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North East Chamber of Commerce
10:24am Wednesday 20th February 2013 in Business News
AHEAD of a meeting I’m chairing for NECC Partners this week with Lord John Shipley (former leader of Newcastle City Council and deputy chairman of the Regional Growth Fund Independent Advisory Panel), I’ve been reflecting what regional economic growth is all about.
There are some who say we shouldn’t bother stimulating regional growth and that every part of the UK should stand and fall on its own merits. If you take the view that the only good things in the UK happen inside the M25 (not a view I share, by the way), then that’s probably fair enough.
But the people who express those views conveniently forget that the economic deck is currently stacked firmly in favour of the South-East. A recent IPPR study showed that public spending on transport per head was more than £2,700 in London and only £5 in the North-East. And that 84 per cent of publicly-funded projects only benefited London and the South-East.
So while standing and falling on your own merits is a fine concept, it needs to be based on a level playing field. Gamblers in Las Vegas can play a great game on their own merits, but still lose against the casino because the odds are always stacked in favour of the house.
This might be an unfashionable view, but I think what the North-East needs is not so much less public spending – imagine what we could do to transport in the region with an extra £2,695 per head to spend – but more of the right sort of spending.
We can pay people to sit on the dole or we can pay them some of the extra £2,695 to build a better transport infrastructure.
With that we can attract more jobs and take more people off the dole. With more jobs in the region’s chemical, manufacturing, engineering and exporting businesses we sell more overseas and sort out the UK’s trade deficit.
More economic growth and more sustainable jobs is what the Regional Growth Fund is designed to support.
And, for me at least, building and growing sustainable businesses in the North-East, where we’ve got the skills, space to grow and access to power and water, has got to make sense for the whole of the UK, not just us.
- Alastair Thomson is dean of Teesside University Business School and chairman of NECC Partners.