Tees Valley, labouring under a best value notice imposed by the government, has missed out on a share of £7bn Social and Affordable Homes Programme (SAHP) funding which is to be handed out to other strategic mayoral authorities in the north and Midlands.
While the North East, West Yorkshire, Greater Manchester, Liverpool, South Yorkshire and West Midlands are getting between £700mn and £1.8bn each from the Ministry of Housing, Communities and Local Government (MCHLG) – including £1.1bn for Mayor Kim McGuinness’s North East – Tees Valley has been offered nothing.
It’s not the first time Mayor Lord Ben Houchen’s Tees Valley Combined Authority (TVCA) has been snubbed by the government since an independent report into its handling of the Teesworks regeneration site in Redcar & Cleveland found that standards expected when handling public funds had not been met. And it may not be the last.
Publication of the independent review in January 2024 was followed in April this year by imposition of a best value notice on TVCA.
Meanwhile, unlike the other big mayoral combined authorities, TVCA failed last year to be awarded an integrated settlement, which would have given it greater freedom to decide how to spend its budget, It also missed out on an investment zone.
It is notable that before the concerns leading to the independent review and best value notice were raised, Tees Valley enjoyed similar funding benefits to those going to its peer combined authorities. In July 2022, for example, it received a city region sustainable transport settlement of £310mn, and it has continued to received transport funding. In June this year it was awarded £978mn over five years under the Transport for City Regions settlement.
In 2021 Tees Valley received £19.4mn from the Brownfield Housing Fund and has now been awarded another £6.1mn from a £150mn expansion of the Fund. But this is nowhere near its putative share of the £7bn going to other mayoral authorities from the SAHP. Although no explicit reason has been given for Tees Valley’s failure to win a share of this £7bn funding, it seems evident that its previous financial mismanagement, specifically of the Teesworks site, is the reason.
If so, and in spite of continuing transport funding, the people of Tees Valley are paying dearly for the Teesworks mismanagement, and in more ways than just economic development. And as the SAHP is planned to amount to £39bn by 2036 there is potential for Tees Valley to lose a lot more unless it can regain the government’s trust. It is apparent that it has not yet done so, in spite of replacing its three most senior officials earlier this year and adopting an Organisational Improvement Plan in June.
The MHCLG responded to questions from NEB but did not say why Tees Valley had not been awarded a share of the £7bn first tranche of the SAHP. It said all areas would benefit from the full £39bn ten-year programme. “Mayoral strategic authorities like TVCA should continue work with Homes England through their strategic place partnership to develop a strong pipeline of housing projects and bring their respective strengths and resources to bear to deliver for local people,” it said.
TVCA has been approached for a response.
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