Curly's Corner Shop, the blog!

South Shields premier political blog

Enterprise Zone good news for North East

with 4 comments

logoTyneside not forgotten in Budget

One of the better pieces of news from this week’s Budget was the announcement, from a Tory Chancellor who some decried as wanting to kill off the north-east, of the creation of two “enterprise zones” for the region, one to be in Teeside and the other to be on Tyneside, the exact locations to be determined by the members of the respective Local Enterprise Partnerships. I am glad that the announcement has received a “warmish” reception from the Labour Leader of South Tyneside Council Iain Malcolm who said:

“Clearly we have a decision to make, and we have until May until we need to advise the Department for Business on where we want this, but it is a welcome situation.”

The legacy of the last Enterprise Zones created in the 1980 Budget from Nigel Lawson is mixed with evidence of some lasting success and evidence of job transfers where employment had moved into an Enterprise Zone but had been lost from its previous location, from 1981 to 1986 the Enterprise Zones had cost nearly £300 million, but 2,800 firms were established in them, employing over 63,000 people. Some estimate that only around 13000 net jobs were created in the areas attracted by low local tax rates but the government at the time probably saw low tax revenue as being far better  than no tax revenue at all. Some locations such as the Merryhill Shopping Centre in Dudley, the Metro Centre in Gateshead, and the Canary Wharf redevelopment in London are seen as longer term successes where the employment provided probably equalled or bettered the employment that had previously been lost.

For us here in South Tyneside the location of the North East Enterprise Zone will be of paramount importance, as will the transition towards “wind down” as tax breaks and incentives inevitably need to be phased out, the hope being that capital flight will not occur as it did in Scotland in the 80s and to some extent other parts of the UK. Local councils will need to budget carefully in those areas where revenue will be lessened during the life of an Enterprise Zone and then carefully nurtured after the wind down in order to keep any new net jobs and encourage continued economic growth.

One of the most important factors will be the close proximity to the A19 with its new cross Tyne link and the availability of  The Port of Tyne as a major logistics facility, the partnerships arranged with other local authorities will need to be strong and effective in countering the claims of those on the north bank of the Tyne who may well have closer links to government than we do on the south side, although it ought to be appreciated that Cllr. Malcolm has been wisely networking with Conservative and Lib-Dem ministers for at least the past two years from a time when it became clear that Labour would have difficulty in winning an election under Gordon Brown’s leadership. His astute use of his business and political connections via lobbying firm Sovereign Strategy will have put him in a good place to promote South Tyneside as a place to do business, and a borough worthy of continued government support on whatever scale could be managed.

The Local Enterprise Partnership for the north east comprises members of seven councils covering areas of Durham, Tyne Wear, and Northumberland and it will be chaired by former Sage CEO Paul Walker, who after 16 years at the helm of the company was one of the longest serving CEOs of a FTSE100 listed company at the time of his departure, and it is important to recognise that the driving force behind this vehicle will have years of business and enterprise experience, rather than someone steeped in public sector service.

So now the difficult discussions need to begin on where we want an Enterprise Zone to be established, early suggestions include Wallsend with its green renewable energy plan, and land near the Nissan plant at Washington, I’m not sure if it is a requisite that one major zone needs to be created or whether it is possible to outline two or three separate areas that can be dovetailed together to provide a better mix of opportunities, in which case I’d like to see the Monkton business area in South Tyneside expanded to participate in the scheme. Wherever the LEP decides to locate the Enterprise Zone I believe that it is absolutely essential to look at the region’s infrastructure and quickly source more funding to improve the road networks that facilitate easy access to the A19 north and south of the Tyne to eradicate the “pinch points” that currently exist at Testo’s roundabout and the Silverlink, otherwise the eventual completion of the new Tyne Tunnel crossing will not provide as much relief as was first envisaged.

There is an opportunity being offered here for some sustained local economic growth which must not be missed, and our local council leaders need to be prepared to take bold and imaginative decisions which may shape the development of Tyneside for many years to come. They also need to be cognisant of the risks involved by the type of development allowed in the Enterprise Zone and how it impacts upon the livelihood of our existing town centres.

Do readers have any preferences or ideas about where and what type of development we would like to see from a north east Enterprise Zone?

add to del.icio.us :: Add to Blinkslist :: add to furl :: Digg it :: add to ma.gnolia :: Stumble It! :: add to simpy :: seed the vine :: :: :: TailRank :: post to facebook

Advertisements

4 Responses

Subscribe to comments with RSS.

  1. This is one of the best blog articles I’ve read from Curly, a very balanced approach. There is the worry that North Tyneside may take a lead for partisan reasons. Having said that renewable energy will be a big pull and within a few years crossing the great divide (the Tyne) may be easier than at present. It is welcome but as stated by Curly there is limited evidence that it will create new jobs rather than relocate them and also limited long term benefit other than retail outlets. What is the strength of the north east that can be invested into such a venture?

    Kevin

    March 25, 2011 at 12:27 pm

  2. I agree with Kevin, if only other members of your poltical persuasion based in S Tyne could blog articulately like this. My ambition is to see the North East at the forefront of the Green Industrial Revolution, but with far more rational health, safety and employee welfare policies than those that were evident in Victorian times.

    LL.B

    March 25, 2011 at 6:58 pm

  3. Thoughtful article from you Curly but please lets not go overboard with some this green energy nonsense, wind turbines are no good to anybody when the UK sits under high pressure weather systems, and thats generally when we need the most energy. High pressure in winter freezes us solid so we demand more electricity to warm us up, in summer it bakes us, so we demand more energy to cool us down with fans and air conditioning, yet just drive by Nissan today and you will see the turbines refusing to move.

    If we must go down this renewable route then can somebody please decide to manaufacture millions of solar panels in the north east, and I really don’t care where from, so long as it creates jobs and wealth.

    Sandman

    March 25, 2011 at 8:44 pm

  4. Worth researching the pros and cons of wind power on the internet. It is interesting to read contemporary comments condemning rail travel dating from the 1830’s and 1840’s.Green energy is not nonsense, not least because it is constructively harnessing natural, infinite rather than finite resources, as well as creating job and career opportunities in areas that need them.Equally important are energy conservation and recycling projects.

    LL.B

    March 26, 2011 at 7:57 am


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: