Warning as the recession starts to bite
Mar 12 2009 By Adrian Pearson, The Journal
ECONOMIC experts have warned the North East that the gains made in the last 10 years will be wiped out by the recession unless regional leaders act now.
A hard-hitting look at the economy of the North East has suggested there will be thousands more job losses still to come as public sector spending, which accounts for a third of the region’s employment, is cut back.
In a stark warning to the region’s businesses leaders and regeneration groups, experts studying the region on behalf of Gordon Brown’s favourite think tank The Smith Institute said the recession will make all previous ways of growing the region’s economy obsolete.
It is understood senior civil servants in Whitehall have already indicated that the impressive funding streams previously handed over to English regions for regeneration are likely to be "substantially reduced" in coming years.
City leaders last night admitted they were already looking at new ways of attracting more cash to Newcastle and the North East which they hope will be in place before the Government begins a round of expected funding cuts.
Newcastle Council leader John Shipley said that for the next 12 months at least councils will likely need to borrow millions of pounds to prevent major regeneration schemes, such as Science City, from collapsing as Government cash and business investment dries up.
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