Birmingham primed to deal with CSR, says GVA Grimley
Birmingham is well placed to deal with the public sector axe which will fall today, Insider has been told. Property consultancy GVA Grimley said the city "is in a prime position" to trial tax increment financing (TIF) following the comprehensive spending review (CSR). GVA, which has an office in Birmingham, added that today’s cuts will be phased “over several years” to lessen the impact on the UK’s fragile economy.
A public financing method such as TIF could be introduced to fill the gap left by spending cuts, suggested Stephen Hollowood, executive director at GVA’s Birmingham office.
Hollowood said: "Tax Incremental Finance, which works well in the US, has recently been supported by government as a way to fund infrastructure on major projects. The finer detail of how TIFs could work is currently being ironed out. As the largest local authority in Europe, Birmingham City Council is in a prime position to trial how a TIF would work in the UK and local projects have already been recommended to government."
GVA Grimley said the CSR will put further pressure on local authorities and the new Local Enterprise Partnerships (LEPs) to detail how they will deliver growth to compensate for the likely public sector jobs cuts.
Hollowood said: “The spending review cost cutting that will be announced is likely to be radical; however, much of it has already been widely trailled and many measures have already been implemented. Birmingham City Council, for example, is recognised as an exemplar local authority for improving efficiencies, but it is clear that there are deeper cuts to come across the board.
“Even if the scale of public sector redundancies is relatively modest, this may still amount to almost 700,000 job losses across the UK. There could be a further 275,000 jobs lost as a knock-on effect to local economies, due to lack of spending by people who have been made redundant.”
He said that infrastructure developments were "a key driver" for the jobs market, and cited the high-speed rail expansion as a creator of future jobs.
