NORTH-EAST business and development bosses have been challenged to emulate their “cocky” North-West counterparts by revving up the region’s ‘oomph factor’ to strengthen economic growth plans.

Lord Jim O’Neill has urged council leaders to reconsider the merits of devolved powers, saying a U-turn would add fresh dynamism to the Northern Powerhouse and “make the future better.”

Speaking exclusively to The Northern Echo, Lord O’Neill also said Brexit “is not the most important economic issue facing Britain”, citing worries over productivity, skills and how the country remains too London-centric.

Praising the impact of Tees Valley mayor Ben Houchen, who was elected last year, Lord O’Neill called on councils across Durham, Gateshead, Sunderland and South Tyneside, which previously stepped back from a deal focused on handing the areas greater spending and regeneration powers, to think again.

Pointing to plans for a North of Tyne agreement, involving Newcastle, North Tyneside and Northumberland councils, the former Commercial Secretary to the Treasury said now was not the time for scepticism.

He also moved to play down criticism the Northern Powerhouse focuses too heavily on the North-West and Yorkshire.

“What persuaded Whitehall that it was an interesting policy idea is that if you look 40 miles either side of Manchester, you have Sheffield, Leeds and Liverpool”, said Lord O’Neill, who is vice-chair of the Northern Powerhouse Partnership, which is led by former Chancellor George Osborne and made up of businesses, civic leaders and other organisations.

“In that radius you have eight million people and if you can get that area functioning as one, you are creating something big.

“Since the North-East is more geographically distant from the centre, people could sit around and think ‘what has this got to do with me?’

“Alternatively, business and council leaders can think ‘we are more distant from the centre than ideal, but we are going to make a very big push to be part of it.’

“The Northern Powerhouse is about having more ambition and what I call more oomph.

“The cocky Greater Manchester guys have it in spades but the North-East needs more of it.

“The North-East needs to be more robust”, he told the Echo.

“I found it very disappointing how Sunderland, Gateshead, Durham and South Shields walked away for no obvious reason, other than they were sceptical.

“If the council leaders really wanted to do something for their places and to make the future better, then they would have had more ambition.

“The North-East is good at a number of things, with financial technology just one example.

“Look what’s happening with Atom Bank, in Durham, and Virgin Money, in Newcastle.

“It is great too what Ben Houchen is doing in the Tees Valley.

“One way to look at a situation is to just accept it, but the more optimistic option is to do something that makes a positive difference.”

Lord O’Neill, a former Goldman Sachs chief economist who also chaired the Cities Growth Commission, highlighted a campaign to create a post-Brexit tariff-free trade hub on Teesside as a perfect example of such proactive action.

A motion to secure free port status has accrued much support, including cross-party political backing, with Conservative Middlesbrough south and east Cleveland MP Simon Clarke, Richmond counterpart Rishi Sunak and Labour’s Redcar MP Anna Turley all previously adding their voices to the campaign.

A further 50 companies and individuals have signed a letter from Mr Houchen to Chancellor Philip Hammond that championed the benefits of the move, which could see Teesport become a free port.

Such ports operate outside customs territory, meaning manufacturers can import and export goods without the burden of expensive duties, and supporters say a transition would help re-balance the national economy, create jobs and act as a foundation stone for the planned re-development of SSI UK’s former Redcar steelworks.

“It is excellent and a clear example of trying to make the best out of the opportunities that might come out of Brexit”, said Lord O’Neill, who warned Britain’s impending EU divorce must not overshadow other matters affecting its future.

He said: “As important as the Brexit issue is, I don’t believe it is the most important economic issue facing Britain.

“Removing ourselves from the single market and customs union, if that is to happen, would be a negative in my view.

“But our trade policy has not delivered.

“That, alongside challenges over skills and education and the imbalance caused by the dependence on London, are bigger issues for the country.”

Admitting he understands the frustrations of the business community over Brexit clarity, since “the Government is not abundantly clear on what it wants”, Lord O’Neill, however, warned companies not to use the situation as an easy way out because “there is an element of uncertainty about life and the future.”

“What would be much more helpful for businesses is if the Government had a clear, credible plan”, he said.

“However, until the Cabinet can thrash that out with the Prime Minister and come up with an idea that the EU is prepared to agree, then it is a fact that uncertainty will be there.”

Lord O’Neill also cited a recent Northern Powerhouse Partnership report on schools, which found evidence of a “significant” secondary educational divide between the North and South, saying he believes the introduction of ‘opportunity areas’ in the North-East could be a catalyst for improvement.

Laid out by Downing Street as a drive to increase attainment and boost opportunities for young people, Lord O’Neill said that while the North-East is, at present, not on the list of areas designated for extra support, it would “be really good” for the area if it was.

Lord O’Neill was speaking ahead of the Prosperity North-East conference, which he gave his support to.

Discussing how the region can prosper after the UK leaves the EU, the event, backed by Mr Houchen and organised in partnership between the Tees Valley Combined Authority, Teesside University and Prosperity UK, will draw upon the expertise and experience of the region’s business community.

Hosted by the university, Prosperity-North East will include speakers from a range of sectors, political figures and academics, including Teesside University chancellor and president of the Confederation of British Industry Paul Drechsler.

It will also present business leaders with an opportunity to take part in group discussions on subjects such as infrastructure, industrial strategy, skills and training, global trade and investment.

Mr Drechsler added: “The North-East has a track record of accomplishment in overcoming challenges and the capabilities for developing the best possible route to prosperity when the UK leaves the EU.

“This conference will demonstrate to senior Government officials and those from outside the region that the North-East has the energy, commitment and ideas to shape our economy and society for future generations.”

The conference takes place on Friday, March 16.

For more information and to register a place, click here