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A decision over the multi-billion pound North East devolution deal will be shelved until after the May elections, it can be revealed.

Leaders of the seven North East councils were due to meet on Thursday and decide on whether to submit a bid to central Government to create a North East Combined Authority (NECA) with an elected mayor.

However, after Gateshead council rejected the deal and Durham, South Tyneside and Sunderland opted to defer a decision pending more negotiation with Government officials, devolution has been thrown into doubt.

Although the meeting will still go ahead, we understand that any formal decision will be kicked back until after the May elections to give more time to “find a way forward”.

The Government has advised that the latest date formal consent can be provided by NECA and the constituent authorities is May 16.

The deal, signed by North East authority leaders and Chancellor George Osborne last year, could mean an extra £30m a year for the region to spend – in addition to being given control of a £3.4bn pool of investment cash.

The region would also get new powers covering employment and skills, transport and planning and business activity – all intended to drive economic growth.

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Durham County Council leader Simon Henig said that his authority wanted to stay on the “devolution journey” but shared concerns about some aspects of the deal. He said: “We have deferred a decision as we need a few extra weeks to get a commitment on funding from Government.

“Everyone will come to the NECA leadership meeting with their own issues but we will try to find a way forward if we can, to find a way to make this work.

“It took Scotland a long time to get real devolution.”

Newcastle City Council leader Nick Forbes said that the region was in danger of being “left out in the cold” as the authority’s cabinet met on Wednesday night. Newcastle is one of the authorities to support devo, but not all its neighbouring councils agree.

Coun Forbes said: “No one is pretending this is a perfect devolution deal, there are caveats yes but we cannot pretend there is an alternative on the table, its devolution in its current form or nothing.

“The opportunity outweighs the concerns, I am worried that we will become the region that talks about devolution in principle but not in practice.

“We have done this before and I don’t want us to be the region that said no to devolution twice.”

Jeremy Middleton, North East LEP board member and Mayoral candidate, agreed that the region risks being left behind if no deal is done.

Mr Middleton said: “This deal is a once in a generation opportunity for the North East.

“Manchester and Sheffield are pressing ahead with theirs and Leeds and Liverpool aren’t far behind. Political stunts like this mean we might miss out on being part of a golden triangle of Northern prosperity.

“It is time for councillors and MPs to ditch these cloak and dagger intrigues and get do something for their communities.”

Council leaders from all seven local authorities that make up NECA - Northumberland, North Tyneside, South Tyneside, Newcastle, Gateshead, Durham and Sunderland - will meet at Durham County Hall to discuss the developments on Thursday.