Investment zones are ‘cheap and nasty’ attempt at levelling up, claims council economy chief

New ‘investment zones’ set to be announced by the government this week have been branded a ‘cheap and nasty’ attempt at levelling up by Rochdale’s regeneration cabinet member.

It is understood the government has written to about 40 councils inviting them to submit proposals for the zones, which will offer tax breaks and loosen environmental regulations in a bid to boost economic activity.

Chancellor Kwasi Kwareng is expected to give the go-ahead for the initiative at Friday’s mini-budget – the first ‘fiscal event’ under new Prime Minister Liz Truss.

However, Councillor John Blundell, Rochdale council’s economy and regeneration cabinet member, is far from convinced the zones will deliver real benefits to less prosperous areas of the country.

“[To say] ‘if you move here you don’t have to pay any tax’ is not a good advertisement for a place,” he told the Local Democracy Reporting Service. “It’s a cheap and nasty way of dealing with systemic problems.”

The council boss believes that, rather than being a new policy, investment zones merely ‘rehash’ tried and failed American ideas from the seventies and eighties.

“It essentially displaces economic activity, using tax incentives, which isn’t necessarily what places need, ” he said.

“Places need investment, they need infrastructure, they need a team of people to develop sites – rather than giving tax breaks to companies to move to places the government finds advantageous.

“They should focus on investing in places. They are just pandering to right wing ideals.”

However, Councillor Blundell says Rochdale would accept an investment zone should as the ‘Atom Valley’ Mayoral Development Zone is a ‘prime area for that type of activity’.

Signed off in August, Atom Valley spans three sites in Rochdale – two of which span borders with Oldham and Bury. Local leaders say it has the potential to deliver 1.6m sq m of new employment space, create around 20,000 jobs and deliver 7,000 new homes.

Councillor Blundell, believes that the investment zone could work effectively in conjunction with Atom Valley – which itself forms part of Places for Everyone, Greater Manchester’s emerging long-term development plan.

“If that goes along with the establishment of a development corporation – that is staffed and has access to funds to build the roads, put the trams in and get the utilities in, and can speak to international companies and there’s a suite of things around it and the resource to do it – that would be helpful, he said.

“In Rochdale, we would take one but, in the grand scheme of things, if you are going to offer one, does it really matter if it’s in Rochdale or Bolton? All you are doing is offering tax breaks to companies.”

Nick Statham, Local Democracy Reporting Service