Leading Article: The South-east's cry for help

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The Independent Online
THE TERM 'assisted area status' sounds like the regional equivalent of being on the dole: not something for which once-prosperous parts of southern England would want to be found vying. But enough money is at stake, not just from the Government but also from European Community funds, for pride to be swallowed. The current map of assisted areas contains a few in the South-west and not one from the South-east. But among the 1,800 submissions from those anxious to feature on the new map, around 200 are from the South-east. Among them are places once associated with pleasure, such as Clacton and Southend in Essex, plus 22 London boroughs, including Norman Lamont's constituency of Kingston upon Thames and the Royal Borough of Kensington and Chelsea.

The present map of assisted areas - unchanged since 1984, although theoretically drawn up for the lifetime of a single Parliament - covers what was reckoned to be the poorest third of Great Britain. Much has changed since then, with unemployment in the South-east not just growing faster but overtaking rates in Midland and northern areas traditionally associated with declining smokestack industries.

The new map, scheduled for April, will probably cover a smaller total area, so success by southern applicants will be at the expense of those in the north. The Department of Trade and Industry suggests that around pounds 130m will be made available in the year from April. Assisted area status also opens the door to EC regional development funds, likely to be worth pounds 42.7m in 1993-94.

Many of the Government's criteria seem objective, such as statistical measures of unemployment, including the proportion of long-term unemployed, demographic changes and distance from markets. But there are also more speculative considerations, such as future demand for jobs and likely company closures and run-downs.

MPs, naturally, are lobbying fiercely for areas within their constituencies. If the Government is to avoid creating much bitterness and the danger of a political backlash, it must be able to convince all applicants that the criteria have been fairly applied. The temptation will be to favour areas that vote Conservative. Such partisanship could prove counterproductive at the next election, when the map will still be in effect: for example, were a marginal Labour seat to lose its assisted area status, Tory prospects of winning it from Labour next time around would suffer. There may also be considerable discontent in a town such as Luton, which is represented by two Tory MPs and suffers from unemployment of more than 12 per cent - but forms a single 'travel-to-work' area with Watford, where unemployment is lower.

The aim of government aid is not to prop up lame-duck industries, but to help create new jobs and regenerate the local economy. Although specific grants must be cleared with the EC Commission's competition department and returns on such investment are generally not immediate, the present mechanism seems unnecessarily unwieldy and sluggish: witness the great changes since the last review. It may be hard for the South- east to adjust to the concept of assisted area status. It should not be difficult for the Government to devise a swifter route to corrective action.

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