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Chancellor George Osborne must “learn from the mistakes of the past” when taking forward proposals for new 'Enterprise Zones'. That’s the view of property consultants at the Birmingham office of Lambert Smith Hampton (LSH).

Stephen Hemming, director of planning, development and regeneration at the firm, said Enterprise Zones could be useful in encouraging growth, but only if mistakes from the Enterprise Zones of the 1980s were avoided.

The Chancellor announced the reintroduction of the zones in his speech at the Conservative party spring conference. The proposals would allow areas in the North of England and the Midlands to become “centres” for new businesses, with lower taxes and restrictions on growth removed.

Osborne will give more details in his Budget speech on 23 March.

The government is promising to invest at least £100m in ten new zones, which will aim to encourage business and employment.

But Hemming warns that lessons must be learned from the previous regime. Thirty-eight Enterprise Zones were created between 1981 and 1996, including two centred on Dudley and the Black Country and one in Telford.

“There were certainly pitfalls first time around. Many of the zones were simply in the wrong place and the result was that investors lost money. There is also evidence that new jobs created were at the expense of areas outside of the designated zones, and some of the prosperity created was short lived,” he said.

Ian Kibble, head of LSH’s Birmingham office, added that the zones need to be in “commercially acceptable areas which can bring the benefits of regeneration”.

He suggested areas including Birmingham, Eastside, Digbeth and Longbridge as potential sites.