Growth in the South West increased by a notable 0.6% to 2.1% in the year to March 2019, the second highest growth rate 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 respectively. The East of England was the most improved region of the UK with growth accelerating from 0.9% to1.9%. The UK growth rate for the same period was 1.5%.
Unemployment in the South West also fell sharply by 18,000 to 70,000 between January and March; the drop of 0.6% to 2.4% was the best in Great Britain. At 2.4% the region also had the lowest unemployment rate in the country. In comparison the rate in the North East was 5.4% and the UK unemployment rate stands at 3.8%.
In March, average earnings in the South West dropped slightly to £571 per week. London had the highest average earnings of £762 whereas Northern Ireland had the lowest of £513. In the UK average earnings grew by 3.3% or by 1.5% after inflation.
South West average property prices fell by 0.3% to £253,752 during the month which trimmed annual price increases to 1.3%. 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 West had a deficit of £4.8bn. This compared with London which had the highest surplus of £34.3bn. On a per person basis the South West deficit of £868 was the lowest in England. 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 of England 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.
Positive news in Plymouth with the future of a ball-bearings factory has being secured following its sale to German firm HQW. Barden UK had been earmarked for closure with the loss of 347 jobs following a restructuring by previous parent company Schaeffler – which Bardens will continue to supply. Barden has been in Plymouth for more than 50 years and operates from a plant at Estover, producing precision bearings for cars, aircraft, the nuclear industry, missiles and satellites. Also in the city, medical firm Becton Dickinson is building a £2.5m factory extension as part of a £100m investment which will create up to 100 jobs.
In Wiltshire, the aerospace, defence and security products manufacturer Chemring has won two contracts worth c$67m – to supply countermeasures which support the F-35 Joint Strike Fighter – to the Royal Australian Air Force and US Navy.
On infrastructure, the National Audit Office (NAO) estimates the likely cost of upgrading the A303 – including building a tunnel past Stonehenge – at £1.9bn, c£400m more than the original plan. Work is due to begin in 2021 with an expected opening date of 2026. Whilst the route will cut congestion and boost the economy, the NAO says it will only deliver £1.15 in economic benefit for every £1 spent. Excluding a monetary value for cultural heritage – which is included by Highways England in its appraisal – the cost of building a tunnel means that under the standard method for appraising transport projects, this project would only deliver 31p of benefit for every £1 spent.
On the trains, linking the Swanage to Wareham heritage line in Dorset to the national network and restarting regular services has been delayed because the line’s diesel train is being fitted with the modern equipment needed for mainline services such as locking doors, safety systems, radio communication and new wheels. The line was closed by British Rail in 1972, and then partially reopened as a heritage line in the 1990s before the final section was funded by a £5.5m investment by the railway’s stakeholders, Purbeck District Council, Dorset County Council and a grant from the government’s Coastal Communities Fund.
Three significant infrastructure projects in Devon also moved forward. Work has started on a £30m new sea wall at Dawlish which should prevent storms from damaging the railway line which links Devon and Cornwall with the rest of the UK. The project will take nine months including a summer suspension. In Plymouth, the £49m Forder Valley Link road aims to improve travel to the north of the city and will involve a new bridge, additional lanes and cycling and pedestrian routes. Also, the £93m upgrade to the North Devon Link Road is set to begin in November 2020. The improvement scheme will widen a 5 mile stretch of the A361.
On development, a £90m project for 400 new homes, a care home, and new green spaces on land next to Exeter’s Morrisons supermarket have been lodged with Exeter City Council. The development, near to Exmouth Junction, is a long-term brownfield site which has historically been used as a railway goods yard, rail sidings and coal concentration yard. Developers hope the project will annually generate residential spend of c£11.9m, £735,300 in council tax, £732,300 in New Homes Bonus and will create 127 full time equivalent construction jobs.
In Avonmouth, electricity created from non-recyclable waste will power a new £65m plastic recycling plant. The power plant will be fuelled by diverting 320,000 tonnes of waste from landfill and generating 32MW of electricity – the equivalent energy used to power about 44,000 homes. The Viridor site is likely to reprocess up to 60,000 tonnes of plastic a year largely from bottles, pots and tubs. Both sites are expected to open by 2021. In Gloucestershire, the Javelin Park incinerator will soon start taking household waste initially from Stroud and Gloucester. The incinerator will combust 190,000 tonnes of waste a year – providing electricity to power the equivalent of 25,000 homes. The troubled £633m plant has been criticised as poor value for money.
Analysis by the BBC and the Chartered Institute of Public Finance and Accountancy (Cipfa) showed Somerset County Council has the second largest reserves deficit in England and risks running out of cash reserves within four years if recent spending continues.