Timothy Kirkhope: Good news for enterprise as cities get special treatment

As a member of the last Conservative government involved in planning development corporation policies, which went on to regenerate deprived areas in our region, I support the Chancellor’s proposals. I hope, however, that the fast track planning process which was a feature of development corporations is replicated as far as possible this time around.

I also commend Mr Osborne’s commitment to simplify the tax system. Getting rid of red tape must be a central theme if we are ever to stay in touch with countries like India, China and the emerging economies of South America. In our global marketplace it’s a measure that businesses all over Yorkshire will appreciate.

On top of the two per cent reduction in corporation tax, the enterprise zones will help to create conditions for growth by introducing incentives to businesses. Tax breaks and the relaxed planning rules should boost SMEs already in the areas covered as well as attracting many new businesses.

The Government has been criticised for not giving enough help to our businesses. However, ensuring our economic recovery is a two stage process, we first have to reduce spending, then we must also “kick start” the economy.

All of this is being done against the background of massive public debt, the inheritance from the last government. To combat this we must not be afraid to learn lessons from the past. The Major government, of which I was a part, also had to deal with a recession. History will show that we started to turn it around by boosting British business and its ability to trade.

The current plans show the new Government’s commitment to achieving growth. They show that we see SMEs as key to our recovery and they also show that Yorkshire and Humber is one of the priority areas.

And this is just what the region needs. Leeds, as regional capital, must stay ahead of the game. The Ordsall Chord, a new piece of railway in Manchester connecting Piccadilly and Victoria stations, will cut journey times from Leeds, York and Hull to Manchester and Liverpool, creating jobs and stimulating the local economy.

Although many businesses now rely on being connected by air, rail and road, they also need fast internet connections. The Government has promised better web connections for businesses within the enterprise zones. I recently attended a Yorkshire Broadband Conference and it is clear to me that things are moving in the right direction. A successful business will want to tap into every resource that it can get its hands on, but more importantly, greater broadband penetration helps to bring customers closer.

The measures announced by the Chancellor will also work by letting good businesses blossom. Rather than throwing money at everyone, like the last government did, the coalition wants to incentivise businesses. Anything that makes life easier for entrepreneurs to create business opportunities should be championed.

In Europe, we are also getting to grips with the problem. There is now a greater awareness in the European Commission of the negative impact that regulations can have on SMEs but there are still signs of over-regulation and protectionism.

We have decades of regulation to simplify or scrap, but we must encourage our businesses to take advantage of the single market. There are many good ideas coming out of the European Small Business Act (SBA) but so far the commitment to it has been patchy.

We must strongly resist some of the more toxic proposals coming from Brussels. Conservatives have fought hard for a budget freeze in Europe and we will not support a common tax system, for a long time a Commission idea.

The Common Consolidated Corporate Tax Base (CCCTB) is a veiled attempt at another EU power grab and must be resisted. Despite soothing rhetoric, it’s obvious that certain countries want this as a first step towards harmonising tax rates. Not only does that mean taxes would be under the control of Brussels, but it would also spell disaster for competitiveness. Tax competition between EU countries makes us all more competitive on the international stage.

No, the most encouraging language is not coming from the Commission, but from the Council, where the Prime Minister recently scored a victory when he pushed for the competitiveness agenda and secured numerous allies. With events in Japan and Libya vying for attention it was important that agreement was reached to develop concrete plans, such as the ones set out for the whole of Europe.

I am optimistic about Yorkshire’s future, but we need to work together in a spirit of enterprise to guarantee success.