NECC's job fears as investment is cut

Mar 22 2010 by Jez Davison, Evening Gazette

THOUSANDS of construction jobs could go in the North-east as local authorities are forced to cut back on their building plans, business leaders have claimed.

Council spending on major investment projects in the North-east is to plummet more than £800m by 2013, according to data obtained by the North East Chamber of Commerce (NECC).

The figures showed that investment in the Tees Valley will almost halve, from £300m this year to £154m by 2013.

NECC said current council budget predictions would see the region miss out on 17,000 jobs as local authorities struggle to find cash for new flagship projects.

Martyn Pellew, NECC president, said the predicted decline in public sector spending was “truly frightening”.

“The North-east, more than other UK regions, is particularly exposed to these cuts and the figures published today by NECC must be a catalyst for action,” he said.

“North-east councils need to take a more proactive approach to the way they award contracts. It is essential that local authorities make sure that they squeeze the maximum value for the North-east out of every penny they spend.”

Mr Pellew urged council bosses to think twice about introducing damaging cuts and to consider the benefits of using local labour on capital projects.

“It will be too easy for authorities, faced with rapidly shrinking budgets, to think that cheapest is best,” he said.

“This would be catastrophic for the North-east economy. A number of councils are taking a much more proactive approach to the way they award contracts and we want to see this become standard practice across all North-east authorities.”