One North East fighting to avoid deepest cuts

Jun 7 2010 by Adrian Pearson, The Journal

THE new head of One North East has revealed his officers are in detailed negotiations to deflect spending cuts to the South.

Paul Callaghan, the new chairman at the multi-million pound development agency, said yesterday he was confident he had the backing of Business Secretary Vince Cable.

And he praised The Journal’s influential Case for the North East campaign which he said helped convince the Government of the need for a regional development agency.

Mr Callaghan, formerly deputy chairman and head of software company Leighton, has admitted the jobs agency he will lead will be slimmed down but insisted it would still be able to lead international investment efforts.

“The future is looking much better than some had predicted,” Mr Callaghan said.

“Certainly the news we are getting publicly is that ministers see a significant role for the agency. There will be changes but the major role will be in economic redevelopment.

“And that is something we have been developing for years, especially in low carbon technologies.

“Right now we are in negotiations on the nature of our budgets. We have seen some indication of this in the national cuts to RDA budgets but the most recent indications are that the share of the cuts will be disproportionately in the South and the East.

“They will take the lion’s share as clearly it is felt that there is less of a need for these agencies.

“And those discussions are happening as we speak, people from the departments and our people are talking about what we can expect.”

One North East had faced the axe as Conservative ministers included it in a list of quangos they wanted to scrap.

The agency has seen some high profile successes in the last 18 months, including efforts to bring electric car production to Nissan’s factory in Washington and attracting offshore turbine manufacturers to the banks of the River Tyne.

In our Case for the North East campaign The Journal made clear the need to preserve a regional voice in Whitehall and abroad in order to build on these successes.

Ministers were also sent a letter setting out the need for a jobs agency for the North East signed by the region’s council chiefs and business leaders.

Mr Callaghan said: “They have made it clear they are very happy with a regional body, and to get this level is very influential.

“The press has also played a big role here, The Journal’s Case for the North East campaign has played a big role in this, both within the region and further afield and so now it looks as if of all the region’s we are the one that came together best.”

He added: “We are entering a crucial time for the region right now.

“If we don’t exploit the opportunities in the new technologies and new industries then we as a region would have missed out on the opportunity of a lifetime.

“We’re up for the challenge ahead and I’m optimistic we will succeed in making the best of what is available.”

Born in Sunderland, Mr Callaghan trained as an economist and has a first degree in Economics from the LSE, a Masters degree in Management and Education from Newcastle University and a further Masters degree in Finance and Economics from the University of Salford.

Mr Callaghan will receive £81,718 per year for a time commitment of three days per week.

His appointment lasts until at least 2012 by which time, he said “we will know how the economy has shaped up”.