Taking it back to the 80s: Enterprise Zones

20 Mar

Enterprise Briton? Again?

This week, Chancellor George Osborne stated that the government will put aside £100 mil in the new budget to create 10 new enterprise zones in England. These ‘hotbeds of economic development’ seem to be a revival of Margret Thacther’s 1980’s individual tax breaks and other incentives for ‘depressed urban areas’.

However, the Thatcher’s ‘urban renewal-program’ has been under fire since the early 90s; the rate of return from this model is said to be far too low, some even argue negative. Two reports from ‘The Work Foundation’ and ‘Centre for Cities’ put forward how zones create too few jobs and are far too expensive. Moreover, it is suggested by many sources that times have changed – 80’s style enterprise zones will simply not work in the present climate.

However, let’s look at the opportunity! This is a fantastic way to further any business. ‘Depressed areas’ suggests a ready and willing work force, not to mention the vast array of tax and regulation relief. Furthermore, the government would be silly not to follow the Canary Wharf model of impeccable infrastructure and transport links; surely that will make living, trading and working in these zones a joy?

My point is that whilst the zones may not be the most cost effective for tax payer, only the true entrepreneurs and innovators within the public realm will realise and adopt the social, cultural and economic capital that these zone provide an opportunity to harvest. In support, Mr Chancellor has stated that the new zones will be focused on areas of high growth potential, not just physical decline, and will be tailored to the individual needs of an area. This will become apparent when the 2011 Budget is unveiled on March 23rd.

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