West Midlands can’t fall behindFollow @PwC_Midlands
Now is not the time to feel demoralised, the West Midlands economy should not be allowed to fall behind as we begin to make the most of the value of the new Enterprise Zones.
Considered the engine room of the UK economy during the Industrial Revolution, the West Midlands region has managed to stay focused on the transition to the knowledge-based economy, creating some strong industrial companies. They have demonstrated their ability to deliver profitable returns even during some tough economic downturns. However, unemployment rates in some parts of the region are among the highest in the country and with levels of educational attainment slipping, business leaders and local authorities are concerned that the region could begin to fall behind.
Much is riding on the delivery phase of the region’s Local Enterprise Partnerships (LEPS). News that the Black Country has now confirmed the location of its Enterprise Zone at i54 is good news Our Enterprise Zones will help to create jobs, attracting skilled workers and provide opportunities for up-skilling too. The quicker they are up and running, the quicker the benefits will be felt beyond the zones as the LEPs accumulate business rates and invest back in the region.
The region’s LEPs have made a good start and there is an opportunity to create value by pooling resources for the region’s collective gain. For example, LEPs could be very influential in helping to attract different funding resources into the West Midlands. It is hoped that the Government’s current review of local government resources will address this by extending further financial incentives to local authorities, which could allow them to retain more money to invest in the region.
It is forecast that from April 2013 local authorities will also have tax increment financing to help stimulate the local economy. This means local authorities will be able to borrow money up front to invest in infrastructure in specific areas considered to have growth potential. The increase in business rates accumulated from any businesses moving into the area will be used to repay the debt.
There are many areas across the West Midlands that have suffered significant job losses since 2007 but still have significant growth potential. Local authorities can help to identify these knowledge pockets in the run up to 2013, so they are ready to invest in their development as soon as possible.
Email: Michael Kitts
Tel: +44 (0)1509 604025