A proposal to take over Durham Tees Valley Airport in a £40m deal has been met with a cold response from the area's five council leaders.
Tees Valley Mayor Ben Houchen and Peel Airports have announced that terms have been reached to bring Durham Tees Valley Airport (DTVA) back into public ownership.
Following a period of discussions under a non-disclosure agreement, the Conservative Mayor has presented a proposal to acquire Peel’s 89% shareholding in DTVA and 819 acres of land for £40million.
But Labour leaders of councils of Hartlepool, Stockton, Middlesbrough, Darlington and Redcar and Cleveland, have all raised questions over the deal.
Coun Christopher Akers-Belcher, leader of Hartlepool Borough Council, which has a 1.08% shareholding in the airport, said: “For the last eighteen months the Tees Valley mayor has done everything he can to undermine the current airport owners.
"As a result future success will not be just about purchasing the airport, we now also have the difficult job of rebuilding confidence with airlines and passengers alike to convince them that there is local support and that the airport has a viable future.”
Coun Sue Jeffrey, leader of Redcar and Cleveland Council said: “You don’t need to be an economic expert to see the risk here. Spending perhaps £40m on airport that was sold for half a million and loses between £2m to £3m a year is the sort of business deal that should send alarm bells ringing.
“It is vital that Ben Houchen’s airport deal is placed under forensic scrutiny. This is a man with no experience of running a major business, who seemingly just woke up one day and decided he was the best person to own an airport.
“The risk is substantial. Our devolution deal is worth £15m a year, and this airport will soak up that money. If it goes wrong, if Ben Houchen is not an airport expert, then we fear the mayor would be left with no option but to try to put up council tax in order to fill the financial blackhole this risk creating.”
Mayor of Middlesbrough, Dave Budd said: “Right now the Tees Valley economy is preparing for the huge uncertainty of Brexit. Unlike many other places, we have an advantage in the form of our devolution deal and the £15m a year it hands us for our priorities.
“Diverting that money to a loss-making airport at this time is a huge risk. We should be creating real jobs, not focusing on a vanity project.
“A safer route would be to back airport investment without taking ownership, but the mayor has consistently blocked any efforts to keep taxpayers money safe this way.”
Coun Stephen Harker, Leader of Darlington Council said: “The Labour leaders would love to see the Tees Valley have a successful airport, but not at any cost.
“At the moment there's no detail other than it will cost £40m to buy, with no explanation as to who is going to pay for the around £2m annual losses. Is that coming from the public purse too?"
Coun Bob Cook, Leader of Stockton on Tees Council said: “Purchasing the airport is just the start. We know that there is a need for significant investment in the airport infrastructure including the radar system and passenger security screening.
“All in all there will need to be an additional multi-million pound investment if the airport is to handle the passenger numbers that will make it profitable over the longer term. We need to understand what these costs are and how they will be funded.”