Looking at the Teesworks review one year on
Plus: Boro FC legend's surprise TV appearance and (£) incinerator bidder sues council
Here it is, the 26th edition of The Teesside Lead. Oh, how it only feels like yesterday when we were launching on Substack.
This week’s edition has a long read looking at what’s happened in the year since the government published its review into the Teesworks saga, a former Middlesbrough FC player popping up in an unexpected place, a huge twist in the tale of a planned Teesside incinerator, news on the owners of the enormous polyhalite mine in North Yorkshire, job creation, and how a council is being sued by a bidder for another planned incinerator for allegedly breaking procurement law.
In brief: it’s chocka. It’s rammo-kablammo, and I’m really proud of this edition.
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Have a great day, and see you on Wednesday!
Leigh
After eight months of waiting, we had an idea it was coming on that day, but no clue of when. It was published on the government’s website at around 4.20pm, leaving me with just over an hour to read and digest a 96-page report and then write a cover story in time for the next day’s paper going to press.
Since the Tees Valley Review’s publication a year ago, it’s still one of the only “sacred texts” covering the Teesworks saga - the regeneration programme at the former Redcar steelworks site that’s seen more than £500m of public money spent, and two local businessmen receiving up to £130m between them without any investment themselves.
The review was set up by then secretary of state Michael Gove to rebuff accusations of “industrial-scale corruption” at Teesworks, made by Labour MP Andy McDonald in May 2023 in reference to reports in Private Eye magazine.
After the announcement of the panel, led by the then Lancashire County Council chief Angie Ridgwell, in early June 2023, it was initially thought it would probably report back by the time Parliament rose for its summer break at the end of July.
When it was published on 29 January 2024, the review said it “found no evidence to support allegations of corruption or illegality”. Tees Valley mayor Ben Houchen would repeat this line on his many press interviews which followed, also quoting the paragraph number, 1.7.
What he always failed to quote was the very next sentence in that paragraph: “However, there are issues of governance and transparency that need to be addressed and a number of decisions taken by the bodies involved do not meet the standards expected when managing public funds.”
The review set out 28 recommendations. A year later, have those issues of governance and transparency been addressed?
According to Tees Valley Combined Authority (TVCA), the public body with overall control of the scheme, the answer is “yes”. Its chief legal officer reported to a meeting last week that of the 26 recommendations which were applicable to TVCA, 25 were “complete” and the 26th was “partially complete”.
That “partially complete” recommendation is that conflict of interest training has not yet been arranged for members. Staff at the authority had their training earlier this month. Outgoing CEO Julie Gilhespie, who’s set to leave the authority in April (although TVCA have yet to confirm if she’s retiring or being made redundant), was heavily criticised in the review for not only failing to declare conflicts of interest, but for failing to even recognise they existed.
Her daughter, Caitlin, has been employed at TVCA since September 2023 - in the middle of the period the review panel was conducting its investigation - but in October 2023, Julie Gilhespie signed a conflict of interest form declaring she had no “close relatives or associates [who] have an interest in any actual or potential contract with any TVCA Group entity”.
This wasn’t picked up by the review, but by me for The Yorkshire Post last year.
The most important recommendation, which gets to the nub of why the entire review took place, is 22. It said: “[South Tees Development Corporation] should explore opportunities to influence when and how land is drawn down and developed and if possible, renegotiate a better settlement for taxpayers under the [joint venture] agreement.”
Teesworks Ltd, the company set up as a 50-50 joint venture between the South Tees Development Corporation, chaired by Ben Houchen, and businessmen Chris Musgrave and Martin Corney, had 90% of its shares handed over to the businessmen for free, and in secret. The discovery of this share transfer is what led to the accusations of corruption.
The Tees Valley Review had been critical of the way Musgrave and Corney were able to choose to buy land at £1 per acre after extensive remediation costs from the public sector. It showed how the businessmen were under no obligation to buy land after the public sector had paid to remediate it, allowing the duo to “cherry pick” the more valuable land, and potentially leaving enormous liabilities on the public’s balance sheet.
In August, Gilhespie met with Corney and Musgrave, who agreed to “reluctantly consider renegotiation on some matters”, according to the meeting’s minutes, in order “to avoid any further negative publicity directed towards the site.”
However, they have refused to renegotiate the 90-10 equity split which is the root cause of that “negative publicity.”
In their formal response to the request to renegotiate, sent to STDC on 17 September last year, Corney and Musgrave refused to budge on the equity split, saying, “the [financial] return to the private sector partners is a fraction of that to the public sector partners.”
Teesworks Ltd is allowed to draw down any part of the former steelworks site that’s remediated over the next 30 years, however, the businessmen have offered to halve that period to 15 years and provide six-monthly progress updates to the development corporation’s board.
The fate of this offer, and that of TVCA’s official response to the Tees Valley Review, is in the hands of secretary of state Angela Rayner. She has had it on her desk since the end of September, and was advised before Christmas by civil servants to send the National Audit Office to investigate.
Which brings us back to exactly the same place we were in May 2023. In the intervening time Lord Houchen has changed his mind, saying there’s no need for the NAO because the review has cleared the project of any wrongdoing (although it was clear in its limitations and in what it didn’t investigate).
As a Parliamentary body, the NAO can only legally investigate money spent by central government. However, it can investigate local authorities (which includes TVCA) if two conditions are met: the secretary of state approves it, and so does the authority in question.
Lord Houchen will no doubt argue sending the NAO in would be a political attempt to punish the only Conservative metro mayor in the country. Time will tell if that argument holds up against the increasing political pressure to open the books that will come in 2025.
Last week, even the Daily Mail picked up a Teesworks story reported by Private Eye, so it may be that that pressure becomes unavoidable much sooner than expected.
Boro legend makes surprise Welsh TV appearance
Middlesbrough FC goalkeeping legend Mark Schwarzer made an unexpected appearance on Welsh language TV on Friday night.
He was interviewed at half time during S4C’s live broadcast of the fixture between Newtown and Briton Ferry in the Cymru Premier.
The shot-stopper was in mid-Wales to watch his son, Julian, make his debut between the sticks for Newtown, who play in the top flight of the Welsh domestic game.
After taking a 2-0 lead, the younger Schwarzer conceded from a free kick and a deflection to lose out on two crucial points in their relegation battle.
You can see the interview at this link, and Julian was also interviewed, which you can see here.
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🦴 Middlesbrough TV presenter Steph McGovern broke her upper arm after slipping on ice
Redcar councillors deny permission for hazardous waste incinerator
In the last edition of The Teesside Lead, I reported that a new hazardous waste incinerator planned for the Wilton site was likely to be given the go ahead after council officers recommended its approval.
However, in a shock turn of events, councillors on Redcar and Cleveland Borough Council’s regulatory committee voted to decline planning permission.
Councillor Lynn Pallister, who represents the Grangetown ward and is a member of the committee, said there was a “mass” of incinerators in the area, adding that the developers “should look at another site. There has to be a stop to how many there are in one area.”
After the proposal to approve the incinerator failed to find a seconder, a motion to reject the application was narrowly passed by five votes to four.
Takeover of polyhalite mine owner off after share price increase
Anglo American, owner of the mothballed Woodsmith mine, appears to have successfully defended itself from a takeover bid launched last year.
Australian firm BHP attempted a £39bn takeover of the mining company, which is responsible for the enormous Woodsmith polyhalite mine project in North Yorkshire. The suspended mining scheme aimed to extract polyhalite from beneath the North York Moors national park, and send it 23 miles by conveyer belt to Teesside where it reaches the surface at Wilton for export.
Anglo was forced to cut costs and sell parts of its business in order to protect its share price from the takeover bid. The FT reported yesterday that BHP now believes the takeover won’t happen after an increase in Anglo’s share price made it too expensive.
Anglo’s current share price is roughly 3 percent higher than BHP’s offer last year, valuing the company at over $42bn (USD).
When the company announced plans to mothball the Woodsmith project in May last year, up to 2,000 jobs relied on it. It’s thought around 60 percent of those have been impacted by the temporary closure, although a date for re-starting the project isn’t yet known.
Previously announced expenditure of £800m a year on the project between 2024 and 2026 was revised to just over £150m in 2025, and nothing next year.
New sustainable aviation fuel plant confirmed for Teesside
“Our Freeport is the the FIRST, LARGEST, and MOST SUCCESSFUL in the country and now we have landed ANOTHER big project,” boasted Ben Houchen on social media this week, as he announced another new project to produce sustainable aviation fuel (SAF) on Teesside.
While “Teesworks” is a limited company 90% owned by Chris Musgrave and Martin Corney, the name is also used interchangeably with the freeport, which covers a much larger area - something Lord Houchen was using to his advantage in his post.
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