The main points of Sir Albert Bore speech to Chamber of Commerce Business Breakfast (21 January 2015)
- 2015 will be a critical year for both the City Council and the city so this is a useful opportunity for us to discuss the year ahead.
- To kick off the discussion I want to spend a few minutes summarising the budget position of the City Council and the big changes that we will be taking forward in 2015 and then to highlight some key points about the Birmingham and Greater Birmingham economy.
The financial situation of the City Council
- So to begin with the challenges facing the City Council, as you all know we are facing huge financial difficulties. We have had to find a further £116m of cuts for 2015-16 on top of the £460m we have already cut since 2010.
- Based on current government plans and spending pressures, we expect to find further new cuts of around £100m in each of the next two years as well. We estimate that by then we will have made cuts equivalent to around 60% of the money we had control over how to spend in 2010.
- The budget consultation was launched on 10 December and closed last week.
- Faced with very difficult choices, it is inevitable that the non-statutory services get cut the most. Sadly we are often making false economies as we end up cutting things that really matter to the future and shunting costs onto statutory services and into later years.
- Despite this I have been determined to protect as far as possible the work we do to support business growth, inward investment and regeneration.
- Public services are vital to the city’s future prosperity, which is why the cuts are an important issue in economic as well as social terms. But without a strong economy the city and its communities have no future.
The importance of partnership working
- Given this situation, it is more important than ever that we work together to find imaginative ways of providing economic services.
- The Combined Authority is also part of that story. We will have to wait until after the election for a decision from Solihull, but I am confident that Coventry will make a formal decision before then.
- I am determined that we will be able to put forward at least outline proposals for the new authority before May, so they are ready for the new government to take forward.
- This is not really about governance structures though – it’s about getting a better deal for the West Midlands – a deal that gives us control over key economic and transport functions and a pooled budget to support growth.
- Two of the priorities will be transport investment and raising skill levels, but I want the business community to be fully engaged in defining that ‘ask’ of government and our shared vision for the future of the Greater Birmingham economy.
- We must make sure we put that in place by the end of the year as a high priority.
- I would also like to hear your ideas about how can we extend private sector involvement and support for marketing, inward investment and other economic activities and create a stronger genuine partnership to support growth.
- This will increasingly need to be done at a city region level, but even with pooled resources across the councils, there will not be enough resource to achieve this without more private sector support.
- Where we achieve this we can all see it works well – for example in the Business Improvement Districts, in our support for European programmes that are investing to help businesses grow and innovate, in the work of the LEP. Partnership has got to be the way forward.
A year of change at the City Council
- Despite these pressures, we will be bringing forward radical plans for change at the City Council that we have been working on over the last year or so.
- As I have often said local government will have to change radically in the years ahead. Along with the other Core Cities, we have argued for reforms that would mean we can deliver better outcomes with less money and we are focused very much on the election campaign in the hope that the next government might deliver them.
- But we will get on with change in any case, based on the three-level approach I have set out – what we call the Triple Devolution model.
- This will mean a focus on doing things differently at the city region, the city and the neighbourhood or district level.
- We have broadly accepted all the recommendations of the Kerslake review – many of which confirmed issues we were already working to address.
- Our plan to respond to the review will go to Cabinet next month. But that is only the start of the process, not the conclusion. Over the year there will be consultation and engagement with councillors, residents, community organisations, businesses and other stakeholders on the detail of the changes.
- For example we will also be publishing the consultation document for our community governance review next month.
- The boundary commission review will look independently at the ward boundaries in the city and the number of councillors per ward and there will be a wide consultation on their proposals as well.
- I hope the business community will be particularly engaged with our work to develop the vision and strategy for the city region but also our new partnership to take forward the City Plan, setting out the overall vision and priorities for Birmingham.
- In the area of education and skills we will be working hard to ensure that the Birmingham Education Partnership delivers a new relationship between the council and schools and that the links between business and schools can also flourish.
Great prospects for the Greater Birmingham economy
- On the wider economic picture, the year ahead looks like a very exciting one in which we will see the city building on recent excellent performance.
- We saw a 57% increase in the number of inward investment projects last year and exports from the West Midlands were second only to the South East, reaching Â£21bn by September.
- Unemployment and employment rates are now back to the level seen before the recession in 2008 and employment increased by 4,000 in the last quarter of 2014.
- The latest data show that Birmingham now has the highest growth rate of any core city. GVA increased by 4.2% between 2012 and 2013, nearly three times the national rate of 1.6% and double the rate in Manchester.
- We also saw 4,000 new business starts in 2012 (the latest figure available) and a 32% increase in international visits between 2012 and 2013.
- This performance will be reflected in many important developments during 2015. We can look forward to the start of work on the Paradise Circus redevelopment, the opening of the new metro line from Snow Hill to New Street, the completion of New Street Station and the opening of the Grand Central shopping centre, including John Lewis.
- The recent news that Jaguar Land Rover will create over 1,000 new jobs by making their new SUV in the region is also a great start to the New Year.
- I think we can look forward to the city region consolidating its progress as a centre for advanced manufacturing as well as making steady progress on the expansion of other high value sectors such as digital and creative (where we now have 4,000 companies and over 20,000 jobs), ICT and medical technology.
- We face challenges as a council but we will overcome them.
- None of the issues raised more recently is of the same level of importance as the safeguarding of children – our number one priority, whatever else has to be dealt with.
- But we also remain committed to playing our part in supporting growth and jobs in the city.
- We have a good tradition of partnerships, perhaps especially with the business community to open up new opportunities for the city.
- It is more important than ever that we all work together across the city region as civic leaders and business leaders to overcome the challenges and to grasp the opportunities that 2015 will bring.