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The area was first settled by Europeans in the early 19th century, and a community began to develop around 1820. The settlement's name came from Newcastle upon Tyne, England. In 1856 it became part of Whitby Township until 1973 when it joined Scugog Township as an independent municipality. On January 1, 2001 the town was amalgamated with Brock township into Clarington; however its name remains unchanged for postal reasons (the post office is named "Newcastle"). In 2007 a new hospital opened in Bowmanville which caused some controversy due to its location being outside of Newcastle's boundaries and thus not covered under municipal taxes paid by residents living within them (although they are still served by city services). This has led some citizens to call for their own hospital or at least more funding towards the existing facility so that it can be upgraded beyond what would normally be possible given current budgets.