The spending statement issued by chancellor Rishi Sunak held few surprises but its commitment to invest in homes, infrastructure and the green economy has been welcomed by a range of businesses and organisations across the North East.
There is also concern at forecasts that the UK economy is set to shrink by 11.3% this year, that 2.6 million people will be without a job by the spring, and borrowing will hit £394 billion this year.
However, many have welcomed the government’s commitment to the levelling up agenda – with an announcement of a £4bn package to fund local infrastructure projects and a new UK infrastructure bank to be in the North.
Other headlines relating to employment and business include:
- £4.6bn package to help people back to work
- £2.6bn for Restart scheme to support those unemployed for more than a year
- £1.6bn for the Kickstart scheme to subsidise jobs for young people
- £375m skills package, including £138m to deliver Lifetime Skills Guarantee
- Business rates multiplier frozen in 2021-22
Whilst expressing concern at the 7.5% jobless figures, Chris McDonald, Chief Executive of Teesside’s Materials Processing Institute, welcomed the unexpected announcement of the £4bn ‘levelling up’ fund for local infrastructure projects and confirmation that a National Infrastructure Bank (NIB) will be headquartered in the North.
He said: “The levelling up fund includes £3m for the UK’s first Hydrogen Transport Hub here in the Tees Valley, whilst the NIB is expected to work towards achieving the government’s 2050 net zero target and the creation of 250,000 green jobs. This funding reflects the North East’s position as an innovator in decarbonisation and delivering pioneering green energy projects.”
Jo Robison, director at Newcastle-based DPP Planning, said of the levelling up fund: “There are towns across the country, particularly in the North, that will benefit hugely from this scheme, not only in terms of access to the funds, but the greater opportunity to influence the growth and prosperity of their local area. A co-ordinated North East response is now needed to get the funding to where it is needed the most.
“The ability to champion projects, such as new road systems or community buildings, and tap into this fund further pushes the government’s devolution agenda while strengthening the opportunities to shape the future of the North.
“In particular, the past year has generated an enforced and accelerated evolution of town centres, which will require fresh thinking and a new approach to maximise their role in the living, working and leisure time of local people.”
Teesside entrepreneur Allan Hoggarth, who operates several enterprises, including Wilton Recovery, welcomed the further measures to support jobs, in particular those who find themselves out of work long-term.
He said: “I was encouraged by the announcement of a £100bn capital spending package next year. Investment in things like building houses, roads, and creating a green economy will both help preserve jobs and create new ones – providing real opportunities for many of this region’s small and medium-sized businesses.”
Matthew Wharton, a director of Darlington-based Wharton Construction, said: “The government’s investment in homes and infrastructure has real economic benefits and will also keep people in jobs and preserve the skills across a variety of trades. This country needs to continue to improve and update its infrastructure so that it is in a position to grow the economy once this pandemic is over.
Gavin Cordwell-Smith, CEO of Hellens Group, which operates from offices in Washington and Teesside, said: ““The new levelling up fund and the announcement that the chancellor has revised the Green Book rules appears to be very exciting news for the North; it has the potential to be transformational for the North and could be one of the few positive changes to come out of the COVID-19 crisis.
“We have experienced first-hand how difficult and frustrating it can be under the current rules to attract funding to projects in the North East and the Tees Valley. Let us also hope that one or both the regional offices for the Treasury or the UK Infrastructures Bank comes to the North East or the Tees Valley (rather than just Manchester or Leeds). This would represent a real statement of intent by the government to level things up”.
Martin Anderson, MD of Stockton-based Lemon Business Solutions, said: “As a Teesside-based services company we are looking to the Chancellor to begin delivering on some of the promises made at the last election. No longer can words just be spoken and false promises made, we need real action and investment flowing into the North East, to enable the region’s business leaders to drive forward with ‘levelling up’ the country. If he gets this wrong, it will undermine confidence in the sincerity of the government’s agenda for the North.”
Bob Borthwick, a director of Stockton-based Scott Bros, said: “It’s good that the prime minister and chancellor remain committed to the levelling up agenda. The levelling up fund will not only improve peoples’ lives but create jobs and stimulate the local economy. These are difficult times given the amount of government borrowing so any investment is to be welcomed – although at some point it will have to be repaid.”