Why the North East devolution deal was signed - and why there's an intriguing selection battle ahead

Doing up town centres was meant to provide easy wins for the government's 'levelling up' agenda. 

But there was a lot of aggro again last week over how the Levelling Up Fund has been allocated, and high inflation has made it hard for many projects to get off the ground.

Today Michael Gove admitted to me "there hasn't been enough progress made yet" in tackling regional inequalities, blaming the Covid pandemic and the war in Ukraine.

One area though where he and his colleagues are making real headway is with devolution deals.

Six were agreed in 2022, including with York and North Yorkshire, plus the North East - where Mr Gove signed the deal with local leaders today.

It will bring together Northumberland, Newcastle and North Tyneside - which have been under the North of Tyne combined authority, with Gateshead, South Tyneside, Sunderland and County Durham - whose councils rejected the deal on offer in 2016.

There is now a certain sense of finishing the job, tidying up and also playing catch-up with other areas that have settled devolution deals - like the Tees Valley, where the work of mayor Ben Houchen continues to be championed by Conservative colleagues far and wide.

Nationally, Labour and the Tories seem in agreement over the merits of wider and deeper devolution.

As well as some powers over transport, skills and housing, an investment fund worth £1.4 billion over 30 years is promised to the new North East combined authority.

Gateshead Council leader Martin Gannon told me today it was "not a good deal", compared to the amount that has been cut from council budgets since 2010 - but also that "it will happen this time", because he and other local leaders recognise the mayoral model is where the action's at if you want proper funding and powers.

I wrote about it similarly last February, when this ambition for the North East was set out in the government's Levelling Up White Paper, though with County Durham then envisaged to be going it alone.

There has been some local debate over the decision of Durham County Council's leaders to sign up to this wider devolution deal, but otherwise things have been pretty uncontroversial.

A public consultation is now underway on the deal, with Mr Gove and local leaders denying today that it's just a token exercise.

The seven councils will then have to give final agreement, but already May 2024 has been earmarked for the first election of a North East mayor.

The current Northumbria Police & Crime Commissioner Kim McGuinness has confirmed she wants to be the Labour candidate, pitting herself against the North of Tyne Mayor Jamie Driscoll for the party's nomination.

He comes from the left of the party, winning as a Corbynite in 2019 when that label was more relevant.

She is more of a centrist and is likely to have the backing of Sir Keir Starmer.

Other candidates for other parties have not come forward yet but, with Labour the favourites to take the new position, it promises to be an intriguing selection battle.

On past form, there will probably be more twists and turns in the story of devolution in the North East.