It's time to unlock EU cash for RDAs

WRITING a column for The Journal should have a health warning attached to it.

WRITING a column for The Journal should have a health warning attached to it. Sometimes you seem to be swimming against the tide, asking 'is it me or is the rest of the world mad!'

So it was heartening to see several newspaper articles in recent days that resonated with some of the points I've been making.

Firstly, the All Party Urban Development Group (APUDG) published a report entitled 'Regeneration and the recession: Unlocking the money'. I was co-author of a submission to this by the Royal Institution of Chartered Surveyors (RICS) and I'm glad to see that amongst their recommendations is the formation of Alternative Development Zones.

It's an area where the North East could be taking the lead with pilot projects in NewcastleGateshead.

Regular readers will know that I have a bee in my bonnet about JESSICA, a European Union (EU) fund set up from 2007-13 which allows RDAs (e.g. One North East) to use their EU structural funds to create an urban development fund for use as equity, loans or guarantees.

The APUDG report recommends "to take advantage of this opportunity, national government should adopt a stronger leadership role to ensure that the scheme is utilised to its fullest possible extent".

My point exactly, Government has been dragging its feet and blaming EU red tape and it's about time they let the RDAs have access to this money which could bring massive relief to the beleaguered construction industry.

We next heard that Business Secretary Lord Mandelson and Minister for the North East Nick Brown MP have combined to ensure that JEREMIE, another EU fund this time to aid SMEs with equity finance, is introduced into the region early next year. There is a suggestion that Whitehall staff wanted to put the £125m scheme on hold but the dynamic duo stood their ground.

About time too, we have been waiting long enough for these funds. We seem to have been talking about JESSICA and JEREMIE for months if not years now without seeing a penny of benefit from them. Both are vital to lever in much-needed funding for those regeneration projects that will help to grow the North East economy and offset losses.

We next heard from the Centre for Cities think tank who accused the region of relying too much on public sector jobs. In the current economic climate, the threatened loss of public funding could mean that 6,500 of these jobs are axed. It echoes the recent report from the Centre for Economic and Business Research, which I mentioned recently, that estimates state spending will account for over 63% of the North East economy 2010/11.

Those public sector jobs were essential for the North East in the short and medium term following the collapse of our traditional industries but in the long term it is not a sustainable strategy. Government, national and local, needs use its funding to support the private sector and encourage success and job creation - that's why the delaying funds such as JESSICA and JEREMIE is so counter productive.

To those of you asking what's the difference, it's all state aid, the answer is that one is a hand out and the other is a hand up and if the latter works there will also be a hand back.

Kevan Carrick is partner in JK Property Consulting LLP and policy spokesman for RICS North East


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