Enterprise Zones: Locations of First Four Unveiled
Businesses based in Liverpool Waters, London’s Royal Docks, Manchester Airport, and Nottingham’s Boots campus will benefit from lower taxes, simplified planning rules and superfast broadband, after the first four Enterprise Zones were announced by the Government.
The Chancellor revealed in the Budget that 21 Enterprise Zones would be created across the country in the areas of greatest need and potential.
Vince Cable, business secretary, said:
“We will work closely with the local enterprise partnerships (LEPs) to identify new ways we can support them on developing the Zones, especially on issues like enhanced capital allowances and securing inward investment.”
All Enterprise Zones will offer a business rate discount worth up to £275,000 over five years, as well as simplified planning rules. The Government is also working with individual LEPs to establish suitable benefits for their area, such as enhanced capital allowances for plant and machinery.
However, National Federation of Enterprise Agencies chief executive, George Derbyshire, said that there was a danger there would be a repeat of the mixed success of the 1980s enterprise zones.
“While some of the 1980s enterprise zones were successful – Canary Wharf, for example – others were less so. There is an ongoing debate about the extent to which enterprise zones create jobs or simply move them across an arbitrary line. There are also examples of property development which was started for financial reasons rather than to meet a genuine business need.”
Derbyshire added that to be successful, the zones must be part of a wider economic development strategy.
“The Government needs to consider whether the Enterprise Zones are big enough, whether they have the communication links and transport links, and the business infrastructure to support them. They also need to ensure that the LEPs are fully involved and integrated and in support of the zones.”
However, Derbyshire said that the Enterprise Zones selected so far were based in the areas of the country that have “suffered disproportionately”.
A Department for Business, Innovation and Skills (BIS) spokeswoman said that LEPs have been asked to draw up plans to show how they would “minimise displacement and dead weight” as part of their proposal to host an Enterprise Zone in their area.
The exact location of seven more enterprise zones is due to be announced shortly.
In addition, the Government has launched a competition for LEPs to bid for ten more enterprise zones. The winning bids will be announced in the summer.