Michael Gove has ordered an independent review into Teesworks, the North East regeneration site that is the UK’s largest freeport.
The 4,500-acre scheme, which is overseen by Tees Valley mayor Ben Houchen, has faced allegations of cronyism, lack of transparency and poor value for money.
The levelling up secretary had been called on by his opposition shadow, Lisa Nandy, to launch an inquiry into the allegations, which centred on Conservative mayor Houchen. Houchen has himself called for an inquiry to prove that there has been no wrongdoing.
In a letter from Gove to Houchen, the levelling up secretary said he was not obliged to look into the allegations, but “given the importance to you and to Teesside of addressing this matter, I have taken the exceptional decision to support the commissioning of an independent review to consider the specific allegations made and Tees Valley Combined Authority’s oversight of the STDC and Teesworks joint venture”.
He insisted that “this is not because I am advised that there is evidence to recommend such a review, but to answer [Houchen’s] request”.
He added: “Since serious allegations of corruption, wrongdoing and illegality have been made, I will ask the panel to address these accusations directly, and to report on the governance arrangements at STDC including how decisions are made, as well as looking at the value achieved for the investment of public money on the site.”
He stopped short of ordering the National Audit Office to investigate, which can only inspect local bodies at the request of a minister. “I do not think it would be appropriate to expand so significantly the role of the NAO by asking them to lead this inquiry.”
The independent review will be made up of a panel of experts, to be appointed by Gove on terms that he will publish shortly. It will examine both the specific allegations levelled at the project and more broadly at governance, decision-making processes and value to the taxpayer.
Gove said the review will also look at the oversight of the project provided by STDC and the Tees Valley Combined Authority of five local councils, which is also chaired by Houchen.
However, he insisted that it was “still the case” that there had been “no evidence of corruption, wrongdoing or illegality”.
The Teeside scheme has so far received £200m from the taxpayer and is one of the government’s flagship levelling up projects.
Between 2020 and 2021, 90% of the shares in the scheme were transferred to two local developers.
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