WORTH THE COST?: The cost of the Teesside Freeport to date has been revealed
The £2m has been split 50/50 between the Government, which is providing £1m of so-called ‘seed’ funding, and a further £1m from the Tees Valley Combined Authority.
The freeport, which was confirmed by Chancellor Rishi Sunak in his Budget earlier this year, but requires Government legislation to be passed before it is fully up running, will provide tax relief for businesses, along with simplified customs procedures and streamlined planning processes.
Rather than being restricted to just one area, the Teesside freeport is intended to cover sites across the region – including Teesworks, the Wilton International complex, Teesside International Airport, the Port of Middlesbrough, the Port of Hartlepool, Liberty Steel and LV Shipping – and be the biggest in the UK.
Tees Valley Mayor Ben Houchen has said it will attract investors and provide up to 18,000 jobs.
However the benefits are disputed by some who state freeports simply divert existing economic activity.
A spokesman for the combined authority said: “This £2m allocation includes £1m of Government seed funding, matched by £1m from the combined authority.
“This will support governance set-up costs and help us to develop detailed business cases to unlock further Government regeneration funding.”
The authority did not respond to a question about whether there had also been a cost to the successful bid to secure the freeport, which was led by Mr Houchen and supported by Teesside business leaders and Conservative MPs.
Former Redcar and Cleveland Council leader Sue Jeffrey said: “It is really important that we understand how money is being spent on the freeport.
“Particularly so in in Redcar and Cleveland where I continue to have concerns about the impact on indigenous businesses, business rate income and whether the benefits will reach the people of my ward – South Bank – and other disadvantaged wards in the borough, where the covid crisis has had the greatest impact on jobs and incomes.”
Mr Houchen previously told the LDRS that American firm GE Renewable Energy only took the decision to build a new factory at the Teesworks industrial site in Redcar because of the freeport status being secured.
He said: “GE may have been the first project to be announced since we were awarded freeport status, but it certainly won’t be the last.
“Since the Budget we’ve been inundated with international companies looking to invest in Teesside because we are set to be the UK’s biggest and best freeport.
“And I’m looking forward to being able to announce more international investments in the coming months.
“Thanks to the Teesside freeport we’re reshoring industry, securing investment and creating jobs.”
It is understood that further detailed discussions are continuing to take place with the Government about the exact composition of the freeport, which is expected to be governed by a board managed by the combined authority.
Once fully operational day-to-day running costs should, in theory, be met by the operators/businesses that are included in the freeport tax and custom zones.
Written by Stuart Arnold, Local Democracy Reporter
Watch the channel on TV