The State of Britain

WM sees the biggest increase in state spending in the UK, the region’s house prices rise the fastest in England and the UK’s largest ‘regeneration project’ approved

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In the ONS’s estimate of regional public spending and regional tax revenues in 2019, the WM had a deficit of £14.9bn, a larger shortfall than the £12.9bn recorded in 2018. This compared with London, which had the highest surplus of £38.9bn.

On a per person basis, the WM’s deficit was £2,526, higher than the £2,209 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; all the other 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 the WM was £73.8bn or £12,503 per head, the increase on the 2018 figure of £69.4bn was the largest in the UK. 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.

The WM collected £58.8bn 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 the WM increased by 11,000 to 128,000 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 75.4% in the WM. UK employment was estimated at 76.3%.

WM average property prices increased the most in England during November 2019, the 1.7% uplift to £204,238, increased annual growth to 4.0%. In comparison, UK prices increased by 0.4% to £235,298 an annual growth rate of 2.2%.

On transport, the Office of Rail and Road (ORR) is investigating Network Rail over its poor service on routes used by commuter favourite West Midlands Railways. 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 was 57%, this compares to the national average of 65%.

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 suggests the total could reach £106bn. At this cost the decision whether to proceed or not will be taken at Prime Ministerial level next month.

Work to extend the West Midlands tram network from Dudley to Wednesbury, incorporating 17 stops, has started. The Midland Metro, which currently connects Birmingham and Wolverhampton, is expected to carry passengers to Dudley and Brierley Hill by 2023.

The first phase of the project is to construct a £4.3m wall at Castle Hill. The tram extension in Birmingham opened from Grand Central station to the city’s library in December.

Plans for the UK’s biggest ‘regeneration project’ have been approved. The size of Birmingham’s Alexander Stadium for the 2022 Commonwealth Games will quadruple. Permanent capacity will increase to 18,000, with temporary seating taking it up to a limit of 40,000 spectators.

Birmingham was named as the host city for the games in December 2017, and it will be the UK’s costliest sporting event since London 2012. The 11-day games are budgeted at £778m, with £184m paid by Birmingham City Council and partners.

On infrastructure, funding for the Hereford bypass and southern link road has been withdrawn by the Marches LEP.  

The route of the £150m Hereford bypass and southern link road was approved in 2018, but a change in political control at the council led to possible alternatives being considered including building new bridges and a light railway on the Great Western Way.

As well as withdrawing the £27m the LEP is also seeking to claw back £3.8m already spent on the project.