Member Article

We must think of the future of the North East

It was nice to hear last week that the comments I made about the adverse impact of dismantling ONE North East without having a chance to effectively manage the change was confirmed by the National Audit Office, as reported in Friday’s Journal.

But that does not get us anywhere. The Regional Development Agencies are in the past and we really need to get on with the future. That future was charted by the Chancellor in the Autumn Statement on Thursday.

Applying a regional context, we have a long way to go to achieve the economic growth and job creation needed. London is forging ahead in the economic stakes. The North East has traditionally followed but with lower peaks and deeper troughs of economic activity. It is my experience that the property sector also tends to lag about nine month’s behind an economic upturn.

Going around the Christmas drink parties, the discussion is toward a confidence that the region is heading toward an upturn, with most expressing busyness in the property sector and looking forward to a growth in activity next year.

As explained last week, the North East Local Enterprise Partnership (NELEP) is progressing toward a strategic plan and governance through the proposed Combined Authority by spring 2014. Provided that we have a strong marketing context to the plan and implementation, I have a confidence about the future. Any support provided by the Chancellor is most welcome.

In relation to housing, the £1bn of loans to unblock housing development will contribute toward housing need and construction jobs but a government policy of a balanced regional growth plan would be welcome.

Some funding is to be directed through LEPs but more is needed with devolution of housing spend to local authorities, as recommended in the Heseltine Review. As a region we need to grasp the delivery of housing and to relax the tight Green Belt around our conurbations. This will deliver much-needed housing and the financial gain must be used to leverage investment into the more challenging and higher risk development of brownfield land.

We could also do with the government changing the Stamp Duty method of charging from a ‘slab’ system, which we have at present, to a marginal system. This would remove ‘dead zones’ creating a dearth of properties on the market between £250,000 and £270,000.

Occupancy costs of property on business are another crucial matter and the re-occupation relief will help but the rate cap on a £40,000 rateable value will only give a saving of £240.

The greatest thrust of the Autumn Statement seems to be on infrastructure investment. There are several issues for the North East, but the DfT policy for road investment to be predicated on over-coming congestion is one that needs addressing urgently.

As a region we need this to change and be based on economic potential and developed on a business case. We need also to choose schemes that have a greater potential to stimulate regional growth and recovery faster.

This was posted in Bdaily's Members' News section by JK Property Consultants .