Fears for £3 billion North East devolution deal following the fall of Boris Johnson

North East leaders have raised fears that the fall of Boris Johnson could destabilise devolution talks.

Negotiations for a region-wide deal are at an advanced stage, but the sacking of Michael Gove and departure of his junior ministers from the Department for Levelling Up, coupled with the confirmation Johnson is to stand down as Prime Minister, could stall progress.

Teesside-born Greg Clark was appointed as the new levelling up secretary on Thursday lunchtime.

Labour’s North of Tyne mayor Jamie Driscoll has said whoever replaced Mr Gove would need to provide a “solution to this instability”, while Glen Sanderson, Tory leader of Northumberland County Council, has echoed the concerns.

Prime Minister Boris Johnson addresses the nation as he announces his resignation.

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The proposed devolution deal would also see a regional mayor elected in 2024 to govern a new combined authority covering Gateshead, Sunderland, South Tyneside, Newcastle, North Tyneside and Northumberland.

It is expected to deliver more than £3 billion of Government funding over 30 years and could generate more than 17,000 jobs, if agreed to by local council leaders.

Mr Driscoll said: “Central Government is clearly totally unstable right now. But any Government that wants to win an election needs to convince people in the English regions that it will improve their areas.

Jamie Driscoll.

“So we might see new ministers. Perhaps the current ministers could be reappointed under a new leader – who knows?

"But the fact is, devolution works. As far as expanding North East devolution, we’re at an advanced stage of negotiations, and I’ve been in touch with ministers – and ex-ministers – today.

"But we do need a solution to this instability to make progress for our region.”

A previous bid for a North East devolution deal collapsed dramatically in 2016 amid a political split, after which Newcastle, North Tyneside, and Northumberland broke away to form the North of Tyne Combined Authority (NTCA), with Driscoll later elected as Labour mayor.

Since then, talks have restarted with a new deal thought to be close, Johnson’s resignation and uncertainty over the government’s future direction has thrown the process into doubt.

Glen Sanderson, the Conservative leader of Northumberland County Council, said: “Today we have no ministers in the Department for Levelling Up, I have no ministers to talk to about negotiations and we had been at an advanced stage.

“It falls to everyone in Westminster to deal with this matter and get ministers in position, to move forward and continue with the work we are doing.”

Amid speculation that Boris Johnson would resign but seek to stay as Prime Minister until the autumn while a replacement is elected from within the Tory party, Cllr Sanderson said that the “most important thing is that we fill or refill these posts that are crucial in the Government”.

He added: “It is crucial that we get those filled for the Government to work. [Whether Mr Johnson stays as Prime Minister until the autumn] is above my pay grade.”

Tracey Dixon, the Labour leader of South Tyneside Council, has appealed for a quick transition to address issues such as the cost of living crisis.

She added: “We need stability and surety and a focus from Government that they will work with us, helping our residents through this difficult time and building on our fantastic assets, rather than squabbling among themselves."