THE Tees Valley is celebrating today after a scheme to encourage new business investment, and expected to create about 3,000 jobs, was given the go-ahead by the Government.

Plans for an enterprise zone spread over 12 sites on both banks of the Tees estuary – where companies will enjoy tax breaks and fast-track planning rules – have been approved by ministers.

It is hoped the zone will attract about 160 businesses and create almost 3,000 jobs by the time of the next General Election, in 2015, primarily in petrochemicals and renewable energy.

Last night, David Cameron hailed the announcement – 14 zones will be unveiled today – as proof that his government is doing “everything we can to make Britain the best place in the world to start and grow a business”.

He added: “Enterprise zones are a major step towards delivering this – cutting business taxes, easing planning restrictions and giving businesses the tools they need to invest and expand.

“These new enterprise zones will be trailblazers for growth, jobs and prosperity throughout the country.”

A second zone is being confirmed for the North-East today, mainly straddling the Tyne, in Newcastle, but also including Washington.

The key benefit for firms moving into an enterprise zone is that they will pay no business rates for five years, up to a cap of £275,000.

In addition, all business rates growth within the zone will be retained by Tees Valley councils for 25 years to spend on economic priorities, instead of lost to a central Treasury fund. In addition, a local development order (LDO) will mean nearly all planning applications will no longer need the go-ahead from local councillors, removing the right of the public to lodge objections.

When Tees Valley Unlimited (TVU), the area’s local enterprise partnership (LEP), put in a bid for a zone spread over many sites – instead of concentrated on a single location – it said it faced a huge task to win approval.

But today’s announcement gives TVU most of what it asked for, including: 􀁥 An initial zone based around four key sites for the petro-chemical, renewable energy, advanced engineering and digital industries – Queen’s Meadow, in Hartlepool, Kirkleatham, in Redcar, South West Iron Masters in Middlesbrough and Belasis Hall Technology Park, in Stockton; 􀁥 Business rate retention will extend the zone to four further sites – Darlington Central Park, Oakesway, in Hartlepool, Northshore, in Stockton and St Hilda’s, in Middlesbrough; 􀁥 The costs of plant and machinery will be written off against taxable income at four sites – Wilton and PD Ports/South Bank Wharf, both in Redcar, Port Estates, in Hartlepool, and the New Energy and Technology Park, in Billingham.

The go-ahead was welcomed by business and political leaders as a step forward in the region’s fight against the economic downturn and rising unemployment.

James Ramsbotham, chief executive of the North East Chamber of Commerce, said: “Businesses in the Tees Valley require a sophisticated package of support to promote investment and it is welcome that this has been acknowledged.”

Darlington Borough Council leader Bill Dixon said: “I am delighted that our combined efforts have reaped rewards across the Tees Valley.”

Middlesbrough Mayor Ray Mallon said: “These innovative proposals will help to build on the area’s economic strengths and give a muchneeded boost to the private sector at a time when the public sector is facing major cuts.”

An echo of Margaret Thatcher’s flagship scheme to reverse urban decay, the Tees Valley was picked for one of the first ten enterprise zones in the March Budget.

However, critics said the policy failed to deliver in the Eighties and Nineties, moving jobs around rather than creating them, and that the £5m of tax breaks on offer for each zone was far too little.