The controversial regeneration of Teesside Steelworks
The development has descended into polarised political controversy with allegations of cronyism and backroom deals
Teesside is at the centre of a growing political row between Labour and Conservatives over the regeneration of a former steelworks site.
The Teesworks project is the renovation of the largest brownfield site in Europe – 4,500 acres near Middlesbrough in northeast England. It has been seen as a major part of the Conservative government’s levelling up agenda, but has been marred in recent months by allegations of “cronyism and backroom deals”, Sky News reported.
What is the regeneration process?
The Teesworks project has been touted by the government as an ambitious plan to transform a former industrial site into a net zero manufacturing hub as part of the government’s pledge to create up to ten freeports around the UK.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
After the old steelworks closed in 2015 – leaving “a toxic wasteland” that is “the size of Gibraltar”, said The Telegraph – £250 million in government grants was made available to rejuvenate the site. “Thereafter the private sector would step in,” said the paper.
Work has begun on a new factory on the site in which South Korean firm SeAH will manufacture offshore wind turbine monopiles. The £450 million project is expected to create 750 jobs at the site. But, said The Telegraph, “the problem was and remains that until a colossal cleanup is completed, the entire development is effectively worthless”. That “cleanup” will cost an estimated £500 million, according to a report seen by The Telegraph.
What are the allegations?
Ben Houchen, the Conservative mayor of Tees Valley, has overseen the regeneration project in his capacity as chair of the South Tees Development Corporation. But Houchen, 36, a rising star of the Tory party, has come in for criticism over the way the public-private partnership he promised has panned out.
“The mayor’s political opponents have accused him of cronyism,” said the Financial Times, “after a 90 per cent stake in the company operating the vacant steel site was transferred to two local developers… without any public tender process”.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Companies owned by the two developers, Chris Musgrave and Martin Corney, “have earned at least £45mn in dividends from the project in the past three years”, said the FT. But “there is no evidence they have invested in it to date”.
According to The Yorkshire Post, Musgrave and Corney not only profit from lease agreements, they “also get half the money made from scrap metal sale – more than £93m so far”.
What has the Labour Party said?
Shadow Levelling Up Secretary Lisa Nandy has called for an official inquiry by the National Audit Office (NAO) to answer “important questions about the transfer of a vital public asset into private ownership”, said Sky News.
And fellow Labour MP Meg Hillier, who chairs the Public Accounts Committee, urged Levelling Up Secretary Michael Gove to order an investigation, telling the FT “that the existing financial oversight system for England’s directly elected mayors was not ‘robust’”.
However, the matter reached a head when Labour MP for Middlesbrough Andy McDonald used parliamentary privilege in the House of Commons to allege “truly shocking, industrial-scale corruption” within the regeneration project.
A Teesworks spokesperson told Teesside Live that McDonald should contact the police if he believed offences had been committed.
What has the Conservative Party said?
Houchen strongly refuted the allegations of “sweetheart deals” and hit hit back at McDonald’s comments in Parliament, “daring the Labour MP to repeat his claims in public and face being sued for defamation”, reported the Express.
Speaking to BBC Newsnight, Houchen argued the Labour Party has manufactured the row, maintaining it is “embarrassed” at the progress being made under the Tories in what is traditionally a Labour stronghold.
But while the mayor dismissed the criticism, he has now backed calls for a review, said LGC Plus, writing to the NAO to request a “full investigation” into the project. He describes this as an attempt to provide a “swift, decisive conclusion” in the interest of transparency.
His statements have been backed by Musgrave, one of the project’s developers, who said such a review would establish the truth of the matter “once and for all”.
Previously, the NAO has reviewed the business case for the taxpayer-funded project, but has been unable to commence a detailed audit without the process being approved by Gove, the secretary of state. This is because the project is being run by the Tees Valley Combined Authority, rather than central government.
The government has said it has seen “no evidence of corruption, wrongdoing or illegality” and is “carefully considering” requests for an NAO review.
Create an account with the same email registered to your subscription to unlock access.
Rebekah Evans joined The Week as newsletter editor in 2023 and has written on subjects ranging from Ukraine and Afghanistan to fast fashion and "brotox". She started her career at Reach plc, where she cut her teeth on news, before pivoting into personal finance at the height of the pandemic and cost-of-living crisis. Social affairs is another of her passions, and she has interviewed people from across the world and from all walks of life. Rebekah completed an NCTJ with the Press Association and has written for publications including The Guardian, The Week magazine, the Press Association and local newspapers.
-
Today's political cartoons - October 13, 2024
Sunday's cartoons - the swing of things, fear of facts, and more
By The Week US Published
-
5 timely cartoons about climate change denial
Cartoons Artists take on textbook trouble, bizarre beliefs, and more
By The Week US Published
-
Kris Kristofferson: the free-spirited country music star who studied at Oxford
In the Spotlight The songwriter, singer and film-star has died aged 88
By The Week UK Published
-
Men in Gray suits: why the plots against Starmer's top adviser?
Today's Big Question Increasingly damaging leaks about Sue Gray reflect 'bitter acrimony' over her role and power struggle in new government
By Harriet Marsden, The Week UK Published
-
Who will replace Rishi Sunak as the next Tory leader?
In Depth Shortlist will be whittled down to two later today
By The Week UK Last updated
-
Labour's first week in power
In the Spotlight The NHS, prisons and housing are at the top of a to-do list which risks crashing into 'wall of economic reality'
By The Week UK Published
-
David Cameron resigns as Sunak names shadow cabinet
Speed Read New foreign secretary joins 12 shadow ministers brought in to fill vacancies after electoral decimation
By Arion McNicoll, The Week UK Published
-
The five moments it went wrong for the Tories
In Depth From Partygate to the budget that broke Britain, the pivotal points in the Conservative Party's decline
By Rebecca Messina, The Week UK Published
-
General election: Britain heads to the polls
In depth Voters have remained 'curiously unengaged' throughout a campaign which seems to many like a foregone conclusion
By The Week UK Published
-
Bellwether seats and 'big beasts' at risk: how election night will unfold
In the Spotlight Excitement will 'really ramp up' as key constituencies declared through the night
By The Week UK Published
-
First-past-the-post: time for electoral reform?
Talking Point If smaller parties win votes but not seats, the 2024 election could be a turning point for proportional representation
By The Week UK Published