Date: Tue 14th October, 2008
Venue: The Radisson SAS, 1 The Headrow, Leeds, LS1 8TL
Number of Guests Attended: 32
Insider’s first pan-regional debate brought together leading thinkers from the North East, Yorkshire and the North West to debate the economy, cities and transport.
The first speaker of the day was Richard Lewney from Cambridge Econometrics, who was charged with looking at the bigger picture for northern economies to 2013.
The current downturn, he said, could be benchmarked against four factors: the falling number of jobs in financial and support services; the collapse of activity around “overblown asset values”, namely property; decreasing confidence in the lending community and the knock-on effect on investment; and the decrease in discretionary household spending because of high unemployment and falling wealth.
The audience was keen to understand how the region needed to move forward positively. Baron Frankal, director of strategy and research at The Commission for Economic Development, Employment and Skills, said the region would only recover if businesses recognised both the opportunities and challenges from international markets.
Felicity Goodey, chairman of Central Salford, agreed that the wider region is in danger of being too inward looking but warned against taking its eye off the ball. Garry Wilson, partner at private equity firm Endless, said that private funds could work alongside public money to help safeguard hundreds of jobs across the region.
Chris Murray from Core Cities, a grouping of eight English city councils, said the accelerated learning zones his organisation was promoting could help bridge the funding gap which all too often led to major infrastructure projects not getting off the ground. “Most people would reckon we have a problem,” he said, “and we believe we have found a solution.”
A system of “using the future to fund the future” by allowing local authorities to borrow against future growth and keep back more locally raised taxation could give a huge boost to northern city economies, the forum was told.
The proposal had a mixed reaction from the audience at the forum. Richard King, head of audit at Baker Tilly, pointed out that “cities that need such infrastructure the most will have the most difficulty in raising it” under such a system.
Both Goodey and Northwest Regional Development Agency board member Joe Dwek, while welcoming the proposal, championed other means of raising funds, in particular local corporation bonds and Local Authority Business Growth Incentives.
Bradford City Council leader Kris Hopkins and Baker Tilly’s Manchester office managing partner Mark Blakemore agreed more with what Murray said was the other major factor holding back development in the north – the region’s inability to work across administrative boundaries. “If we continue to look in small pockets we will continue to have petty political arguments about what’s right for my voters”, said Blakmore.
Mark Dransfield, chief executive of Dransfield Properties, said he would like to see more pressure put on central government to dedicate money it receives from speed cameras and from road tax. “Who knows where that money is getting spent?” he said. “We are all shareholders in the community, and it should be all about transparency.”
The north’s economy can only grow with improved transport connectivity, said business leaders from Yorkshire, the North West and North East at the third session of the day.
Insider editor Jim Pendrill, who chaired the debate, said the main worry at present is where the money is going to come from. With the government heavily geared and making £50bn available to the nation’s banks, is it realistic for the infrastructure projects to happen now?
Murray said the alternative is not an option. “It’s got to happen. The north absolutely needs that transport infrastructure. Our economy needs it and also our communities need it," he said.
Paul Edwards, finance director of NCC Group, based in central Manchester, said the congestion charge would just push the cost back onto the tax payer. “What comes first? Improved public transport so people don’t need to use their cars, or raising money through congestion charging with a view to hopefully getting the benefits in 15 to 20 years' time?”
Blakemore said the north risked suffering considerably in the current climate because the Olympics would suck a lot of money out of infrastructure projects in the regions, such as reducing regional trains into Manchester Piccadilly in favour of intercity trains.
The event, sponsored by Baker Tilly, was attended by 32 carefully selected business leaders who put forward their ideas to encourage key policy changes.
