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A Total Dog’s Breakfast

A Total Dog’s Breakfast

🕔11.Feb 2014

LEP WeekProminent backbench Labour councillor John Clancy says GBSLEP is not about the local, is not focusing on the right enterprises and the partnership boundary has been extended in the wrong direction.

The clue for me was in the title: Local Enterprise Partnership.

Firstly, the Local – the LEP should have been all about Local Enterprises in the Birmingham area. This LEP is not.

Secondly, Enterprise – the LEP should have been about supporting and stimulating new enterprises in the Birmingham area. This LEP is not.

Thirdly, Enterprise Size – the LEP should have focused on Small and Medium-sized Enterprises. These would be the bedrock of any recovery and expansion of private sector business. This LEP is not.

Fourthly, manufacturing and industrial Enterprise – the LEPs should have been at the forefront of rebalancing the national and regional economies towards local industry, not retail and services. This LEP is not.

The LEP has become, I fear, more about sustaining and supporting existing big enterprises and attracting non-local, big enterprises in particular – and of the wrong sorts.

This LEP became much more about attracting and investing in the wrong kinds of enterprise as far as I’m concerned: big retail, big business, big construction, big finance, big service sector. It has signally failed to get anywhere with what should have been its primary aim – getting sustainable, new,  small- and large-scale manufacturing going.

Instead we got the worst of all worlds – the old ideas about what is good for us based on (first!) building office blocks and tearing down buildings and developing physical assets. A total nonsense based on a belief that infrastructure creates enterprise, not people. It’s not business as we know it. The wrong sectors captured it.

That the LEP should have been also been captured by the notion of and the physicality of the Enterprise Zone was the first big mistake.

The LEP should have invested in people and ideas and energy, not physical big stuff. And also not physical, preparatory big stuff.

The money made available to the LEP ridiculously came from Birmingham City Council itself borrowing money it could not afford to borrow on behalf of the LEP (over £60million of debt). In particular, the borrowing was not to get money into local businesses, whether they were old, new or starting up.

This is what it should have been borrowed for. Instead it was to support the Enterprise Zone in the city centre.

Although the Enterprise Zone was based in Birmingham the plans had belts of enterprise associated with it outside Birmingham. But the borrowing was not done outside Birmingham.

The theory was that the Zones and Bands and Belts whilst based in and around the boundaries of Birmingham would create jobs for the entire LEP zone. In which case it should not have been only Birmingham City Council taxpayers and citizens who should have footed the bill.

Again, the focus became regeneration of the centre of Birmingham, which is something those involved clearly only had knowledge and experience of. Instead there should have been a mosaic of enterprise zones across the LEP region and based around sustaining, and growing new, SMEs.

I say ‘region’ but that’s hardly what it served. It looked east, instead of west into the Black Country and beyond. It was, and is, a total dog’s breakfast of an arrangement. It even resembles a dog’s leg, in fact, in its shape.

Borrowing to invest in businesses I see as the most important thing we should be borrowing for. But, I repeat, business investment is about investing in people and ideas, entrepreneurs and workers, not bricks and mortar, steel and concrete.

In Birmingham the investment should have happened across all forty wards, not coalesced into the centre. Big spends on big infrastructure there is what it has become about instead.

And, as ever, the whole shebang is based on future promises of future money anyway. Borrow now against a future stream of income from the zone and the area, which is by no means guaranteed. Tax increments from future financing sounds as dodgy as it ever was to me.

And worse, enticing businesses into a so-called ‘enterprise zone’ from elsewhere is the opposite of what should be done. Displacing businesses from elsewhere with promises of this, that and the other simply displaces jobs, it does not create them.

And there’s the rub. New job creation, new enterprise growth based here in Birmingham and based in the people already here was what it should have been about. New industries (3D printing, for example) could be invested in for Brummie business folk and Brummie workers to get busy in.

Confidence in the enterprise of Birmingham itself should have been what the Local Enterprise Partnership should have been about. This LEP is not.

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