Lord Heseltine speaks on Teesside about ambitious plans to revive Tees Valley in wake of SSI collapse

At the forefront of the project is the clean-up and redevelopment of the former Redcar steel plant as well wide-ranging improvements to the transport network, and a drive to boost education and skills for developing industries.

Lord Heseltine speaks with Middlesbrough chairman Steve Gibson

While Darlington is earmarked to become the gateway to the Tees Valley with plans to invest in the railway station and road network in and around the town.

Lord Heseltine unveiled his vision for the future this morning with Northern Powerhouse Minister and Stockton South MP James Wharton by his side.

The independent 90-page report sets the former deputy Prime Minister’s ambition for the area as the newly created Tees Valley Combined Authority takes pole position to deliver the proposals designed to help the area out of Newcastle’s shadow.

And the announcement comes a day after a planning application was submitted for hundreds of homes, businesses and leisure facilities to be built at Durham Tees Valley Airport.

The task due to be completed as soon as possible is the establishment of the South Tees Development Corporation to oversee the scheme and bring the private and public sector together.

Six months ago Lord Heseltine was called in by the Government to reignite the industrial flame after the blast furnaces at SSI were switched off, leading to hundreds of steelworkers being thrown onto the slag heap.

Stockton MP James Wharton speaks with the media

The former Deputy Prime Minister, lauded for the redevelopment work he delivered in the wake of the Toxteth riots in 1981 Liverpool, has now compiled a 90-page document outlining his ideas for the future of Tees Valley.

Focusing on creating jobs and generating wealth, the Tory grandee, affectionately known as Tarzan, has made a series of recommendations and called on the five local authorities to work together to build on the area’s heritage and expertise to create a sustainable economic future.

Other recommendations in the independent report include: combining all business advice and support – currently offered by several local bodies – into one service; the combined authority becoming the source for ambitious, visible and determined leadership to transform education and skill; and the Government seriously investigating extending the Transpennine electrification scheme to include the Northallerton-to-Teesport line.

Lord Heseltine said: “Tees Valley has shown time and again that spirit and skill are the essential ingredients for a successful Northern Powerhouse.

"This area has flown the flag for Britain around the world for centuries, and is now looking to make its mark in sectors as diverse as advanced manufacturing, energy, chemicals and processing, digital and logistics.

“The region is ready as ever to deliver in a global marketplace and I set out today how we can support this admirable ambition for it to once again assert its character on the world stage.

"I have been impressed by the determination of local people to lead this opportunity, and am looking forward to seeing their ambitions realised and the economic benefits this will bring not just for the Tees Valley or Northern Powerhouse, but for the country as a whole.”

As part of his brief from Sajid Javid, the Secretary of State for the Department of Business, Innovation and Skills, the Tory Lord looked at what needed to be done to ensure that the Tees Valley develops its own strong identity and rebuilds its industrial heritage.

Northern Powerhouse Minister and Stockton South MP James Wharton said: “This Government is committed to rebalancing the economy by creating a Northern Powerhouse – the Tees Valley, with its great vitality of spirit, is a key part of that.

"The history and heritage of this area is well known, as it was the heartbeat of the first industrial revolution. I look forward to working with local leaders and colleagues across the government to ensure the full potential of this area is realised once again.”

Councillor Sue Jeffrey, the Labour leader of Redcar and Cleveland Borough Council and outgoing chairwoman of the Tees Valley Combined Authority, believes the report will help build on the industrial foundations that have been created over the decades.

She said: “Lord Heseltine has taken a step back from the day-to-day and looked at our progress and our potential at a time when the growth in our economy has been hit by the devastating blow of the SSI closure and other job losses.

“His findings confirm that our economic foundations are sound, our local capacity is strong and our plans for future success are well drawn.

"He also makes it clear that delivering sustainable growth and prosperity can only be done in partnership and with adequate support from Government. I look forward to working with local leaders in all sectors and with Government to ensure that we make the most of the opportunities provided by his report.”

Graeme Hetherington looks at key aspects of the proposals.

POLICY

The comprehensive report highlights that Tees Valley represents one of the most significant integrated industrial economies in the UK.

The area boasts England’s second largest port while producing 30 per cent of the UK’s process output and delivering £11.4b to the national economy, which shows the importance to the area to the government's coffers.

And Lord Heseltine wants the five local authorities – Darlington, Stockton, Middlesbrough, Hartlepool, and Redcar and Cleveland – to continue to pull together to help create 25,000 new jobs by 2022 to keep it at the heart of economic growth for the Tees Valley.

The creation of the Tees Valley Combined Authority is designed to give the area a louder voice and a united direction when it comes to using its devolved spending powers to achieve common goals.

The deal provides for the transfer of significant powers for employment and skills, transport, planning and investment from central government to the Tees Valley. It paves the way for further devolution over time and for the reform of public services to be led by Tees Valley.

Elections next year will lead to a new, directly elected Mayor of Tees Valley, who will act as Chairman to the Tees Valley Combined Authority, with the responsibility of driving the area forward.

DECLINE AND GROWTH

TO get a feel for the Tees Valley Lord Heseltine had to look at the decline and growth of the area before he could come up with any proposals to regenerate its finances.

With the closure of the SSI steelworks in Redcar being the catalyst for report, the decline of the traditional heavy industries, such as mining, steelmaking and ship building, was central to him discovering the root cause of the economic impact on the area.

One of the key findings was that the area traditionally relied on a small number of large employers, such as ICI, and the loss or decline of those business models has had a devastating effect on well-paid and permanent employment.

Now an ageing population and skills gap, is holding back the economic recovery of the Tees Valley as it attempts to move away from the manufacturing sector.

Promoting self employment and medium size businesses will be at the forefront of any schemes that are brought forward through the Tee Valley: Opportunity Unlimited proposals.

Weaknesses that were identified as part of the review was the dependence on short-term funding and grant funding; poor public transport infrastructure and a lack of ambition from many small companies in the area.

INDUSTRIAL

THE business, innovation and skills department is looking at the report as a way of ensuring that the thousands of people affected by the closure of the steel plant are not discard and forgotten about.

Creating the South Tees Development Corporation (SDC) is aimed at reinvigorating the local economy by working alongside Local Enterprise Partnerships to help small and medium sized businesses expand as well giving people wishing to start their own business a helping hand and financial support to get up and running.

With the decline of traditional heavy industry leaving thousands of people out of work and with nowhere else to go, diversifying the area's economy is on the agenda for the regeneration project.

The Redcar taskforce was set up last year to support the workers who lost their jobs with a government package worth up to £80m allocated to get the staff back into the employment market with new skills.

And the clean-up and redevelopment of the SSI site is one of the highest priorities in the coming months. As a result the government plans to hand over the day-to-day running of the complex to the SDC to ensure the security and safety on the site.

GROWTH

LEARNING new skills and developing new innovative businesses has been identified as an essential part in the regeneration jigsaw.

Working with local universities, one of the proposals set out in the report, is to consider whether technical based education provision in the form of either a University Technical College or Institute of Technology may help to address skill gaps and contribute to meeting future needs of business.

The report's author also believes the Chambers of Commerce should agree with the Local Enterprise Partnership a visit to one of the leading German cities in order to learn at first hand the scale and quality of the services on offer to German companies with which Tees Valley companies have to compete.

Developing the already successful digital sector will enable the Tees Valley to continue to grows its economy while moving away from the traditional heavy industries that dominated the area's jobs market.

Regenerating town centres and coastal areas is another way of attracting new businesses to affected areas, where inward investment is essential to stop the brain-drain from the area.

The investment would be designed to create new jobs and foster the entrepreneurial spirit that has always existed right across the Tees Valley.

EDUCATION

EDUCATION, employment and skills, appears to be the mantra throughout the report.

A key target is to improve the area's failing schools and ensure that young people are leaving education at 16 with a solid foundation to build on and learn the skills that are required to get them into the workforce.

The Regional Schools Commissioner will be brought in to work alongside the Tees Valley Education, Employment and Skills Board, to oversee a joined up approach between learning and transferring those skills into employment.

One initiative, is for the local authorities to continue to send out letters to leaders of underperforming primary and secondary schools, and the Combined Authority to play a role in agreeing all school intervention plans with governing bodies, through the board.

As part of the drive to improve results, Tees Valley has been earmarked for help from the National Teaching Service, which seeks to incentivise talented teachers and middle leaders to work in areas that are struggling to recruit and retain high quality teachers.

The Tees Valley LEP and Combined Authority will be encouraged to work with employers and schools to promote and increase the number of apprenticeships in the area and maximise the opportunities presented by the government’s apprenticeship reforms, including the levy.

ECONOMY

CARBON capture and storage (CCS) initiatives were high on the agenda just a couple of years ago, but the Government's shock decision to scrap a £1 billion project seemed to end that idea.

Chancellor George Osborne revealed last year that subsidies for CCS, which aims to seize and store CO2 emissions from coal-fired power plants and heavy industry before they enter the atmosphere, was being axed.

Now, the project has been brought to the forefront of regenerating the Tees Valley.

One of the report's recommendations is that the Tees Valley should continue to make progress on its potential energy, including heat, network schemes and encourage as many of the industrial companies located on the north and south sides of the Tees as feasible to join the CCS schemes.

Hartlepool Council is to be encouraged to undertake work to consider whether the proposed nuclear site would be suitable to host a Small Modular Reactor, to put the area at the forefront of nuclear research and development programmes.

And the controversial development of Underground Coal Gasification (UCG), better known as fracking, could also be central the future economic development of the Tees Valley.

The report's author does accept that UCG has not yet been tested in the country on a commercial scale and is not currently in operation anywhere in the UK.

HOUSING

AFFORDABLE and fuel efficient housing is what most thriving economies are based on, according to the report.

Having somewhere suitable for young professionals to call home is paramount to stopping people moving away from the Tees Valley.

And in a bid to address the problem, the report is urging Tees Valley local authorities to work in partnership with the Homes and Communities Agency to identify suitable sites for starter home development and fast-track the development for young first time buyers.

Aged Victorian housing stock sitting in seriously deprived areas can be found in all five of the area's local authorities but the idea is to increase home ownership throughout the Tees Valley through increasing the supply of cheap, affordable housing.

The Devolution Deal for the area should enable the Combined Authority to create an investment fund, through a 30-year initial allocation of funding for capital financing of at least £15 million a year, to help deliver the housing stock needed to stop the brain-drain away from the Tees Valley.

A key factor in the slow delivery of housing has been highlighted as the acquisition for development rather than with land availability, so the new powers for the elected mayor will allow the process to be speeded up.

TRANSPORT

ENSURING the region has better road, rail, sea and air links is regarded as key to its future success.

Lord Heseltine wants bolder plans than those already being proposed by the Government, so that for example, there are major improvements to the busy stretch of the A19 where it crosses the River Tees, rather than the current scheme which will widen it the A19 on the stretch from from Norton to Wynyard.

He notes that a lot of road investment in the North-East has taken place elsewhere, which will mean that by early 2017 the A1 will have been upgraded to motorway standard all the way to Newcastle. He proposes that busy roads across Tees Valley get similar attention.

The benefit of the HS2 high speed rail network will largely be felt in the Midlands, North West and South Yorkshire. The report calls on ministers to recognise the importance of Darlington Station as the key rail gateway for the Tees Valley and to investigate the need for the station redevelopment to be included in the Network Rail and Transport for the North plans, to accommodate train services, such as HS2.

In the case of Durham Tees Valley Airport the report says the Tees Valley Combined Authority should work with the airport owners to agree a "sustainable future for the site", including its scarcely used railway station.

CULTURE AND TOURISM

THE report is concerned that Tees Valley remains a well-kept secret, rather than a place that draws visitors and skilled workers from the UK and abroad.

It needs to move away from its image of a place that has for centuries been a world famous centre for heavy industry, and promote itself as a vibrant cultural hub which boasts stunning countryside and coastline that attracts a wide array of wildlife.

However, the report notes that tourism currently accounts for only 1 per cent of the wealth generated by the Tees Valley economy. Most visitors to the area are day trippers and spend only half of the national average per visitor spend. Though Tees Valley has gone a long way to reinventing itself as a place where people want to live, work and visit, more work remains to be done, Lord Heseltine says.

More needs to be made to promote the area's cultural assets, such as MIMA and Hartlepool’s Maritime Experience, and tackle an acute shortage of hotel accommodation.

Setting up a destination management organisation to help promote the area, and encouraging local interest in the competition for Tees Valley to become UK Capital of Culture in 2025, are among the report's ideas.