Live updates on the 2012 Budget announcement
13:45: Budget reponse “This year’s Budget was mainly about tax, but it’s still good to see that cities, as drivers of the UK economy, were so well represented. Support for superfast broadband, a £150m fund to invest in infrastructure, a boost for housing as well as a commitment to improve transport in the North and review airports in the South, will all make a difference to growing city economies. So too will steps towards giving cities more power over their tax base, as seen in the City Deal with Manchester. But different cities face different challenges in an uncertain economy: while 1 in 100 young people in Cambridge are unemployed, it’s 1 in 10 in Hull. For cities to contribute to national economic growth, the Centre for Cities would have liked to see more place-responsive policies, in particular on youth unemployment, skills and enterprise in the Budget.” 13:17: We won’t know the full details of the National Planning Policy Framework until it’s published next Tuesday. It’s good news that the presumption in favour of sustainable economic development has been retained, as it will help fast-growing places under pressure to expand to build the housing and offices needed for their economies. And if the system is simpler, than that reduces transaction costs for businesses across the country. But the devil will be in the detail, and there are still questions about whether the presumption will help some of the slower-growing cities where planning simply isn’t the problem. 13:12: Youth unemployment is a major issue that needs to be tackled, but in different ways across the country: while 1.3% of Cambridge’s young people are claiming unemployment benefit, 10.1% of Hull’s young people are unemployed. It’s unclear that measures such as loans to young people to start up businesses will be enough to deal with the challenges facing young people in some of our former industrial towns. 13:05: It’s good to see cities mentioned so much in this Budget. We know that cities drive the economy: they contribute 62% of the UK’s GVA. Deals like the Manchester City Deal, which involves the city “earning back” tax where it has generated extra growth, are vital; that’s how the UK’s cities will catch up with their international competitors. 12:58: Enterprise Zones are being expanded – there will be more in Scotland and Wales, and London’s Royal Docks will have enhanced capital allowances. But lessons from the 1980s are that the jury is out on what they will deliver, and whether new jobs will be created or simply displaced from elsewhere. The news that there will be £150m of Tax Increment Finance money is likely to have a bigger impact on growth as it will allow investment in infrastructure required. 12:54: Investing in links between cities – like the links between Manchester and Preston just announced is exactly the way we should be trying to make the most of our cities. It increases the scale of cities like Manchester, and that’s what international investors want to see. It also helps people living in Greater Manchester and Lancashire benefit from a bigger labour market and more jobs. 12:51: It’s good that there’ll be more money for the Get Britain Building Fund – it’s an immediate, short term win for the labour market because of the jobs created by construction, as well as helping Britain’s long term housing shortage. But we still need longer term solutions to deal with the UK’s housing shortage. 12:38: Although the OBR expects the UK to avoid a technical recession and has revised its forecast for growth up, we’re still recovering much more slowly than we did from the last recession in the early 1990s. Four years on from the start of the 1990s recession, unemployment had been steadily falling for more than a year. Four years on from the start of the most recent downturn and unemployment has returned to 2009 levels. This main difference between now and then is that the 1990s recovery was accompanied by much stronger economic growth and, as a consequence, private sector job creation. Read the full 2012 Budget Submission from Centre for Cities:centreforcities.org/budget2012
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