officers.
First off the block was the TVCA’s Oversight and Scrutiny Committee (OSC), which met on Wednesday (4 September) at Teesside International Airport.
Much of the discussion, with shared microphones and planes overhead, was inaudible to the public gallery at the back of the room. The gallery contained only three non- officials: North East Bylines’ Ray Casey and two other reporters.
Councillor Ian Haszeldine asked that consideration of the response be rescheduled to give members time to read the 800+ page tome. His request was voted down.
To show who’s boss, a TVCA official gave the councillors a ticking off – for leaking the draft response file and for criticising the work of the TVCA and its development corporations.
When councillors suggested more scrutiny of Teesworks Ltd, the answer from statutory officers Emma Simson and Gary Macdonald was swift, final and wrong. They claimed that the OCS could scrutinise STDC but not Teesworks Ltd, as the latter is a commercial entity.
Their assertion echoes an earlier long-held claim that the OSC committee has no right to supervise the STDC. That was wrong too, as is detailed in Peter Morris’s article.
As minority shareholders in Teesworks Ltd, the STDC has the right of access to various financial documents of Teesworks Ltd but that barely goes beyond the publicly available and free downloads from Companies House.
However, the STDC and by extension its parent TVCA could retrieve far more information via the TVCA Chief Executive, Julie Gilhespie.
Gilhespie is also a Director of Teesworks Ltd. In that role she is legally bound to safeguard the interests of the company. She is also entitled to access all the company’s accounting books under Section 388(1)(b) of the Companies Act 2006s. She can in addition view other records in order to fulfil her safeguarding duties as director.
Gilhespie is also a company director of Steel River Energy Ltd (ultimate owners Corney and Musgrave), and Teesside International Airport Business Park Ltd (ultimate owners TVCA, Corney and Musgrave).
If Gilhespie declines to access those company records on behalf of TVCA, she could be looking at accusations of conflict of interest.
Gilhespie has the power to call up Teesworks Ltd papers to scrutinise its £40mn marketing costs, or the contractual arrangements that made Corney’s son-in-law in charge of lucrative scrap removal at the Teesworks site.
Gilhespie was not at the OSC meeting.
As with the STDC Audit and Governance Committee meeting the following day, the draft response was voted through.
More questions have been raised by concerned members of the public who have tabled 62 questions. The TVCA officials have a fortnight to respond.
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