Friday, 29 October 2010

Investing in the future

With the painful decisions on public spending now done, it is time to start thinking about how we can create new jobs in the future. One of the keys to creating new prosperity in the long term is strengthening education and it’s no surprise that spending on schools was protected in last week’s Spending Review.

There is to be a new Pupil Premium to ensure that more money goes to those schools supporting children from the most deprived areas so that they can employ the best teachers. There was also hope for those Schools in Camborne and Redruth who earlier this year had started working on plans to build new schools. The so called "Building Schools for the Future" programme introduced by the last government was extraordinarily wasteful. Schools were expected to spend millions on consultants before they could lay a single brick. It was costing twice as much to build a school in Britain than it was to build a school in Ireland and that means the money was not going very far. The scheme had to be scrapped.

But last week George Osborne announced a £16 billion fund to refurbish or rebuild 600 schools across Britain over the next few years. That could go a long way and makes far more sense than the old scheme. He also stripped away all of the ring fencing on capital grants to schools so that they will have far more control over how money is spent in their school. One of the things that infuriates head teachers at the moment is the fact that they have to go without important things they need because someone else has decided to spend their money on something they don't really need. Head teachers have been telling me is that when money is tight, we should just let them make the decisions about how it is spent.

The new government wants all parents to have the sort of choice that today only money can buy and this school term, the first wave of schools became academies, were set free from council control and given the money to manage their school as they see fit. The rest will follow in the years ahead. These newly independent schools will be free to all and publicly funded but they will have the freedom that today only private schools enjoy. They will have control over their curriculum and will be able to set terms and conditions for teachers so that they can reward and retain the best staff. The single most important factor determining school performance is strong leadership from the top and good teachers but all too often, good teachers leave the profession early and we need to do more to retain them.

Competition is good and the one thing that I have detected in our local schools is a healthy rivalry that goes beyond the sports pitch. We should harness it to give our children the best possible start in life.

Wednesday, 20 October 2010

The spending review

By the time you read this, we will know all of the details of the Comprehensive Spending Review and months of number crunching will finally have come to a conclusion. There will be announcements on a number of substantial decisions but there will also still be some local projects where decisions are postponed until later in the year.

There is no doubt that we need to get to grips with the scale of the debt that Britain currently has. Last year the government spent some £150 billion more than it received in taxes. That is more than the entire NHS budget and all of it had to be borrowed from other countries. As a result of all the borrowing that has been piled up over the last few years, next year this country will be spending more money on interest charges than it does on schools. You can’t keep borrowing money forever. In the end it catches up with you and the longer you leave it, the harder it is to put things straight. We have to bite the bullet now.

But I am also very conscious that the tough decisions taken this week will have a real impact on people’s lives. There will be public sector job losses, some projects cancelled and there will be cuts to some benefits.

No one relishes the prospect of job losses and I wish there was another way through. But given that there isn’t, I think there are two key things the government needs to get right. First is the importance of fairness. I think it’s very important that we share the pain and that no single group of people are singled out and expected to carry more of the burden. That is why in the budget George Osborne announced some tax rises as well as spending cuts. It is why the government has left the higher rate of tax at 50 percent, increased Capital Gains Tax and it is also why they have taken Child Benefit away from the highest earners who pay the top rate of tax.

Secondly, it is crucial that we do all we can to help those who lose their jobs or are affected by the cuts. The government has set up a £1 billion Regional Growth Fund to help develop new businesses and private enterprise. We need to support people who want to set up on their own and be their own boss. We also need to redouble our efforts to help people get off benefits and in to work. There are thousands who are trapped in poverty by welfare dependency and often it becomes a culture that spans generations. I have seen some really good projects that help break that cycle with effective mentoring given over a long period of time to instil a work ethic in people and give them the skills and the self confidence to get a job and earn a living. We need more work like that.

Friday, 1 October 2010

Cornwall’s LEP

Cornwall looks set to get government approval for a Local Enterprise Partnership covering Cornwall and the Isles of Scilly to replace the old Regional Development Agency which went all the way up to Swindon. I think the new organisation offers us a chance for a fresh start on local economic policy.

I have always believed that smaller organisations can be more effective than larger ones because they are more agile and responsive and a small group of talented people can break through, take control of the reins and really get things done. One of the problems with the old RDAs was that they were too big, covered too large a geographic area and often cut across accountable bodies like Councils when it came to their priorities. Many businesses also found them remote and out of touch.

An LEP covering Cornwall and the Isles of Scilly starts with some plus points. It is much smaller and therefore more agile than the RDA and there are fewer councils to contend with which makes it easier to take and implement decisions. But the big test is still to come. We need to make sure there is strong business leadership on any new LEP.

Economic regeneration is one of the most important issues in this area. Since the loss of the mining industry and iconic firms like Holmans in Camborne and J&F Pool in Hayle, we have struggled to regain our footing and incomes have fallen well below average. I want to see that reversed. We need to develop new industries and build the wealth that will create new jobs in the private sector.

CPR Regeneration has made a good start locally under the leadership of David Brewer and Nigel Tipple. The culmination of six years work should come to fruition over the next couple of years with the Heartlands project at Pool and the regeneration of Tuckingmill which will probably even include the reopening of South Crofty mine.

But we are entering an era where there will be less public money around for capital investment and so the lead will need to come increasingly from the private sector. We need more people with a bright idea to have a go, set up their own business and, hopefully, make money. Helping people get off the ground with their business idea must become the main focus. The sorts of people who in the last decade might have worked for government agencies like "Business Link" advising businesses what to do are the sorts of people who must now fly the nest and do it themselves. Our economy depends on it.

The problem in recent years is that there have been a plethora of government quangos tripping over one another to tell businesses what they should be doing. We need to turn the tables so that real life businesses tell the Local Enterprise Partnership what they need and then together they make it happen. Time will tell whether we get it right.