Sunderland City Council leader Paul Watson has hit back at claims the authority has rejected a devolution deal worth millions.
Last month, the Government’s Northern Powerhouse proposals were scrapped after four of the seven North East councils – including Sunderland - voted against the deal to boost job creation and transport powers.
The collapse of the deal raised fears it could leave the city trailing behind other local authorities in the North East after it was revealed Newcastle, North Tyneside and Northumberland are to try for their own joint deal.
Both the Conservative and Liberal Democrat opposition leaders in Sunderland have criticised the actions of the Labour majority, which they say could lead to the loss of £1billion in funding.
Coun Watson says the council did the right thing.
Conservative Coun Peter Wood said: “It’s time for Sunderland to get the devolution deal back on track or the city faces the prospect of losing millions of pounds in investment as well as an historic opportunity to gain more control for the region to set our own priorities.
The leaders of the seven local authorities did not dismiss or refuse the government’s devolution offerCoun Paul Watson, leader of Sunderland City Council
“The leaders of councils north of the Tyne propose talking to the government to take devolution forward but Sunderland, with its timid approach, is in danger of being left behind.
“There is considerable support for the North East to have more say in its own affairs both from the business community as well as within different political parties and £1 billion would be available to the region for improved services.
“The government was disappointed when the leaders of the four councils south of the Tyne – Durham, Gateshead, South Tyneside and Sunderland – pulled the plug on the next stage of the devolution process.”
He added: “Now that Theresa May has made clear her backing for the Northern Powerhouse, it is time to get devolution back on track so that the region can benefit from more investment and control, as is happening in Manchester.
Coun Watson said: “This statement is fundamentally incorrect. Coun Wood has misunderstood the scenario. The leaders of the seven local authorities did not dismiss the Government’s devolution offer.
“What we rejected, that time, was a scenario which was drawn up by various officers and people in local authorities, in conjunction with the government.
“It’s not a great offer, with just over £4million per council. It might sound like a lot, but with a budget of £650million, it’s not enough. The £1billion claim is entirely in fantasy land.”
He added: “My personal view is I don’t want to impose additional precepts on council tax and a levy on business rates, trying to put right the wrongs of the banking industry.
“The government should pay for that through general taxation and VAT.”
Liberal Democrat Coun Niall Hodson said: “If Newcastle, Northumberland and North Tyneside are pressing ahead with trying to get a devolution deal, then Sunderland Council should get round the negotiating table so that our city can benefit - not just Tyneside.
“Crucially, however, both Labour council leaders and the Conservative government ministers who are cooking up these devolution deals behind closed doors, need to give people in the North East a say over whether we want a ‘metro mayor’ to be in control of whatever new powers and funding get devolved from Westminster.”