The North East Chamber of Commerce has called on the Government to work towards a ‘fairer, more balanced economy’

The new head of the North East’s largest business organisation has called on Chancellor Rishi Sunak to set a course for a ‘fairer, more balanced economy’ and add substance to the levelling-up agenda when he delivers his autumn Budget.

John McCabe, who has begun work as the new chief executive of the North East England Chamber of Commerce, said moves to ‘level up’ the UK had become ‘critical’ after the pandemic and Brexit hit the region’s economy more sharply than other areas.

In a letter to the Chancellor ahead of the October 27 Budget, Mr McCabe called for measures including rail investment, replacement of European funding and support for further and higher education.

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He also called for a clearer definition of levelling up and more devolved powers for the region. The letter comes after Mr Sunak made his first set-piece address to the Conservative Party conference, in which he announced a £34m fund to help make the UK a “scientific superpower” and defended recent moves to increase taxes.

However, Mr McCabe has warned that patience is running out for the Government to deliver on the levelling-up promise which helped it win a number of seats in the North East at the 2019 General Election.

He said: “The human cost of the pandemic has been appalling, yet there is also a tremendous economic cost to the regional disparities which have given rise to the unequal impact of the virus. Levelling up was of huge importance prior to the pandemic. It is critical now.

“Our businesses have performed admirably throughout the pandemic and are now beginning to see encouraging signs of recovery.

“They want this recovery to be sustainable, fair, and longlasting. We must learn the lessons of the pandemic to put right some of the biggest wrongs which hold our regional and national economies back.”

He added: “In addition to the pandemic, the North East was particularly exposed to the consequences of Brexit.

“Many businesses saw an almost overnight fall in their European sales and have been struggling to adapt to rules, costs and subdued demand.

“This has undoubtedly compounded the challenges they have faced in recent months. On top of this, we see continued problems created by disruption to global supply chains and staff shortages.

“We fully appreciate the pressure on public finances caused by the unprecedented demands of Covid and the resulting economic crisis.

“Firms right across the North East have relied on the support made available to them to get through the past 18 months, the absence of which would have resulted in catastrophic business failures.

“However, we urge you not to make spending decisions which will exacerbate business difficulties and set the progress of levelling up back even further.”

The letter includes an invitation for the Chancellor to meet the Chamber and its members and comes as Mr Sunak started work at the Treasury’s new Darlington office.

The autumn Budget will see Mr Sunak setting out spending plans for Government departments for the next three years.

It comes as the public finances took an unprecedented hit during the pandemic, with new worries over supply chain shortages hitting the hoped-for recovery.