Public money totalling £7,000 was spent by Ben Houchen’s Tees Valley Combined Authority on legal advice from a top libel lawyer after allegations of corrupt deals at the Teesworks industrial complex - claims which have been vehemently denied.
The Times newspaper said the sum was spent with London-based media law firm Carter Ruck, which specialises in defamation cases, with a spokesman for the authority telling the newspaper it had sought advice on taking legal action against Middlesbrough MP Andy McDonald and the satirical magazine Private Eye.
Labour MP Mr McDonald, citing a Private Eye article, used Parliamentary privilege in April to allege “industrial scale corruption” relating to the Teesworks development.
Private Eye has published a number of reports on the development, Mr Houchen – now Lord Houchen of High Leven – and two local developers Chris Musgrave and Martin Corney who have a majority shareholding in the taxpayer funded site under a joint venture arrangement.
Read more: Panel to investigate allegations of corruption at Teesworks is named
Mr Houchen along with Mr Musgrave and Mr Corney, have denied any wrongdoing, An investigation into Teesworks is currently underway after Mr Houchen and Labour’s Shadow Levelling Up Secretary Lisa Nandy both called for a probe.
The three-person panel will consider allegations of corruption, illegality and wrongdoing, alongside governance and financial management. The government has previously stated it has seen no evidence of corruption, wrongdoing or illegality.
A spokesman for Mr Houchen told the Local Democracy Reporting Service that Mr Houchen himself did not instruct lawyers, nor did he have any power to do so.
He said the advice was sought by TVCA officers to assess the legal position on its behalf following “untrue and defamatory allegations made against it” and its subsidiaries.
Meanwhile, Mr McDonald, he said, had repeatedly refused to repeat his accusations while not covered by Parliamentary privilege, citing a Radio 4 interview in which he was pressed about the matter earlier this year.
Mr Houchen has suggested that negative headlines surrounding Teesworks has driven away some potential investors in Teesworks – once home to the former Redcar steelworks before its demolition – citing the company Atlantic SuperConnector which planned to build a cable factory at a coastal location in the North-East so renewable energy from thermal waters could be carried from Iceland to the UK.
Mr Houchen said: “Andy McDonald has made allegations of criminality and corruption in Parliament, but refuses to repeat those claims outside of Parliament where he can be sued.”
He said Mr McDonald’s remarks had cost Teesside the opportunity to land Atlantic Superconnector which would have brought “hundreds of millions of pounds and 2,000 jobs to our area”.
Mr McDonald said the legal advice sought had been a “waste of public money”. He said: “I’ve received no [legal] letter forewarning of action and don’t expect one because it is as plain as a pikestaff there isn’t a cause.”
The MP said he understood Atlantic Superconnector had made a decision to locate to the Port of Tyne, but had not explained its rationale.
He said: “People don’t make decisions on the basis of what might be said by one MP at any particular time, they will carry out their own due diligence and carry out their own enquiries.”
Mr McDonald added: “Parliamentary privilege is there for a reason, otherwise we’d get part of our democracy closed down. We are pretty familiar with strategic lawsuits against public participation whereby people are brought within litigation for the precise purposes of silencing them.
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“Freedom of speech is a valuable commodity in our democracy and we undermine this and other values at our peril.”
Ian Hislop, the editor of Private Eye, said the £7,000 bill was an “interesting use of public money earmarked for the regeneration of Teesside”.
He said: “Good to see Lord Houchen supporting one of the most deprived sectors in Britain — London libel lawyers.”
A TVCA spokesman said: “The decision to seek legal advice was made following a series of articles by Private Eye and comments made by Middlesbrough MP Andy McDonald.
"False and unfounded allegations of misconduct and impropriety have been made against South Tees Development Corporation and its joint venture partner Teesworks Ltd.”
He said the success of the project “risked being seriously overshadowed by the allegations, which are having a significant and worrying impact on investor confidence”, adding: “We are responsible for driving economic growth in our area and therefore it is essential we protect the reputation of major projects — and those leading them — from unfounded allegations.”
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