We’re hearing that the cuts after the Comprehensive Spending Review could lead to up to 2,000 job losses over four years, as the council is required to save £50 million next year and £110 million over the following three years. And all that after making savings of £85 million over the last four years…
What does this mean for the city’s development, David? Can a city the size of Newcastle grow, renew and progress as well as manage and maintain on this level of resourcing?
Thanks for the comment. You will have seen the announcements yesterday that the city is both investing in the delivery of Stephenson Quarter on a commercial basis (see http://tinyurl.com/372dqxz), and committing to providing mortgages for the private Riverside Dene Block.
We can help sustain and speed up development in the city through our investment and from the use of new funding mechanisms like Tax Incremental Financing, which we have been one of the leading advocates for.
Of course, reduced public spending will have an impact on the economy, but that will be less if we take active steps to rebalance towards a confident, well supported and engaged private sector. We have again, I hope, shown what we can do in practical terms.
Thanks David. There’s some interesting work on Tax Increment Finance going on here: http://tinyurl.com/387m3zc.
We (the publisher of Renaissance) are organising a masterclass in association with the law firm Squire, Sanders and Dempsey, so I’ll declare self-interest, but it does look like TIF can provide some compensation for spending cuts. Not enough though to fully make up the difference, particularly as it could be a while before TIF becomes a reality – there’s a lot of work to do lobbying the government. There is some debate starting here http://tinyurl.com/327×7zw.
One question came out of a recent meeting in London, that council “headspace” will be so taken up with managing a response to the cuts that TIF will take three to four years to shape up. The example was in London Borough of Croydon where a waste disposal PFI process that had taken many months to put in place, but which must now be “re-booted” with the disappearance of PFI, is going to take a lot of reorganising, leaving little brainpower at the council free to look at TIF. What are your thoughts on that?
Secondly, the criticism has begun – I guess inevitably. How do you respond to the acusation that “the council is thinking of spending millions of pounds of taxpayers’ money on property deals at the same time as saying there’s no money for affordable homes or for the youth service and when thousands of people are facing losing their jobs”?
That quote is taken from the Journal here: http://tinyurl.com/323j5do.
This is good news. A proactive approach is exactly what is required, and I applaud it. There will be a lot of gossip about what should and should not be supported, and a huge dollop of self interest, all of which musst be ignored. It’s good to have a Council which is growing broad shoulders.
Our intellectual energy is already embedded in TIF. We have done the hard work to convince CLG and Treasury. We are more than ready to continue that engagement.
Also, regarding the criticism, an investment produces return. More than 30 years ago the city invested in Eldon Square. Today, that investment supports a good share of the city’s budget. We are making this investment on the same basis – it will produce a return. Of course, it will also produce wider regneration benefits as well.