Chancellor John Healey has signalled that the Government could provide new funds to kickstart the long-awaited development of a new arena on the Gateshead Quayside. In his Budget speech on Wednesday, he named the Quays project as one of the regeneration schemes that will be backed by extra money being handed to regional mayors.
Years of setbacks and delays have plagued the vision for a world-class arena on the south bank of the River Tyne, with construction yet to begin on a riverside destination after the scheme was hit by spiralling costs. The North East mayor’s office signed off on a £24 million investment earlier this year to pay for infrastructure works on the site, nestled in between the Glasshouse and the Baltic art gallery, in order to “derisk” the project for private investors.
Chancellor’s Budget announcements
The Chancellor hinted on Wednesday that more public funds could be used to finally get the arena off the ground. He mentioned the Gateshead Quayside during the announcement of £285 million of funding for local leaders and a further £1.5 billion borrowing facility, enabling mayors to take out loans which the Government said would give them “access to capital needed to back the local priorities that will build growth in every postcode”.
The Chancellor also announced that the Government’s next international investment summit will be held in Gateshead in spring 2027. Further commitments include a pledge of £100 payments to around 20 million households in council tax bands A to D to help with soaring energy costs this winter, something expected to reach roughly 92% of homes in the region.
Mayor’s response
North East mayor Kim McGuinness said afterwards: “After years of fighting for the investment we deserve, I’m delighted we now have a North East Good Growth Fund helping us to deliver projects like a new arena in Gateshead and film and TV studios in Sunderland and these will just be the start.
“We will also get new powers to keep tax raised from these major developments and others. It's about time we stopped sending all of our tax to Westminster and instead use it right here in the North East. It’s good to see the Government agrees. This will be used for initiatives that directly cut the cost of living like cheaper fares on public transport in years to come.”
Mr Healey said that mayors will receive 20% of business rates next year and a share of income tax in 2028, with 100% of business rates to be locally retained by the end of the decade, and confirmed that strategic authorities like the North East will have the power to impose a tourist tax on overnight stays. £7 million was also committed towards a detailed feasibility study into staging a future Olympic and Paralympic Games in the North of England.
Local reactions
Ms McGuinness added: “We need to see more good jobs in our region too. That’s why we insisted in September the International Investment Summit should be held in the North. And now thousands of investors from across the globe will see what we have to offer when they come to Gateshead in the Spring. We will make sure this directly leads to opportunities for people on their doorsteps across the whole of the North East.”
The mayor’s £24 million pledge towards the arena works came after a review of the scheme, which led to it being scaled back to remove a planned international conference centre from the design. It was also the subject of a row between the Labour mayor and Gateshead Council’s new Reform UK administration, after council leader Nick Allan described the heavily-delayed Quays vision as a “vanity project” following his election in May.
Mark Ferguson, the Labour MP for Gateshead Central and Whickham, said that the planned investment summit would allow his town to “showcase on the world stage Gateshead's leading advanced manufacturing innovation, thriving creative industries, ambitious local businesses and brilliant schools and colleges developing the skills of the next generation”.
He added: “I’m also pleased that the Chancellor has announced new financial powers for mayors to invest in major projects. That creates opportunities to make progress on the long-awaited regeneration of Gateshead Quays, including the proposed arena. We’ve waited too long to see that site fulfil its potential. I want to see it transformed into somewhere that creates jobs, attracts visitors and gives local people something to be proud of.”
South Tyneside councillor Susan Sybenga welcomed the energy bill support for struggling households, but called on ministers to do more to protect local authorities from financial ruin. The Reform UK councillor, the local authority’s lead member for finance, said that South Tyneside requiring exceptional financial support from the Government to balance its books was a “very real prospect”.
She added: “This would not be a bailout or free money. It could mean borrowing more simply to keep essential services running. This would add further costs which would have to be repaid. South Tyneside cannot raise as much through council tax as wealthier areas. Yet our communities have some of the greatest need and highest demand for essential services. Our need is greater, but our ability to raise money locally is weaker. That is fundamentally unfair and the Government must address it.”
