LJMU expert warns against public sector cuts

18 January 2010

A new influential report by LJMU's Michael Parkinson (pictured left) warns that regeneration projects vital to the economic growth of the UK could be hindered by a lack of investment from the private and public sector. 

The report calls for further reforms to financing and delivery of those projects with the strongest potential to deliver economic gain from new jobs, industries and renewed communities.

The report – "The Credit Crunch, Recession and Regeneration in the North: What’s Happening, What’s Working, What’s Next?" – was produced by Michael Parkinson CBE, Director of the European Institute for Urban Affairs at LJMU, and commissioned by the Northern Way.  It shows that a likely ‘public sector recession’ could jeopardise the continuance and development of many projects vital to economic growth in the North of England.

The report expands on and updates the lessons in Professor Parkinson’s previous report, published a year ago for the Government.

The Government, Regional Development Agencies and local authorities have stepped in effectively to keep momentum going where possible.  But Parkinson warns that early cuts in public sector capital could now choke off the recovery in those communities which most require investment, but where the private sector is not yet able to return in strength. 

Michael Parkinson concludes: "A wide range of evidence paints a consistent picture. After a very good period, much of the North has been badly affected by the crunch and recession.  Many good people are doing many good things on the ground to limit the potential economic, social and physical damage to places in the North. We have shown many examples of what is possible even in adversity. But often their levers are limited and their resources declining.

"It is crucial that policy makers nationally and locally do all they can to sustain the gains that have been made in the North in recent years and to limit the potential damage threatened by the worst credit crunch and deepest recession in living memory.”

Welcoming the report, Hugh Morgan Williams, Chairman of the Northern Way Steering Group, said: "This report is a compelling and inspiring call to action. It couples realism about the scale of the challenge and the tough choices we face, an understanding of the serious constraints facing private sector developers and investors, with practical examples of how we can move forward. It includes important messages for Government, as well as organisations working on the ground. Above all, it encourages us all not to give up, but to redouble efforts and renew our commitment to a better economic future for all."

Amongst other coverage that the report had in the media, Michael was interviewed for Radio 4's Today programme and the conclusions of the report were explored in the Financial Times.

The full report may be downloaded here.