LIVERPOOL BUSINESS WANTS END OF POWER BATTLE

 

An agonised call for the elected mayors of Merseyside to stop their power battles and get on with promoting the city region was made at a Downtown event in the city this week.

Many of the movers and shakers in the area were kind enough to give their time to look at the city’s development in the ten years since Capital of Culture and what the next decade has in store.

The overriding desire was for Liverpool City mayor Joe Anderson and City Region mayor Steve Rotheram to end their rivalry, agree on who does what, and get on with attracting business and tourism to the area.

The main frustration focuses on the many agencies that are doing bits and pieces to attract jobs and visitors. The demand is for one point of contact, particularly for tourism. The consensus was that this is a job for the city region. Acknowledging that Liverpool is the brand, it was felt that the city region should have this strategic role.

The way in which successive governments have devolved power in the UK is partly to blame. At the Downtown meeting, it was pointed out that the Scottish Government and Welsh Assembly could put major funding into attracting business and tourism. Aberdeen and Cardiff are building new conference centres on the back of that. In England, limited power and money has been given to a complex model of Local Enterprise Partnerships and Combined Authorities. In Merseyside and Greater Manchester, the structure of elected city regional mayors over the top of the proud cities of Manchester and Liverpool is a recipe for rivalry. There are some signs of tension in Greater Manchester but the ten districts generally rub along together. Merseyside on the other hand has had a controversial history at local government level with Wirral and Southport wanting to break away, not to mention the Militant era. The business community had hoped all that was well in the past. Liverpool is transformed compared to twenty years ago but this model of city and city region mayor couldn’t have been better designed to revive the old dysfunctional problems.

Added to the structural problems we have two strong personalities. Joe Anderson, passionate for his city, has done great work since 2010 but he wanted to move on to the wider city region stage. In his way was his old friend Steve Rotheram. A way out would have been for Joe to take over from Steve as MP for Walton. That elegant solution was blocked by Unite The Union who wanted their man in Walton.

Now business people in Liverpool are confused about the powers of both mayors at a time when they know that more will be expected of them in terms of promoting jobs and tourism as the cuts continue to bite in the public sector.

The Downtown event concluded that the next ten years are going to be harder after the rapid progress of the last decade. Specific attention was paid to the continuing problems of accessing the city centre from the M62 and the need to fill hotels during the week. In this respect the city seems to have an opposite problem to many other places who find attracting weekend guests a challenge.

One of the most striking views at the Downtown meeting was that, in respect of tourists visiting Britain, the national image was being tarnished by Brexit. It was thought this could be an opportunity for the Liverpool City Region to promote itself separately.

Let’s hope the mayoral problems can be sorted out because the meeting agreed that the Liverpool City Region with that to-die-for waterfront, friendly people and the enduring power of the Beatles gives it potentially great prospects for the future.

Follow me @JimHancockUK.

 

 

BIG JOE AND TOP MAN TONY FACE CHALLENGES.

 

BRINGING DOWN JOE.

The actual elections for the Mayors of the Liverpool City Region, Greater Manchester and possibly Leeds, won’t be held until next year. However in effect the people who are likely to occupy these posts will be settled this summer. Labour has an iron grip on our big northern cities and unless a spectacular independent candidate comes forward, whoever Labour members choose, will win.

The party’s choices will be made very soon. Nominations close on June 10th and the results will be announced on August 4th. Whoever thought it was a good idea to run these selections when the European Union Referendum was on needs their head examining. Labour Party members should be concentrating on getting out the Remain vote amongst its supporters. Without them the referendum could be lost. I guess it reflects leader Jeremy Corbyn’s lack of enthusiasm for the Remain campaign.

However the battle for the Labour nomination has been truly joined. The Shadow Home Secretary Andy Burnham declared this week for the Greater Manchester job. Meanwhile in the Liverpool City Region, 2 MPs Steve Rotheram and Luciana Berger are set to throw down the gauntlet to Big Joe Anderson. There are also suggestions that Barry Grunwald, the leader of St Helens, might try and rally Labour members who want a candidate from outside Liverpool.

Joe Anderson has just started his second term as elected mayor of the city of Liverpool. He got a glowing report on his first period in office from the boss of the Heseltine Institute, Professor Michael Parkinson. However not everyone shares the academic’s views. Critics believe Joe brings a “my way or the highway” approach to the office. They worry about his ability to reach out to the people of Wirral, Southport and St Helens. They remember his petulance when Phil Davies, the leader of Wirral, was originally chosen as chair of the Liverpool City Region instead of him.

There has been a sense of inevitability about Anderson gliding from one mayoralty to the other and this is what Rotheram, Berger or Grunwald will have to combat.

Grunwald is quite a character, inheriting the feisty tradition of his predecessor Marie Rimmer. If he stands he will need to work hard to get name recognition across the city region, but he may be able to play on the fear that a Liverpool politician won’t represent the interests of the other councils.

Joe Anderson is now likely to have to battle with two MPs in the city. Steve Rotheram is the amiable MP for Walton and was a popular traditional mayor of the city some years ago. He has family and work connections with Knowsley, St Helens and Halton and is close to Andy Burnham. They would form a powerful alliance for a North West version of the Northern Powerhouse. Efforts may be made to depict him as a Corbynista. He is the leader’s Parliamentary Private Secretary but Rotheram nominated Burnham for leader and will want to portray himself as a good Labour man first and foremost.

Merseyside politics is very male and a female elected mayor would send out the sort of positive messages that Sadiq Khan’s election in London has done. Wirral South’s Alison McGovern was thinking of standing but is heavily identified with the Blairite Progress movement and is unlikely to run. So what about Luciana Berger? She is bright and personable but will have to deal with the, no doubt unfair, feeling that she is a posh outsider from London.

BURNISHING BURNHAM.

Sir Richard Leese recently expressed his disappointment at Tony Lloyd’s tenure as interim mayor of Greater Manchester. It is a blow for Lloyd as he seeks the post permanently. Leese is now believed to be backing Andy Burnham.

The Shadow Home Secretary’s decision to enter the contest is significant. He has Big Beast status in this municipal contest but it has caused dismay among some Labour supporters for what it says about Labour’s chances of winning the 2020 General Election. Burnham has decided that the only way he can be effective is to run Greater Manchester with no chance of becoming Home Secretary. He represents Leigh and so is not from the Manchester City elite. But will he be any match for the Bernstein/Leese partnership, the powerful Chief Executive/ Leader pairing that has dominated for 20 years?

The other candidate, Ivan Lewis, the Bury South MP, has made it clear that he thinks the devolution agenda has been too Manchester focused and concentrated on economic priorities at the expense of social ones.

It all means a high summer of high drama for Labour Party members in our big conurbations.

 

WILL BUSINESS RATE REVOLUTION HELP FIRMS?

 

 

BUSINESS RATE REFORM.

Over the next few years businesses across the North could be set to benefit from a major revolution in the way that councils are funded.

By 2020 central funding of local government through the revenue support grant will be replaced entirely by business rates income. At the moment councils keep half the business rates collected in their area. The uniform business rate, set in Whitehall, will be scrapped and the Combined Authorities around Manchester and Liverpool will be able to increase the tax, but only if business agrees.

But in the new regime local councils will be able to reduce business rates too, giving the opportunity to encourage new firms into their area, boost growth and increase their rates income. This is certainly the intention of the Chancellor who is behind this change. However there are a couple of snags. Councils will have to carefully balance the impact of new firms moving in and swelling their coffers, attracted by competitive business rates, and the pressures on their spending on services like adult care.

The other problem is that all this may widen the North South divide. While it will be relatively easy to attract businesses to move into council areas in the south, further north it is a different story. Calculations have been done about the impact of the new regime in the North. These show what proportion of the national share of business rates an area would need to retain to replace the current central grant. Scores below 100% mean an area will cover its lost grant. London scores 52% whereas the North West score is 104% Relating these “self sufficiency” scores to specific councils makes even more dramatic reading. While Westminster is quids in because it can cover its lost grant with just 8% of its business rate, Knowsley scores 241% and would experience a massive shortfall of income. Even within the North there are sharp contrasts with Trafford on 38% whilst Wirral is on 187%.

Safety net mechanisms will be put in place to even out some of the disparities. Next month’s Budget is likely to reveal the details of how it will be done along with the outcome of the government’s review of business rates. It’s expected to confirm that rates will still be linked to property values.

The government’s overall intention is that councils should be incentivised to boost their business rates by competing to attract firms in their area.

FAREWELL SHIRLEY.

I see the former Crosby MP Shirley Williams has retired from the House of Lords. Roy Hattersley did the same recently. They were both politicians of the highest quality in the Labour governments of the sixties and seventies. Shirley Williams should have been our first woman Prime Minister.

It says a lot about them that they think it is time to retire with dignity, although I think they both still had a great deal to contribute to the House of Lords.

 

FED UP WITH THE ELECTION ALREADY?

 

 

FOUR MONTHS OF THIS?

 

As people lie in ambulances waiting for treatment, the sound of squabbling politicians rings in their ears.

 

If it’s not the NHS, it’s the economy. We got four or five rebuttal and counter rebuttal documents from the Conservatives and Labour on Monday about each other’s spending plans.

 

The electorate is already mightily disillusioned with the Westminster game. Four months of this will not just have them turning off in droves, it will make them angry.

 

Political reporters have already been overusing the phrase “the election campaign got under way today”, when we know that there will be multiple launches around the spring party conferences and when Parliament is dissolved. Oh for the return of the short sharp campaign. There is a view that people generally form a view two years out from an election. It is difficult to achieve significant changes in opinion amid the sound and fury of the last few weeks before polling day. To inflict this early period of claim and counter claim on a weary electorate is a mistake.

THE YEAR AHEAD FOR BUSINESS.

 

For business, the approaching election means the thing it hates most, uncertainty. The possibility of a change of government might mean that investment plans will be put on hold. This is compounded by the prospect that forming a new government might take weeks and involve multiple parties. Discerning what that will all mean for taxation and business incentives is very difficult, hence the Prime Minister comes up with his plea for continuity under the Conservatives.

 

But away from politics there are a number of other business related questions for the year ahead. How much longer are the workers going to settle for 1% pay rises and zero hours contracts? With unemployment dropping and the economy improving, are we going to see more robust demands for pay rises? These may particularly come in the private sector where there is some evidence of skills gaps developing. Public sector workers may be less likely to take part in a wage push because remorseless cuts are set to continue whoever is in power.

 

AN UNCERTAIN WORLD.

 

Uncertainty at home and uncertainty abroad. The slump in the oil price in 2014 took everyone by surprise. Whilst it provides everyone with lower costs in the short term, what it is telling us about the health of the world economy is another matter.

 

The American economy is surging ahead but the Euro zone’s performance continues to be an embarrassment for those of us who want it to succeed.

The Russian economy is tanking because of the oil price and sanctions, but how will Vladimir Putin react? Will he bow to the pressure or stoke up the fear that Mother Russia is under attack from the West.

 

A few years ago China’s rapid expansion sent raw material prices soaring. Growth has slowed. What effect will that have on China’s policy of increasingly investing in western infrastructure? Questions are being asked for instance about progress with the development of Wirral and Liverpool Waters.

 

A NEW MAGNA CARTA.

 

As we mark the 800th anniversary of this shake up in English governance, it would be nice if we could take a fundamental look at how we are ruled from parish council to the House of Lords.

 

It doesn’t look as if that is going to happen. Instead we will have to concentrate on incremental change. In that respect the question for this year will be whether Leeds, Sheffield and even Liverpool will be getting the Greater Manchester devolution deal, with or without elected City Region mayors.