Sunday, 29 January 2006

Lanarkshire tops British league for generating ‘affordable’ businesses

That's the upbeat headline for this story in today's Sunday Herald.

Good news, I thought. Lots of Lanarkshire entrepreneurs generating affordable businesses. But hang on a moment: what's an "affordable" business? Is it one that you buy down at the Co-op? Are we talking of companies that can be purchased by people "in the community"? Sadly, no. Remember that Lanarkshire is the heartland of the "Labour Community", and that means money, money, money. Your money:

A final evaluation report of the Lanarkshire Enterprise Zone project suggests it cost much less in taxpayers’ cash per job created than any other similar project.
Aha! The taxpayer. And how much less is this costing, you may ask?
The report showed that the cost per job of the net additional jobs created was £14,609, compared to £21,485 which is the UK average, according to the 1995 evaluation.
But note that one reason for previous economic problems in Lanarkshire was this:
A high degree of reliance on an inward investment market which subsequently collapsed.
Many, many, foreign-owned factories were given taxpayers' cash to come to Lanarkshire and other parts of Silicon Glen and now they're leaving for cheaper or more subsidised pastures. It's beginning to dawn on most of us that imported businesses built on subsidies don't last. So, tell me, why doesn't this logic apply to domestic businesses, even "affordable" ones? I think that it does. So instead of spending £14,609 a go to create jobs that probably won't last, why not simply make Lanarkshire a vast tax-and-regulation-free enterprise zone?

1 comment:

David Farrer said...

Comments made on previous template:

Neil Craig
Starting from where we are rather than where we would like to be 14 grand per new private sector job is a good investment - particularly when the real life alternative would be paying for half a public sector job for a year & a half. 
I am also not in principle of the opinion that subsidising inward investment is automaticly discredited by some businesses leaving. It is inherent in speculative investments that some of them don't work - if they all do you aren't being speculative enough. One problem with government is that the chairwarmers get far more stick from failure than credit from success so they don't take risks.  
Of course that argument works even better for just cutting corporation tax (my own hobby horse) which is the equivalent of investing in everybody without the administrative costs.

4 February 2006, 18:20:43 GMT
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David Farrer
Shamed indeed. But you can't make an omelette without breaking a few eggs.

31 January 2006, 19:22:00 GMT
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Jack Maturin
I don't think the Lanarkshire Enterprise Zone board members are going to take too kindly to your suggestion of a vast tax-and-regulation-free enterprise zone. For one, there'd be no need for the Lanarkshire Enterprise Zone board, or the tax collectors who fund it, or the politicians who oversee both bodies. That's three socially necessary groups gone already. How much more social carnage are you prepared to reap, in your so-called libertarian utopia, where no such thing exists as society? You ought to be ashamed of yourself.

31 January 2006, 12:50:30 GMT