The State of Britain

The South Yorkshire devolution deal agreed, Northern Rail nationalised and Sirius Minerals salvaged

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In the ONS’s estimate of regional public spending and regional tax revenues in 2019, Y&H had a deficit of £11.3bn, a lower shortfall than the £11.9bn recorded in 2018. This compared with London, which had the highest surplus of £38.9bn.

On a per person basis, the Y&H’s deficit was £2,063, lower than the £2,188 recorded in 2018. London had the highest surplus of £4,369 per person whereas Northern Ireland had the biggest shortfall at £4,978.

The only areas of the UK to run surpluses were London, the SE of England and the East of England. The West Midlands and the North East were the two regions in the UK to increase their net fiscal deficits over the year; the other seven regions reduced their shortfalls.

At a national level, the UK had a deficit of £623 per person which splits into deficits of £68, £2,713, £4,289 and £4,978 for England, Scotland, Wales and Northern Ireland respectively.

Public spending in Y&H was £67.2bn or £12,278 per head, an increase on the 2018 figure of £65.9bn. London had the biggest spend of £123.9bn or £13,826 per head whereas Northern Ireland had the lowest at £27.9bn or £14,821 per head. Total government spending was £853bn or £12,835 per head.

Y&H collected £55.18bn in taxes in 2019. London contributed the most to the Exchequer at £161.9bn, compared with the lowest contribution of £18.5bn which was from Northern Ireland. Overall the state raised £811.3bn or £12,213 per head in taxes an uplift of £34.1bn or £461 per head compared with 2018.

More data from the ONS showed unemployment in Y&H increased by 9,000 to 117,000 between September and November 2019; the increase of 0.3% took the overall rate to 4.3%, the joint second highest in the UK. Northern Ireland had the lowest rate at 2.3% with the UK rate at 3.8%.

The South West had the highest employment rate at 79.8% which compared with 73.4% in Y&H. UK employment was estimated at 76.3%.

Y&H average property prices fell the most in the UK during November 2019, the 1.0% drop to £165,642 reduced annual growth to 2.6%. In comparison, UK prices increased by 0.4% to £235,298 an annual growth rate of 2.2%.

Four years after it was proposed, Barnsley, Doncaster, Rotherham and Sheffield councils along with Sheffield City Region, have agreed to move forward with a South Yorkshire devolution deal. The Sheffield City Region mayor’s remit will cover transport, strategic planning and skills, plus £900m over 30 years. Barnsley and Doncaster had favoured an all Yorkshire deal but this was vetoed by the government.

Anglo American has agreed to buy North Yorkshire based Sirius Minerals, owner of potentially the world’s largest mine for polyhalite, a naturally occurring fertiliser which is used in agriculture. The c£405m deal could safeguard thousands of jobs after the future of the mine was threatened after Sirius abandoned a $500m fundraising.

On transport, the Office of Rail and Road (ORR) is investigating Network Rail over its poor service on routes used by commuter favourites Northern and TransPennine Express. Network Rail owns and operates rail infrastructure in England, Wales and Scotland.

The ORR said the proportion of scheduled train stops made on time in the last 12 months up to 4 January by Northern was 55% and 41% by TransPennine Express. This compares to the national average of 65%.

Early in January, Transport Secretary, Grant Shapps, announced he was evaluating a proposal from Northern Rail for options for continuing its franchise after the minister said the firm had the finances to continue only for a number of months. Then he surprisingly followed through and nationalised the firm, which consequently threw the Transpennine franchise into sharper focus.

On HS2, the Department for Transport and HS2 Ltd did not allow for all uncertainties when estimating initial costs the National Audit Office (NAO) has said. In 2015, HS2 was due to cost £56bn but a leaked government report suggested the total could reach £106bn. At this cost the decision whether to proceed or not will be taken at Prime Ministerial level next month.

Administrators Deloitte have said 61 jobs will be lost in Scunthorpe, after they could not find a buyer for iron and steel castings producer the Bondshold Group. The firm was established in County Durham in 1868 and only two years ago was one of the UK’s fastest-growing for international sales.