Austerity and Our Local Economies

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2016 National Delegate Conference
29 February 2016
Carried as Amended

The North East is not alone in still feeling the increasing and cumulative effects of austerity since the financial crash of 2008 with continued cuts to public services and jobs. The cumulative effect of a lost decade of investment and wage growth across both public and private sectors is still being felt as the region struggles to revive and inequality grows at all levels, seen in high youth unemployment, food bank usage, museum closures, voluntary sector grant cuts, closing children’s centres and rising mental health referrals, to name but a few.

Where steel and public sector jobs have gone, their replacements are usually lower paid and casualised.

Public and civic investment is vital in our regions and has never been cheaper with low interest rates for public borrowing.

Local Government cuts are severe in the North East, forcing councils back to the mere statutory minimum of service delivery, and sometimes below. Business Rate retention in years to come will not offer much hope to our local authorities and services. The possible extra 2% on Council Tax for social care doesn’t raise much if you have a low local property tax base and low business start-ups.

The Northern Powerhouse must not be empty rhetoric linked to overall budget cuts and a few prestige projects. It needs grass roots investment in public services.

The make-up of Local Enterprise Partnership boards show too narrow a focus on partnerships between business representatives, higher education establishments and local authority leaders, which leads to the exclusion of other important social, economic and environmental partners including trade unions.

The so called ‘National Living Wage’ of £7.20 an hour for the over 25s will benefit the North East but it is not a real living wage, nor a panacea to tax credit cuts, rent rises and other pressures on the cost of living.

Conference calls on the National Executive Council to campaign for:

1)An end to public sector job cuts and a genuine regional regeneration programme with public financial investment being used as the ‘seed corn’ to grow regional economies and provide jobs, based around a programme of supporting large and medium-scale infrastructure programmes (such as developing local rail and rapid-transit networks) and large-scale building of desperately-needed social housing by local authorities;

2)An end to the ‘right-to-buy’ provisions imposed upon local councils and housing associations;

3)Fairer funding formulas, property tax systems and a ‘Robin Hood Tax’, which represents a relatively small tax on the financial sector that could generate billions of pounds annually to fight poverty at home and abroad;

4)Support for the UK Steel industry and funded regional growth plans.