The State of Britain

A strong uplift in SE growth, an unwelcome UK first in the region and Sussex councils hope to WOW tourists and beer drinkers

Reading Time: 4 minutes

Growth in the South East increased by a striking 0.7% to 2.0% in the year to March 2019, the second highest uplift in the UK according to estimates from ESCoE. At 2.7% and 0.7% London and Northern Ireland had the highest and lowest growth rates in the country. The East of England was the most improved region of the UK with growth accelerating from 0.9% to 1.9%. The UK growth rate for the same period was 1.5%.

Unemployment in the South East increased slightly by 7,000 to 151,000 between January and March, an uplift of 0.1% to 3.2%. At 2.4% and 5.4% the SW of England and the North East had the lowest and highest unemployment rates in the country. The UK unemployment rate stands at 3.8%.

In March, average earnings in the South East increased to £691 per week. London had the highest average earnings of £762 whereas the Northern Ireland had the lowest of £513. In the UK average earnings grew by 3.3% or by 1.5% after inflation.

South East average property prices fell by 0.6% to £318,491 during the month which meant annually prices dropped by 0.4%. In comparison UK prices dropped by 0.2% to £226,798 during March which cut the annual growth rate to 1.4% although transactions were up by 1.4%.

In its estimate of regional public spending and regional tax revenues in 2018, the ONS concluded that the South East had a surplus of £20bn. This compares with London which had the highest surplus of £34.3bn. On a per person basis the South East surplus was £2,258, London had the highest surplus of £3,905 per person and Northern Ireland had the biggest deficit at £4,939. The only areas of the UK to run surpluses were London, the South East and the East of England. At a national level, the UK had a deficit of £636 per person which split into deficits of £106, £2,452, £4,395 and £4,939 for England, Scotland, Wales and Northern Ireland.

Alexander Dennis, the world’s largest producer of double-decker buses, has been sold to a Canadian firm for £320m. The company will now become part of the NFI Group, which makes buses for the North American market. Over 300 staff are employed at the firm’s chassis factory in Guildford. Also, a vote of confidence in Buckinghamshire after packaging business Ecopac (UK) Ltd was bought by Glasgow-based packaging firm Macfarlane Group. Ecopac focuses on customers based near its 60,000 sq ft facilities near Aylesbury. Macfarlane is the UK’s biggest protective packaging distributor.

An unwelcome first for the region after Hadlow College in Kent, was put into educational administration – the new UK education insolvency regime – after the Education Secretary applied to the High Court. The college has more than 2,000 students and 454 staff and specialises in rural sector training. Accountancy firm BDO has been appointed as education administrators. Also in Kent, British Steel has been placed in compulsory liquidation putting 40 jobs at risk at a distribution centre in South Darenth. The Official Receiver has taken control of the company as part of the insolvency process and hopes to find a buyer from the 60 firms which have expressed an interest.

Online food retailer Ocado, has decided to rebuild an automated warehouse in Andover, Hampshire, after a fire destroyed the previous distribution centre which processed 30,000 orders or 10% of Ocado’s capacity each week. Up to 400 jobs are at risk because the construction project will take at least two years.

On the trains, the National Audit Office (NAO) has said the new east-west London railway Crossrail, was driven over its budget and beyond its schedule after management clung to an unrealistic opening date. The overall budget for Crossrail has risen from £14.8bn in 2010 to £17.6bn. Changes to designs and contractors’ delivery schedules cost around £2.5bn between 2013 and 2018, according to the NAO’s analysis.

The reintroduction of refurbished 1980s Class 442 trains – nicknamed ‘plastic pigs’ by commuters – has been delayed by the South Western Railway (SWR) over safety concerns. Planned new services between Southampton Airport and Poole and Waterloo have been postponed. The mothballed trains were being refurbished at Eastleigh in Hampshire but only six of the 18 trains were ready – the rest may take a further year to complete. The £45m refitting project was intended to get extra seats into service more quickly than would have been possible with new trains.

On development, plans have been submitted to New Forest District Council to build a new town on the site of the former oil fired Fawley Power Station which closed in 2013. The £1bn Fawley Waterside project would incorporate 1,500 homes and create 2,000 jobs. The station’s landmark 198m chimney would be demolished in 2020 then replaced with a 100m tower which would act as a navigational aid for sailors. Building work would begin in 2021 and the first homes would be available by 2023. Plans to build 600 homes and an IKEA superstore in Lancing, West Sussex, have not been called in by the government. The £150m New Monks Farm development will create hundreds of homes, a new roundabout on the A27, a country park, land for a school and a community hub.

Also in West Sussex, construction work is underway on the WOW – Worthing Observation Wheel. The 46m wheel will be sited next to the beach in Montague Place. Worthing Borough Council has awarded a three-year lease to deKoning Leisure Ltd, which will operate the wheel between April and October every year, when it will be dismantled for the winter. Similar attractions around the UK have required significant investment to enhance economic development but the cost to Worthing Borough Council is minimal as the land is leased to the wheel operator and owner.

An innovative, potential intervention by Eastbourne Borough Council this month. The Council is considering opening a microbrewery to supply its own bars across Eastbourne and promote tourism. Whether a council can brew beer as competitively as local brewers such as Harveys, however, remains to be seen.