George Osborne reminded us towards the end of his Budget speech of a simple but indisputable fact about wealth creation – we will only raise the living standards of families in this country if we have an economy that can compete in the modern age.
The Chancellor was talking about Great Britain plc, but he might just as well have been referring to Birmingham where a combination of very high unemployment, a low skills base, some of the worst social deprivation in the UK, and under-performing schools make the city’s economy far less competitive than it should be.
Add to that depressing list the fact that private sector jobs have been disappearing at a rate of knots for several years, only to be replaced by public sector jobs now equally threatened by spending cuts, and it is easy to see why Birmingham in common with most of Britain’s large cities requires special attention from the Government.
Mr Osborne appeared to have this in mind when he told MPs that the West Midlands was categorised by a most unwelcome statistic – the only region in England where private sector employment fell during the years when the national economy was booming.
A number of his measures will bring welcome relief to families and businesses. Notably, the raising of tax allowances, a cut in fuel duty. a shared equity scheme for first time house buyers, and a cut in corporation tax.
The announcement that the Birmingham/Solihull Local Enterprise Partnership is to get one of the new Enterprise Zones is significant. The precise location is yet to be revealed, but the smart money is on the Eastside regeneration area where the zone’s tax incremental funding allowances will be used to stimulate much needed inward investment by encouraging new businesses to set up around the planned high speed rail terminal.
There were the usual glib soundbites. This was a budget, Mr Osborne declared, “for making things rather than for making things up”. How the MPs on the coalition side of the House laughed, but what does this actually mean in practice?
Birmingham, once the city of a thousand trades, will only escape from its economic woes if it can indeed get back to making things. Not the volume car production and metal bashing of the past, but by capitalising on new industries particularly in the media, environmental and medical sectors.
