Osborne delivers enterprise zone but U-turns get a mixed reception

Chancellor George Osborne delivering his Spending Review speech
Chancellor George Osborne delivering his Spending Review speech
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George Osborne’s Spending Review got a mixed reception on the Fylde Coast.

The Chancellor announced a raft of policies including a U-turn on his plans to scrap Tax Credits which aid millions of low paid families and planned cuts to the police budget.

That is welcome although we will have to examine the detail because people moving on to the new Universal Credit will still suffer reductions

But critics said families would still lose benefits in the long run as the new Universal Credit that will replace Tax Credits is set to be less generous and a two-child limit on child tax credit claims will start in April 2017.

The chancellor has also set out changes to housing benefits as he pressed ahead with £12bn cuts to the welfare budget.

Housing benefit for new social tenants is to be capped at the same level as in the private sector.

He has also said that local councils will be able to add two per cent to council tax bills in a bid to provide up to £2bn for social care.

And councils will be able to retain 100 per cent of their business rates by 2020, but the central government grant will be phased out.

The surprise announcement about tax credits came after the House of Lords threw out the original proposals.

The Chancellor said higher-than-predicted tax receipts and lower interest rates meant the Office for Budget Responsibility estimated that public finances would be £27bn better off over the course of the Parliament than it forecast at the time of the post-election Budget in July.

But Blackpool South MP Gordon Marsden said the ‘devil would be in the detail’ with the announcement.

He said on Tax Credits: “That is welcome although we will have to examine the detail because people moving on to the new Universal Credit will still suffer reductions.

“The news that councils will be allowed to keep all of the business rates might be good for places such as Westminster where they raise billions from business and have high rateable values, but here in Blackpool the reality is that the council will face a cut.

“The two per cent for social care is not likely to do much for an area where there is so much deprivation and it will not mitigate the cut in money coming in nationally from the Government for social care.”

But Blackpool North and Cleveleys Conservative MP Paul Maynard welcomed his Chancellor’s policies.

He said: “I felt today’s Autumn Statement shows the economy is continuing to move in the right direction and with the increased tax take from the many new jobs created over the last few years and the lower interest payments the Treasury is paying, it is indeed right that the Chancellor listened to the argument I and many others made and is continuing to support hard-working lower-paid families by maintaining their level of tax credits.

“There are other important announcements, including the protection of the policing budget, something I have called for in Lancashire for a number of weeks now in discussions with ministers.

“I am also pleased to see a real-term increase in the education budget, the biggest increase in 15 years to £119.30 for the state pension and continued and further investment in our health service with an additional £6bn cash injection”

Spending review at a glance...

• The planned £4.4bn cuts to Tax Credits due next April, softened, but a move to Universal Credit confirmed.

• No real-term cuts in police budgets, with spending to rise by £900m by 2020.

• But forces expected to make savings by sharing resources.

• The budget for defence is to rise from £34bn to £40bn by 2020.

• A £12bn cut to the welfare budget but the Government will breach its welfare cap in the first few years of this Parliament.

• England’s health budget to rise from £101bn to £120bn by 2020.

• An extra £600m is to go towards mental health services.

• But grants for student nurses are to be scrapped and replaced by loans.

• New social care “precept” in council tax of up to 2 per cent to allow local councils to raise £2bn for social care.

• The £15m raised from VAT on sanitary products will go straight to women’s health charities.

• Total education budget to rise by £10bn by 2020.

• 30-hour free childcare subsidy for parents of three-and four-year-olds to be limited to those working more than 16 hours a week and those earning less than £100,000.

• Sixth-form colleges will be allowed to become academies and further education budgets to be “protected in cash terms”.

• A new 3 per cent surcharge on stamp duty for buy-to-let properties and second homes from April 2016.

• £2.3bn to go to private developers to build 400,000 new homes in England.

• Councils will keep all revenue from business rates by the end of the Parliament, but the central government grant will go.

• Uniform business rates to be abolished

• 10 per cent of tax revenues from shale gas developments, up to £10m per site, will be put into a community Shale Wealth Fund

• An Apprenticeship levy will be brought in for big companies at 0.5 per cent of employer wage bill.

• Big energy users such as the steel and chemicals industries to be exempt from environmental tariffs.

• State pension to rise by £3.35 a week to £119.30 next year.

• Free museum entry to be maintained.

• Capital funding for transport to rise by 50 per cent by 2020.

• 26 new enterprise zones to be created or extended.

The Fylde coast has been given its third enterprise zone as the details of the Chancellor’s spending review were unpacked today.

The former ICI chemicals site at Hillhouse, Thornton, was granted the coveted status along with 28 others nationally, which will allow it to offer incentives for businesses to move there and create jobs.

It will form part of a hi-tech skills jigsaw together with the enterprise zones at Blackpool Airport, and the BAE Systems site at Warton and Samlesbury.

The Hillhouse site will focus on the chemicals sector, building on world-class expertise within companies already on the huge 138-hectare site.

The Lancashire Enterprise Partnership forecasts that the new zone could potentially double the number of jobs to 3,500 within the next 10 to 20 years.

The site, which has been a centre of advanced chemical manufacture since the 1950s, is already occupied by 40 companies, such as Victrex, AGC Chemicals and Vinnolit.

Under the new proposals, the LEP and local partners plan to build on Hillhouse’s hi-tech chemical and polymer heritage, but will also target firms within the wider energy and advanced manufacturing sectors to complement Lancashire’s over-arching Enterprise Zone strategy.

The LEP said this would include forging links between the Energy Enterprise Zone approved this month for Blackpool Airport, and the Advanced Manufacturing and Aerospace sites.

LEP Board member Graham Cowley said: “This decision is a significant boost to the local economy and Lancashire as a whole, helping to create thousands of new jobs and spur economic growth over the coming years.

“Lancashire is already a world-leader in the chemical and polymer industries and home to a number of first-class international firms, and the EZ at Hillhouse will help ensure we stay at the forefront in this area and also attract and support business in the wider energy and advanced manufacturing sectors.

“Hillhouse is a key part of the LEP’s ambitious and comprehensive multi-million pound strategic economic growth programme.

“The Hillhouse site complements Lancashire’s three existing enterprise zone sites which will combine to make a compelling Northern Powerhouse opportunity to potential industrial investors and occupiers. Lancashire is well-positioned to play an important role in driving the economic prosperity of the North through growth in well-established high-value, high-skilled sectors.”

Rob Green, of the Blackpool Fylde and Wyre Economic Development Company, said: “We have seen good growth at Hillhouse over the past five years and there are prospects for growth in energy generation and for a world-class cluster of polymer companies.”

The LEP’s strategic economic growth programme aims to boost the local economy by £3bn by 2025, creating 50,000 jobs. The LEP will also support the delivery of the infrastructure needed to achieve this, including the building of 40,000 new homes.
Firms on the Hillhouse EZ site will benefit from a range of incentives and benefits including reduced business rates and improved collaboration between companies.

MP says zone will make Northern Powerhouse come alive on Fylde

Blackpool North and Cleveleys MP Paul Maynard welcomed the new enterprise zone status. He said: “I am really pleased that the Chancellor has approved the application for Hillhouse International at Burn Naze in Thornton to become an Enterprise Zone. “This really is a shot in the arm for local businesses and investors who want to create good-quality and high-skill jobs locally. I met with the Chancellor only a couple of weeks ago and made the case that this area as a prime location for business development, for investment in skills and for the creation of jobs.

“This, coupled with the £50m investment in an A585 relief road, really makes the Northern Powerhouse come alive for our bit of Lancashire.

“I am really pleased that both the local zones I have helped initiate have now come to being.”