Labour ministers urged to honour £73 million transport cash commitment to County Durham

A North East council leader has urged the Government to urgently confirm that it will honour a £73 million commitment to County Durham.

The county was awarded a share of the £4.7 billion Local Transport Fund earlier this year, as the Tories diverted funds following Rishi Sunak’s decision to scrap the northern leg of the HS2 rail project. But Martin Gannon, the Labour leader of Gateshead Council and deputy mayor of the North East, revealed this week that the region is yet to receive confirmation that Sir Keir Starmer’s Labour administration will still hand over that funding.

Coun Gannon told the North East Combined Authority’s cabinet on Tuesday afternoon that it would be “completely unacceptable” if Labour were to renege on the pledge. Durham receiving cash from that pot was seen as essential for transport upgrades in the county between 2025 and 2027.

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While other parts of the region are receiving money from the City Region Sustainable Transport Settlement (CRSTS) to cover that period, the fact that Durham was late signing up to the North East devolution deal meant that it was excluded from negotiations that led to a reported £147 million being earmarked for Newcastle, Gateshead, Northumberland, North Tyneside, South Tyneside, and Sunderland. The £72.8 million allocation announced in February this year was intended to make up for that, with Durham then to be included in phase two of the CRSTS programme beyond 2027.

Coun Gannon, who leads on transport issues in the NECA cabinet, said: “We know the Chancellor has made announcements about the £20 billion black hole in the public finances and, as a consequence, we are awaiting official confirmation of the £73 million of CRSTS funding for County Durham. Again, that will have to be confirmed by the Budget in October. It would be absolutely, completely unacceptable for us not to receive that funding we campaigned for and which was committed by the previous government”.

North East mayor Kim McGuinness said her authority had “made very clear representations to government that we require this money in this region in order to continue to grow”.

Coun Gannon also called for the Department for Transport to confirm that it will extend two major projects to improve bus services. The national £2 cap on bus fares is due to run until December 31, while a £163.5 million Bus Service Improvement Plan (BSIP) is scheduled to end in March 2025.

Coun Gannon said that the BSIP had had a “major impact”, helping to prop up bus routes that would otherwise have been at risk of being cut and funding a £1 bus fare for under-22s in the North East. He added: “We face two cliff-edges. BSIP funding, which we need confirmation of, and at the moment the £2 fare for everyone is funded by central government and we have no certainty about that going forward.

“Given the huge amount of work we have done to improve bus services over the past two years – to make them more attractive, to lower the cost so that people are more inclined to make the switch out of their car to buses – if that funding does not continue it will massively effect that work we have been conducting.”

A Department for Transport spokesperson said: “Transport is an essential part of our mission to rebuild Britain, and we are committed to improving connectivity across the North - and working with devolved leaders to achieve this. We will set out more details on funding in due course.”