Third of North East businesses fear going under as pandemic bites - leaders want 'shovel-ready' schemes prepared to help steer region out of crisis

More than a third of North East businesses fear they could be forced to close as concerns mount over for the economy’s post-coronavirus recovery.

Thursday, 30th July 2020, 7:35 am
File picture from PA

According to the latest figures, just three per cent of firms in the region say they were not affected by COVID-19 pandemic, which saw about a quarter of workers furloughed.

One of the industries fearing for its long term future is the construction sector, which has bounced back but still faces ‘uncertainty over future demand’.

“A few weeks ago the Prime Minister made a speech about ‘building back’, very soon after a call for ‘shovel-ready’ schemes,” said Vince Taylor, economic lead officer at the North East Combined Authority (NECA).

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“Construction schemes are about trying to kick start the economy again, with £47million allocated to the North East.

“Those schemes were put together very quickly from existing, well-developed schemes that weren’t completely funded and that extra money will make the difference, in terms of making up the funding gap.”

Taylor was speaking at a meeting of the NECA Leadership Board, which was held by videolink and broadcast via YouTube.

He added the government expects such projects to be turned around within 18-months, a requirement he called ‘very challenging’.

Earlier this month the North East was awarded £47million from the government’s ‘Getting Building Fund’, which is intended to kick start an economic revival.

Ministers have allocated a total of £900million for ‘shovel-ready’ projects in England.

The North East area, made up of County Durham, Gateshead, Sunderland, South Tyneside, North Tyneside, Newcastle and Northumberland, received one of the biggest shares in the country, with only the South East, the West Midlands and Greater Manchester in line for more.

The neighbouring Tees Valley mayoral authority is due £17.4million.

Iain Malcolm, chairman of NECA and leader of South Tyneside Council, said: “I’m really pleased with the way the region came together to present our schemes for regeneration to the government.

“What it demonstrated is we need shovel-ready schemes always there, just in case there is an underspend in any government department or the government has some cash to allocate to the regions and spend it quickly.”

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