£60m low-cost borrowing to create 11,000 jobs
North East LEP bid for Government loans approved.
Urban regeneration projects in Tyneside and County Durham are set to benefit from a £60m injection of cash to boost regional growth and create an estimated 11,000-plus jobs.
The North East Local Enterprise Partnership’s (LEP) proposal for £60m of Government borrowing at reduced rates has been approved by the Treasury. The green light was given to the full amount that the Local Authorities in the area were able to access under the discounted Public Works Loan Board (PWLB) scheme, which was announced by Chancellor George Osborne in last year’s Autumn Statement.
The Urban Cores Project, developed by the local authorities in the area, aims to improve urban infrastructure, encourage private sector investment and create 500 short term jobs and a further 11,000 in the longer term.
Paul Woolston, chair of the North East LEP said: “The Urban Cores Project is an ambitious programme, which will help us to deliver the LEP’s vision of ‘more and better jobs’ for the North East, and provide the enabling infrastructure to attract private investment in our urban centres.
“The North East’s towns and cities are the region’s major centres of employment and by improving the urban property offer and urban access, there is the potential to create thousands of quality jobs both now and in the longer term.”
The Urban Cores Project has three strands – providing the enabling infrastructure, improving the urban property offer and improving urban access.
In Newcastle, it covers work at the 12-hectare city centre site being developed as Science Central, and will improve access at the Stephenson Quarter and Central Station development, where a mixed use scheme has been approved.
Cllr Nick Forbes, Leader of Newcastle City Council, said: “The additional borrowing flexibility provided by the PWLB will help us invest a further £28m between now and 2015/16, stimulating growth and contributing to the creation of 7,000 additional jobs in Newcastle.”
Gateshead is set to benefit from investment of £15m. The money will be used to help create the North East’s first low-carbon district energy scheme. It will provide a stimulus for private sector investment in the Accelerated Development Zone and central Gateshead area and help tackle residential fuel poverty. The investment will also develop the Digital Quay project at Baltimore House in the Baltic Business Quarter, which will provide accommodation for growing SMEs.
Leader of Gateshead Council, Mick Henry, said: “The developments in our Accelerated Development Zone are expected to create more than 4,000 jobs. The investment will allow us to provide a real competitive edge to businesses locating or expanding in the area.
“The district energy scheme in particular will provide businesses with low-cost, low-carbon heat and power. It will also help to reduce construction costs by creating a network that is ready for developers to tap into. When energy costs are such a major consideration for so many businesses, we’re confident that this project will help us to attract new investment into Gateshead.”
South Shields 365, South Tyneside’s £100m masterplan for town centre renewal, will use £12m of PWLB money to develop the town’s new central library and community hub, which will include retail and leisure space.
Cllr Iain Malcolm, Leader of South Tyneside Council, said: “South Shields 365 is an ambitious vision for a town with fantastic potential, and we have already selected a top national developer to help us make it a reality.
“The loan will allow construction of a new landmark building to start next summer, as well as helping to attract further investment from the private sector.”
In Durham City, the project aims to create a high quality gateway into the city close to the mainline railway station. The £5m scheme includes works to open up North Road and create opportunities for future retail development at this vital gateway to the city.
Cllr Neil Foster from Durham County Council said: “We plan to start work on the gateway scheme next summer, releasing sites for redevelopment by the private sector. We anticipate the scheme will lead to between £25m-£35m of private investment in the area over the next three to five years.
“As well as demolition and construction jobs, the development of North Road will provide accommodation for businesses and the potential for an additional 500 jobs.”
The approval of the North East LEP’s bid to the PWLB means that work on the Newcastle, Gateshead, South Tyneside and County Durham projects will be able to start once the borrowing has been approved by the individual councils.