Where others see a wilderness, Ben Houchen sees the largest development opportunity in the UK. As Tees Valley Mayor, a Conservative in a traditionally Labour area, he leads the campaign to get a vast tract of land on the southern bank at the mouth of the river turned into the country’s first free port.
ConHome interviews usually begin with the most striking words said by the interviewee. But on this occasion, the most dramatic element is supplied by the place he is talking about.
Maps and photographs, of the kind which adorn the South Tees Regeneration Masterplan, do not convey how big the site is. Nor does the information that it is 4,500 acres in extent, which makes it sound like a country estate.
Only when one goes there does one take in the size of the place. On Monday afternoon, Leigh Gooding, a Project Manager from the South Tees Site Company, drove me round a coastal plain the size of a small town, criss-crossed by bumpy roads and rusty railway lines, with grass growing through the foundations of the steel industry which rose and fell here.
No wonder people think of this derelict tract as a wilderness. For part of the site – a mere 400 acres, but still very large – is occupied by the hulking remains of the steel works which shut in October 2015: gigantic cranes which unloaded iron ore and coal, enormous sheds, pipes, chimneys, coke ovens and conveyor belts, and a huge blast furnace which, as Gooding put it, worked as “a controlled volcano”, reducing six million tons of burden, or raw material, to three million tons of molten iron, which was hauled across the site by the trainload and processed into steel at the Lackenby Works.
That volcano is now extinct. British Steel still produces, in its latest incarnation, steel beams on a small part of the site, but it had intended, in its nationalised form in the 1970s, to build three blast furnaces at Redcar, with an output of ten million tons. There was the room to do so, but not the political will, though one reminder of that era is Steel House, an astonishing 1970s exercise in brutalism, more like a bunker than an office building.
Although one could discern, through the mist, many signs of activity round the perimeter of the site, including a thriving port and a biomass power station under construction, the story these relics appeared to tell was of decline and fall.
Yet Houchen, unexpectedly elected the first Tees Valley Mayor in May 2017, believes that far from lagging behind the rest of Britain, Teesside can make such a success of free port status (something not allowed while the UK was in the EU) that many other ports will follow suit, until eventually “the whole country will become a free port”.
He expresses annoyance that Brexit, regarded with intense gloom by many commentators in London, obscures the good things which are happening on Teesside, of which the pundits know nothing.
ConHome: “So how are you going to build on your devolution deal here in Teesside?”
Houchen: “The big one is free port status. So we want to pilot free port status in the Tees Valley, specifically the South Tees Development Corporation site. That’s actually unique to our deal at the minute, we’re the only deal that can set up mayoral development corporations. Although I know others are now asking for it because they can see the benefit of it.
“And free port status would add value to that. So it’s not just about customs and tariffs. It’s about whether within that defined area we abolish things like corporation tax. Do we have more control as a combined authority over business rates?
“And then the other thing that we’re getting some traction with central government at the moment, and that we’re hoping to get traction for, is what additional powers could a free port have. So it’s not all about the financial side.
“So one of the big ones is we want to devolve planning for national infrastructure projects, so energy projects. The reason being that if all of the projects we are currently working on come off, we could be providing on the Development Corporation site more than 15 per cent of the UK’s energy in the next ten years.
“So to speed up the process of those energy projects coming to fruition, having a locally decided energy policy, we’d be much better placed.”
ConHome: “How will you generate the power?”
Houchen: “Unfortunately I can’t talk about that at the minute – although there will be an announcement in May.”
ConHome: “Is there a free port like this anywhere else in the country?
Houchen: “No. The free ports we’re talking about you cannot have inside the EU. You have to leave the single market, you have to leave the customs union, the customs union especially, and also state-aid rules.
“Because they have free ports, they would say, in the European Union, but what they are are glorified bonded warehouses. So they are things where you can defer the tax and duty and VAT. What we’re saying is within this zone, there will be full tax reliefs.”
ConHome: “So who’s in favour of this and who’s against it?”
Houchen: “In favour of it, we had a letter with more than 50 businesses that signed it. We’ve got support obviously from Simon Clarke [Conservative MP for Middlesbrough South and East Cleveland, who wrote about Teesside yesterday on ConHome], Anna Turley who’s the [Labour] MP for Redcar [which includes the proposed site], so it’s got cross-party support in that sense.
“And it’s getting a lot of support with ministers in central government as well.”
ConHome: “What does the Treasury say?”
Houchen: “We are currently in discussions with the Treasury.”
ConHome: “How much revenue would they be likely to forgo?”
Houchen: “We don’t think they would. There’d be significant growth. But even if there was an issue about the take in tax, it’s not about the take, they would have to defer it for a period of time. Because the type of imports we would get into Teesside would eventually come into the UK economy and therefore attract tax once it leaves that zone.”
ConHome: “But on Corporation Tax?”
Houchen: “On Corporation Tax, the type of growth we’re talking about isn’t currently there. So one of the reasons that free ports work in Teesside rather than elsewhere is that you’ve already got a fully developed Liverpool Dock, you’ve already got Southampton that’s fully developed, whereas here, even though we’re the fourth largest port in the country, out of the 4,500 acres of the port, there’s something like 2,500 still to develop, and it’s currently just empty brownfield site.
“And because we’ve got such a clear masterplan for the site, you won’t get a displacement effect. You’re not going to displace a business park in Darlington to move it to Redcar. It’s a very specific, heavy industry, advanced manufacturing, material processing project on that site.
“Which is seven times the size of the City of London, or one and a half times the size of the footprint of Heathrow. It’s a huge area.”
ConHome: “How quickly could you get on with it?”
Houchen: “Well we’re getting on with it now.”
ConHome: “Heathrow is a pretty obvious example of how planning can hold things up for a very long time.”
Houchen: “We’re hoping to have the outline planning approved by the middle of July. Now when we’re talking about the national infrastructure stuff there’s a second stage to go through. But when we’re talking about some of the material processing stuff, potentially car manufacturing, other things like that, actually it would speed up the process to get them on very, very quickly.”
ConHome: “So do you think you’re going to get it?”
Houchen: “I’m optimistic about getting it, actually.”
ConHome: “Presumably it fits in with the desire for an industrial strategy.”
Houchen: “When the Prime Minister came up to launch the Development Corporation in August she said to me that it is the perfect example of place-based industrial strategy. If you look in the Industrial Strategy, South Tees Development Corporation has its own section, because it is an exemplar of what the Industrial Strategy should look like.”
ConHome: “So it’s unlike London Docklands in that it’s not next to the City of London. But similar because there’s a large area of derelict land on which you can quickly do big things.”
Houchen: “It’s the exact same, but what we’re planning on putting on there is very different to what they put on the London Docks. But it’s the same concept. We are just tailoring it to what we know we’re good at, where we know our local economy’s going to grow.
“Part of what we’ve had to do as part of the industrial strategy is come up with our own local industrial strategy, to think with the private sector, ‘What do we do well in? Where are the growth areas? Where do we want to support?’ We’ve been through that exercise now.”
ConHome: “Are there objections from people who are close to here but are not actually within the Tees Valley, that you’re going to suck investment away from them?”
Houchen: “Nobody is against the idea of free ports that I’ve spoken to, especially in the private sector, especially those who are involved in ports, so ABP, Peel, we have PD Ports that run Teesport. They’re all supportive.
“The question they have is ‘You’re going to be quite protective over this, you won’t want anybody else to have it.’
“My argument is, well as a free-market Conservative I think the whole of the UK should be a free port, but on the basis that we’ve got to be practical, I want first-starter advantage, and once we’ve proved that it works, because it will work, if in 12, 18 months, two years’ time, we’ve shown that it works, then you know what, Liverpool, Felixstowe, Hull, the Humber, wherever, fill your boots. I don’t mind.
“I’m just trying to pilot something that I know will work. And I want that first-starter advantage, I want to generate the income, the increased economic growth, the jobs, and then everybody else should have it, and eventually over time the whole country will become a free port.
“That maybe is a bit more utopian than practical.”
ConHome: “I suppose Felixstowe had first-starter advantage as it was outside the Dock Labour Scheme.”
Houchen: “Exactly. People talk about the industrial revolution 4.0, and it’s all about digital. It’s not necessarily all about digital. Actually there is a huge amount of growth in energy, in material processing. If we get this right, which I’m confident we will, we will see the reshoring of manufacturing jobs we haven’t seen in this country for decades.
“People try to say, ‘Hang on, you’re going to get money laundering, you’re going to get loads of fine art that’s going to be stored there, and it’s just going to sit there and become a haven for malfeasance.’ No it’s not. We’re going to see an import of raw materials. We already do manufacturing, energy production, chemicals extremely well.
“We’re going to see the creation of genuinely thousands and thousands of manufacturing jobs in this country that went overseas purely because we were members of the European Union, the single market, the displacement into eastern Europe and southern Europe in lower wage costs, that will be able to be reshored because of free-port status, especially if they have the tax incentive of the tax relief element that we’re hoping to get.”
ConHome: “As a free-market Conservative, was it Margaret Thatcher, Sir Keith Joseph, who inspired you?”
Houchen: “No. The reason I’m a Conservative is I grew up on a Teesside that was just a sea of red, and all I saw, having been born in the mid-Eighties, you just saw a terminal decline of an area that was a sea of red. By the time I became politically aware you had a Labour government.
“I was 11 when Tony Blair was elected – we had a Labour government come in with, you know, the world’s booming, Cool Britannia. I was in Teesside and we didn’t see any of that. And I just thought, ‘Why are we continuing to vote for something that isn’t showing any material benefit to an area that needs it more than anywhere else?’
“And as a result I thought, if that’s what Labour stands for, and they’ve had the power in this region for decades, they’ve had national government for ten years by the time I got actively involved in politics, they are the wrong party, they are not the party of the people.
“And then you think, what is it about Labour, why have they ignored the region? It’s about this centralised, bureaucratic control. And let’s be honest. London is not that interested in the North-East.
“This building here, this whole estate, is where Margaret Thatcher did her walk in the wilderness. It was part of the Teesside Development Corporation. If you look at the last 40 years, the best things that have happened to Teesside have all been delivered through a Tory government.
“James Wharton [Conservative MP for Stockton South 2010-17, who got Houchen into politics and is greatly admired by him] will probably tell you exactly the same thing. A lot of Teesside Tories all have that similar story to tell.
“There are too many people who have made too much value out of talking down the area, keeping it on its knees.
“People and businesses want to be associated with good things. They want to be associated with winners and places on the up. So unless we start talking about ourselves in a really positive way, London aren’t going to do it, Cornwall aren’t going to do it for us. Andy Street [West Midlands Mayor] is not wandering round the globe saying ‘Go to the Tees Valley.’
“I know how brilliant this area is. It’s a great hidden gem. We’ve got the Dark Matter lab in Redcar that people don’t realise, that’s working with CERN.”
ConHome: “That’s going on after Brexit?”
Houchen: “Yes, that’s continuing. We’ve got serious minerals. While they’re digging the [polyhalite] mine in Whitby, the economic output is all generated in Teesport. That will add more than 20 per cent to the Tees Valley economy by itself, it’s a £5 billion project.
“The announcement in May to watch out for, that is another multi-billion-pound investment, happening in Teesside again. There’s so many good things going on, people realise when they come here, this is a pretty good place. And on top of that you’ve got beautiful places to live. It’s because there’s never been an advocate for the area, to say how great it actually is.
“If you speak to the North East Chamber of Commerce, there are more people employed now in the North East than have ever been employed before. We are at technical full employment. There are more jobs than there are people looking for work.
“I take my philosophy locally and blow it up nationally. We need to speak more positively about what we do. I don’t understand how it is I’ve not heard on the radio or TV for the last six months that unemployment is at record lows, employment is at record highs, there are more women employed now than ever before, that is a fantastic achievement of this government over the last eight years.
“And we’ve gone through Brexit. Inward investment continues to grow. For whatever reason we seem apprehensive, and we seem slightly cautious of singing the praises of all the brilliant things that are going on in this country.
“I think you can definitely extrapolate what happens in the Tees Valley, how we don’t talk that brilliantly about ourselves, to what happens in the party and the nation as a whole.
“You know what, people laughed, and some people thought it was a bit tongue in cheek, but you know what, message repetition. Long-term economic plan.”
Houchen: “Whatever people in the Westminster bubble thought of it, when I talked to people who were not politically engaged, they said, ‘Oh yeah, but the Conservatives have a long-term economic plan though, don’t they.’ They might not tell you what it is, but it cut through, it’s about one message. At the minute we need to give a clearer message on our economic achievements, because we’re not doing that. We’ve lost that message, despite doing brilliant things with the economy.”
ConHome: “Is your address actually ‘Council of Europe Boulevard’ here? Because that’s the road which runs past your building.”
Houchen: “It’s not, no. It’s just off the Council of Europe Boulevard.”
ConHome: “I think it should be preserved as a bit of history. It mustn’t be renamed, that boulevard.”
Houchen: “Well it’s ironic, given that the Tees Valley voted overwhelmingly to leave.”
Chris Rowell [Policy Adviser to the Mayor]: “We’re on Prince’s Wharf.”
ConHome: “What’s happened to inward investment since the Brexit vote?”
Houchen: “Inward investment is up hugely. International investors do not care about Brexit once it is explained to them. I was in Hong Kong with Jake Berry a couple of weeks ago, and we sat with some people from the Chinese sovereign wealth fund, and they made a few concerned noises about Brexit, and we talked it through with them, and by the end of the conversation they said, ‘Is that it?’
“The Japanese were the same, the Singaporeans, we got them over, and by the end of it, both of them between them had invested just over a billion pounds. Again it goes back to messaging. Because of this stupid argument people continue to have about the referendum result, that then has shock waves throughout the rest of the world, despite the rest of the world not really understanding what Brexit means, they think ‘Oooh, something negative’s going on over there’, when actually you look at free port status, you look at rebalancing the economy, you look at the investment it could bring – if you started talking about that, people would be flocking to the UK.
“When you have to explain to people that this is just white noise, you know there are people for whatever reason saying very negative things, but this is the reality, all of a sudden they’re quite happy to put their hand in their pocket. And again, that goes back to national messaging across all political parties. The foreign direct investment that we’re getting now is going to last us for the next 30 years. But you don’t hear that in the London Westminster bubble.
“That’s what frustrates so many people. You turn on the news and all you hear is negativity, generally or about Brexit, and people are fed up of it, because that’s not what people are feeling generally. People are actually feeling there are more positive things than people in London want to get their knickers in a twist about.
“Come and live in the regions. That’s what you’ve got to say to a lot of these people. Come and see what it’s really like rather than pontificating from the sidelines.”
ConHome: “John Prescott, for Labour, had the misconceived notion of devolving power to the regions. You and other metropolitan mayors represent a different approach to devolution.”
Houchen: “For devolution to work, you need an area which is a single economy, and distinctly a single community. So if you look at Teesside, I was born and brought up in Stockton, I am a Teessider, 31 years old, it’s all I know. If I spoke to someone from Darlington, or someone from Redcar, Hartlepool or Middlesbrough [the five boroughs which constitute Teesside], I feel they are part of one community, we are one people.
“And that’s important. For example we want to rebuild Darlington Station for Northern Powerhouse Rail. If I’m going to invest £100 million in Darlington, I’ve got to sell it to the people in Redcar. Now I’ve been surprised how easy that’s been, because the people in Redcar realise that’s an investment in them as well.
“But if you look at the One Yorkshire deal. If you invest £100 million in Northallerton Station for example, on the East Coast Main Line, the people in Sheffield, Rotherham and Bradford will be up in arms to say ‘Why haven’t you spent it on us?'”
Houchen, though one of the most ebullient people I have ever interviewed, is not yet well known. His wife teaches in a comprehensive school, his father is a police officer and his mother a teacher at a sixth form college. His paternal grandfather worked in the docks all his life: “My whole ancestry, I did it quite recently, but on the paternal side, we lived in Norfolk from about 1400 to about 1820, 1830, and then the whole Houchen clan just migrated to Teesside during the Industrial Revolution, and we’ve never left since.”