The Spring budget’s key takeaway for South Yorkshire:
- Devolution & governance. Further details on the ‘trailblazer’ devolution deals with GMCA and WMCA were revealed, providing a blueprint for other MCAs to follow. These will see income streams increase as business rates are fully retained, single-pot settlements, with increased powers over housing, retrofit, and skills. LEPs are to be wound down and evolved into business advisory bodies, with funding ceased by April 2024. SYMCA has already been developing plans for what a successor to the LEP will look like.
- Regional development. South Yorkshire (SY) will be one of 12 Investment Zones in the UK, worth up to £80m in backed funding and tax incentives. The schemes can begin from 2024/25 and comprise up to 600 hectares (10x size of Advanced Manufacturing Park). A third instalment of Levelling Up Funding (LUF) with additional £1bn to top up the £3.8bn allocated in the previous two rounds. LUF has so far funded several schemes in SY totalling £105m. A second round of CRSTS (geared to sustainable urban transport capital investment) is announced. SYMCA received £570m in the first round.
- Cost of living. Maintaining the Energy Price Guarantee at the current level will provide some protection of disposable incomes, including households in fuel poverty, which SY has a higher prevalence of compared to the national average (19% vs. 13%). Extending the previous cut to fuel duty is an expensive choice (2023/24 alone costs the same as entire Levelling Up Fund). However, this broad policy does protect disposable incomes, albeit adding challenges to reaching net zero targets. Extending free childcare provision for up to 30 hours per week for children starting at 9 months, is another headline. It may have a role increasing labour force participation, especially for women, as the scheme ramps up over coming years. Female unemployment in SY is higher (5.8%) than the national average (3.6%). However, this policy will take up to 3 years to be rolled out so the full impact may not be immediately realised.
- Energy & net zero. Reclassifying nuclear energy as ‘sustainable’ and promising new funding streams for both nuclear and carbon capture and storage (CCS) signals an increasingly supportive environment for investment in these two low carbon technologies. South Yorkshire has world class facilities and strengths in both sectors, so this policy will be watched with interest. There is some concern that funding proposed isn’t at a level or pace (£20bn over 20 years for CCS) that can meaningfully contribute to net zero targets.
- Skills and employment. The new Universal Support programme and associated white paper is a recognition of growing post-Covid economic inactivity driven by ill health. This problem is even more prevalent in SY. Efficacy of this new policy to encourage early retirees back to the workforce – ‘Returnships’ and ‘Skills Bootcamps’ – is less well supported by available data and has less relevance in SY.
Please download the file below to read the South Yorkshire Mayoral Combined Authority Weekly Policy Briefing -Spring Budget Special: