Teesworks: Accountability and Scrutiny

Kevin Hollinrake Excerpts

Wednesday 7th June 2023 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

It is absolutely right that this place offers right hon. and hon. Members the opportunity to raise concerns about value for money or process, particularly when it comes to public money, so I am grateful for the contributions from both sides of the House, and in particular from so many fellow northern Members. Indeed, as a Back Bencher, I have on a number of occasions used the privilege that this House offers to raise concerns about other alleged wrongdoings, but I think it important that we consider our language, our tone and the content and context of the claims that are made. I think that it is wrong to exonerate someone without due process, as it is to condemn somebody without due process.

In the case of the South Tees Development Corporation and Teesworks joint venture, it remains the case that the Government have seen no evidence of corruption, wrongdoing or illegality. Neither have the auditors of the STDC, nor have my hon. Friend the Member for Stockton South (Matt Vickers) or the hon. Member for West Lancashire (Ashley Dalton). However, the seriousness of the allegations, some of which have been made in the House and discussed today, could damage public trust, so it is right that they are investigated.

It is important to recognise that the review that we have commissioned was called for not only by Members of this House but by the Tees Valley Mayor himself. Our elected Mayors play an important part in championing their areas—convening communities, local leaders, businesses and investors to support levelling up in those places. As my right hon. Friend the Member for Scarborough and Whitby (Sir Robert Goodwill) and my hon. Friend the Member for Sedgefield (Paul Howell) highlighted, industry on Teesside was in decline prior to Mayor Houchen taking office. The project has the potential to deliver more than 40,000 jobs and billions of pounds of economic growth.

The Mayor has understandably raised concerns about the allegations made, recognising the damaging effects they could have on investments and job creation across the Tees Valley. That was a point raised by the hon. Member for Sunderland Central (Julie Elliott). The continued allegation of corruption poses a real risk to our shared ambitions to deliver jobs and economic growth in Teesside. My hon. Friend the Member for Hartlepool (Jill Mortimer) rightly stated that those concerns and allegations—unfounded at this point in time—deter investment in the region, a point also made by my right hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke). As he said in his final words, we have had enough of talking down the region.

The hon. Member for Middlesbrough (Andy McDonald) said that people did not need to rely on his comments about the allegations being raised, citing newspapers that had raised them. But he must be aware that the Financial Times makes no allegations of wrongdoing, but merely quotes his comments made in this House. That is similar to the points made by the hon. Members for Wansbeck (Ian Lavery) and for Warwick and Leamington (Matt Western). They raised facts, but they made no direct allegations as the hon. Member for Middlesbrough did. Those allegations are an ongoing concern, shared by the Secretary of State for Levelling Up, Housing and Communities, my right hon. Friend the Member for Surrey Heath (Michael Gove) and me. That is why my right hon. Friend has announced the independent review, which will address the accusations directly and robustly.

As the Under-Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for North East Derbyshire (Lee Rowley) confirmed earlier in the debate, the Department for Levelling Up, Housing and Communities has also now published full details on the review, including the independent panel that will lead the review and the terms of reference. I can assure hon. Members that, in line with existing practice, the Government have appointed a panel composed of external, independent experts with extensive experience at senior levels.

As the lead reviewer, Angie Ridgewell brings extensive experience of senior leadership in local government. She is the current chief executive at Lancashire County Council, having previously held senior roles across the public sector, including as director-general of two Departments. Richard Paver and Quentin Baker have been appointed to ensure the panel are fully equipped to consider the complex legal, financial and commercial matters the review is likely to cover. Richard Paver acts as the finance lead for an existing non-statutory intervention at Wirral Council. Quentin Baker is currently director of law and governance at Hertfordshire County Council and has 17 years of experience acting as statutory monitoring officer for several large local authorities.

The shadow Secretary of State raised concerns about the extent of the review and I understand that, given the time that she had to study the announcement. But she was not right to say that the review relates only to general governance, because it clearly specifically refers to allegations that have been raised, and the inquiry needs to respond on those issues, including commercial arrangements.

Members have raised the question of the prospective role of the National Audit Office. The Government considered carefully calls for an investigation to be led by the NAO. It is not, however, the NAO’s role to audit or examine individual local government bodies, and its powers would not normally be used for that purpose. It would not be appropriate to expand so significantly the role of the NAO by asking it to lead this inquiry. In confirming the review, the Government have been clear that we would welcome any action by the NAO to update its review of Government funding arrangements. These are all points that were raised by the hon. Members for Sunderland Central, for Washington and Sunderland West (Mrs Hodgson) and for Stockton North (Alex Cunningham), as well as by the shadow Minister, the hon. Member for Nottingham North (Alex Norris), who described that position as eccentric despite the fact that it is the established process—a process that Labour actually established.

It is important in this debate that we do not lose sight of the value of devolution in empowering our local communities. Mayoral development corporations are but one tool at the disposal of our elected Mayors to support renewal and regeneration where it is much needed—in places such as Redcar and Cleveland, Middlesbrough and Hartlepool, where the challenges of post-industrial deprivation are significant but the opportunities are equally so. Local and regional government working together with the private sector is an opportunity to provide the leadership and strategic direction needed to enable growth.

Equally, this Government have been clear about the importance of accountability and scrutiny for areas with devolved powers. The English devolution accountability framework, published this March by the Department for Levelling Up, Housing and Communities, sets out the ways in which we expect mayoral combined authorities to make themselves accountable to both the public and Government. The forthcoming scrutiny protocol will set out how we expect such bodies to create a sustained culture of scrutiny.

Once again, I thank Members for their important contributions today. We should be focused on ensuring the best outcomes for the Tees valley, so this is an important debate to have. Only a few years ago, the Teesworks site was a burden to the taxpayer and a danger to the public, with a significant price tag merely to maintain its safety and security. We should not lose sight of the fact that investments in that site—public and private—are helping meet our net zero targets, while providing economic opportunity and a sense of prosperity for future generations.

Question put.