The value of North East Enterprise Zones queried, more money for the Borderlands Growth Deal and depopulation concerns in North East coastal towns

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Unemployment in the North East was unchanged at 71,000 between February and April but at 5.6% it was still the highest in the UK. At 2.6% the SW of England had the lowest rate in the country. The UK unemployment rate stands at 3.8%.

After North East average property prices surged by 5.0% in April, this month prices reversed by 1% to £127,885, which meant annually prices dropped by 0.7%. In comparison, UK prices increased by 0.1% to £229,431 during May, which reduced the annual growth rate to 1.2%.

In its review this month of the 38 Local Enterprise Partnerships (LEPs) – the private sector-led partnerships between businesses and local public sector bodies that support local economic growth – the Public Accounts Committee of the House of Commons found that from 2015-16 to date; £9.1bn of taxpayers’ money has been awarded to LEPs through three tranches of Growth Deals. The north of England, with 11 LEPs, has received most of the funding at £3.4bn (38%), the East of England, with three LEPs, has received the least with £703m, and London, with one LEP, has received £435m.

The Ministry of Housing, Communities and Local Government considers the population of an area as well as the strength of the LEP’s strategic economic plans and projects when deciding Growth Deal allocations. There are no overlapping LEPs in the North East which means the regions LEPs will be able to bid for funds from the Government’s proposed Shared Prosperity Fund, which will replace EU structural funding after Brexit. The North Eastern LEP has received £380m, the 6th most in England, whereas Tees Valley has secured £126m, the 28th in England. The Ministry does not to evaluate the Local Growth Fund which means it has no understanding of what impact spending through LEPs has on local economic growth. The latest growth figures for the North East from ESCoE showed the second lowest growth in the UK at 0.8%.

The 24 Enterprise Zones designated in England in 2011 to improve economic growth had created 17,307 jobs by 2017 instead of the forecast 54,000 jobs by 2015. BBC-commissioned research conducted by think tank charity Centre for Cities also found that in two areas the number of jobs had fallen. Enterprise zones offered cheaper business rates, superfast broadband and lower levels of planning control. According to the research only 63 jobs were created in the North Eastern Enterprise Zone, the lowest job creation in England, with 777 in the Tees Valley Enterprise Zone. The cost of the scheme is disputed, with The Ministry of Housing, Communities and Local Government claiming £101m, £215m less than the BBC’s estimate of £316m+. The Ministry also disputes the methodology used in the research.

Northumberland and the other four cross-border councils and the Scottish and UK governments have signed the heads of terms for the Borderlands Growth Deal. The two governments have confirmed funding of up to £350m and agreed to uplift the deal with an extra £45m. Projects under consideration include a feasibility study into extending the Borders Railway beyond Tweedbank to Carlisle., Carlisle Station Gateway, Chapelcross Energy Park near Annan, Berwick Theatre and Conference Centre and the Mountain Bike Innovation Centre in the Borders. Second phase projects might include a play village at Alnwick Garden, the Star of Caledonia landmark sculpture at Gretna and a dairy innovation centre in Dumfries and Galloway. The funds will be deployed over 10 years by the Scottish government and over 15 years by the UK government.

BBC analysis of ONS projections has found thirty seaside towns could see a fall in the number of residents under the age of 30 by the year 2039, with the biggest decline in the north of England. Northumberland could see a fall of 11%, the third largest decline in England, with Hartepool and Redcar seventh and eighth. Coastal authorities in the south such as Bristol could see a 15% rise in the number of children and young people. The Coastal Communities Fund has invested £218m in 354 projects across the UK since 2012 with the latest figures showing 27% or c£25m deployed in the South West and 12% or £15m in the North East. In the spring, the House of Lords Select Committee on regenerating seaside towns found that Brighton and Bournemouth have shown that coastal areas can successfully regenerate and that the Government should secure town deals for other deprived seaside areas.

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