Magazine article Public Finance

Opinion Letters

Magazine article Public Finance

Opinion Letters

Article excerpt

Shires will pay the price for focus on cities

'New money, new infrastructure, new transport, and real new civic power too'. Sounds great! And, according to George Osborne, that's what's on offer in this year's Autumn Statement. But only, it seems, if you are one of the self-selecting "core" cities (Core Cities call for 10-year funding deal, Public Finance, p6, September).

I don't begrudge the cities getting real devolved power. They have done a great PR job on ministers. With their own think-tank and lobbying effort, they have hoodwinked Whitehall into thinking that only cities matter.

But that has led to some puzzling policy decisions - on youth unemployment funding, university enterprise zones, infrastructure spending and more - that have consequences for county areas.

I don't accept the premise that a boutique hotel or branch of Harvey Nichols means you're better suited for devolution than a place like Essex.

I don't believe that Manchester or Birmingham are more innovative or agile than their Lancashire and Staffordshire near-neighbours.

Devolution, with long-term funding deals and new powers, needs to happen in big places with big ideas and the appetite to see them through. We have that, as do some other counties. So why not us, too?

It would be less frustrating if we didn't share the same characteristics that government values in cities, but we do. A strong commitment to skills reform, the need to rebalance infrastructure spending (per capita spend on transport in the East of England is lower than many areas in the Northwest), and a focus on public service reform building on Essex's Community Budgets programme.

And I would argue the challenges we face are more acute, challenges that devolved powers and funding could help fix: demand and inflation-driven cost growth; an ageing population and a large geography. Essex has more young people than Manchester or Leeds and 5,000 miles of roads to maintain, three times more than Birmingham.

Betting the house on cities could work. But, like football's unhealthy focus on an elite 'big four', it will come with a price and that price will be paid in the shires. The chancellor would do well to remember that in the last Autumn Statement before the general election.



Essex County Council

Onshore oil is a good neighbour

I was interested to see that Jonathan Owen, chief executive of the National Association of Local Councils, has said parishes must be included in any funding agreements reached after the government's 14th licensing round for onshore oil and gas (Parishes join LGA demand for 'fracking benefit', Public Finance, p7, September).

The oil and gas under our feet is effectively owned by all of us, administered by the government on behalf of the Crown, which is one of the reasons that - even with short-term incentives - our tax rate is almost double that of other companies in the UK, therefore creating a significant benefit to the country as a whole.

That being said, we are committed to ensuring that local communities benefit directly too. That is why we launched, last year, schemes that will enable community benefits to be delivered and owned by local communities, for local communities, reacting to locally defined needs and addressing local priorities. These schemes could be worth between £5m and £10m per site in production and £100,000 per well in exploration phases. We are currently piloting a number of schemes administered by UK Community Foundations, which works through a UK-wide network of community foundations and, critically, is independent of the industry. …

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