Teesworks: Accountability and Scrutiny

Ashley Dalton Excerpts

Wednesday 7th June 2023 Commons Chamber

[Ashley Dalton (West Lancashire) (Lab)]

In autumn 2021, the Secretary of State for Levelling Up, Housing and Communities, on a visit to Teesside, said:

“If you want to see what levelling up looks like, come to Teesside.”

So let us have a look. Hundreds of millions of pounds of taxpayers’ money has been invested to bring forward local regeneration and jobs creation. The Tees Valley Mayor says that £2 billion of private sector investment has been leveraged and that almost 3,000 jobs have been created. What we do not yet know is how the joint venture partners in Teesworks were selected, why they were selected, and how or if any other potential joint venture partners had the chance to express an interest in being selected.

What outputs projects may have delivered is not the subject of this debate. What matters here is whether this is value for money, who is benefiting and how. It seems to have gone quite well for the joint venture partners. In the space of a few years, they have gone from having a 50% stake in the company to having a 90% stake. According to the Financial Times, they have also received £45 million in dividends and, as far as we can tell, they have not had to invest any of their own money in the project yet. The initial share transfer of 50% took place without any public tender process; the decision to transfer a further 40% stake also took place without any public tender process.

None of that is sure-fire evidence of anything untoward having happened. However, although we cannot demonstrate that anything untoward has taken place, there is inadequate transparency and accountability to give the people of Teesside, and taxpayers across the country, any confidence whatever that their money and their assets have not been inappropriately or unfairly spent.

I spent 25 years as an officer in local government and it was impossible to buy a ream of paper without a transparently awarded procurement framework, never mind appoint regeneration partners and transfer public assets worth millions of pounds. In my personal experience, the procurement and partnership rules in local government, and the need for open and transparent public tender processes and procedures, often draw groans of frustration from officers. However, it is also my personal experience that local government officers are acutely aware of the responsibility upon them not only to spend public money appropriately, but to be explicitly seen to do so.

Arguably, Teesside is the Government’s beacon of levelling up. South Tees Development Corporation was the first ever mayoral development corporation to be set up outside London. More recently, the Tees Valley Mayor has been entrusted with another new development corporation, in Hartlepool, and, despite opposition from Middlesbrough Council, a new development corporation in Middlesbrough. So can we take it that the Secretary of State has confidence in the ability of the Tees Valley Mayor to set up and work with mayoral development corporations?

[Mr Simon Clarke]

On that point—

[Hon. Members]

No.

[Ashley Dalton]

I will give way. Go on—I am intrigued.

[Mr Clarke]

I am grateful to the hon . Lady for giving way because it has been reported this afternoon that the Middlesbrough Labour party is pulling the rug from under the Middlesbrough Development Corporation, which was established just a few weeks ago. Can she explain why that is the case and why it is forgoing the £18 million of Government support that that would bring, as well as the private sector support it would unlock? That seems to be a profoundly retrograde step for my town.

[Ashley Dalton]

It seems that quite a few of us believe that we should be looking far more into a wide range of these development corporations.

[Andy McDonald]

I am grateful to my hon. Friend for giving way on that point. Is she aware that the position of Middlesbrough Council was to say, “Give us the money, don’t give it to yet another self-appointed board under the tutelage of Ben Houchen”? Is she as amazed as I am that Ben Houchen has deliberately excluded PD Ports, the biggest employer and investor in the territory, from the consultation process? Does she not find that ridiculous?

[Mr Deputy Speaker (Mr Nigel Evans)]

Just before the hon. Lady responds, let me remind her that there is one more speaker to get in before 6.40 pm.

[Ashley Dalton]

Thank you, Mr Deputy Speaker. I thank my hon. Friend for his intervention. What he has added enlightens us all and adds a lot to this debate.

As I have said, the current Tees Valley Mayor is apparently trusted deeply by the Secretary of State to work with mayoral development corporations, so why does the Secretary of State reject the Mayor’s request for a National Audit Office inquiry in favour of a panel, handpicked by the Secretary of State, with a remit, scope and authority hurriedly thrashed out fewer than 10 minutes before this debate began and which, by the sound of it, is not approaching adequate?

I am a member of the Public Accounts Committee and cannot speak highly enough of the National Audit Office. Perhaps the NAO has indicated that it could not, or should not undertake an inquiry into Teesworks. But not so: the NAO has said that it is able and willing to undertake such an inquiry. We can assume then that the NAO sees no problem with it being tasked to do so, from the perspective of its remit, its expertise or its capacity.

[Several hon. Members rose—]

[Ashley Dalton]

I will not give way as I am nearly done.

When it comes to the spending of public money and the transfer of public assets into private ownership, it is not just the decisions made that cause concern among communities; it is also when those decisions appear to be made in the dark behind closed doors and without transparency. That is when people start to feel suspicious.

Therefore, to help me, others on the Labour Benches and the people of Teesside understand the Secretary of State’s decision to reject the request of the Tees Valley Mayor, to decline the offer of the NAO and to set up a new panel from scratch, I invite the Secretary of State, assuming he is listening, to share his thinking, take the lid off decision making in Teesside and show the taxpayers of this country the respect and courtesy of an independent transparent inquiry that they can trust.

[Mr Deputy Speaker (Mr Nigel Evans)]

I call Matt Western and ask him to resume his seat at 6.40 pm.