Mayor tells Government that region will need billions in the event of a ‘no deal’ Brexit



Mayor of the West Midlands Andy Street today (Thursday February 28) called on Government to guarantee major support for the West Midlands economy in the event of a ‘no deal’ or disorderly Brexit.

He has told Business Secretary Greg Clark that the level of support needed to protect and maintain the success of the UK’s fastest growing regional economy will run into billions.

The Brexit Economic Contingency Group, made up of high level business, trade union and political leaders and chaired by the Mayor, has warned that the West Midlands is particularly vulnerable to a disorderly departure from the EU.

Mayor tells Government that region will need billions in the event of a ‘no deal’ Brexit

Steve Tinley (left), commercial director at APS Metal Pressings in Hockley, Birmingham explains to Mayor of the West Midlands Andy Street the potential implications of a ‘no deal’ Brexit on the firm

This is in a large part due to the region’s role as the UK’s exporting and advanced manufacturing heartland.

The Mayor today wrote to Mr Clark to outline the measures already drawn up locally while setting out the indicative Government support that would be needed over the next three years.

This includes:

  • A £644m fund for businesses with cash flow issues or struggling to secure loans for investment
  • A workforce support package of £36m for workers made redundant, the retention and retraining of staff and for an apprenticeship protection scheme
  • A business support package of £8.3m with help for exporters to access foreign markets including bespoke trade missions
  • £1.5bn to accelerate planned infrastructure projects such as new tram and rail lines that inject extra money into the economy and create new jobs  

The Group also warned, however, that billions more in targeted support could be needed for the region’s advanced manufacturing industries such as automotive and aerospace which are also critical to the health of the wider UK economy.

The Mayor said: “While we welcome the Prime Minister’s move this week to provide some reassurance over a ‘no deal’ Brexit, we need to accept that the threat to our economy is still very real.

“We also know that the West Midlands is more vulnerable to a no deal or disorderly Brexit than other parts of the UK due to its strong manufacturing sector which relies heavily on importing materials and exporting goods.

“While we hope a deal can be reached we still need to plan for the worse and stand ready to do whatever it takes to make sure the region gets the support it needs.

“So we have today outlined to Government the support we believe will be needed in the event of a no deal scenario.

“We have already drawn up detailed contingency plans that we can fund locally but the scale of the potential impact of a no deal departure means the Government will need to step in and play its part as well.”

The Mayor issued his call on Government as he visited APS Metal Pressings Ltd in Hockley, Birmingham to hear first-hand about the uncertainty being caused by Brexit and what preparations businesses are making themselves.

APS, which manufactures parts for the car industry, exports around 30 per cent of its goods and is one of thousands of supply chain firms based in the region.

The Government’s own figures suggest a no deal departure could see the West Midlands economy shrink by more than nine per cent over the next decade when compared to its recent rates of growth.

Cllr Brigid Jones, deputy leader of Birmingham City Council and vice chair of the Brexit Economic Contingency Group, said: “It's clear that a 'no deal' or disorderly Brexit will have catastrophic consequences for the people of the West Midlands and the Government must guarantee major support for this region.

"We know from the Government's own analysis that the West Midlands is particularly vulnerable in the event of a 'no deal' Brexit and Government funding is essential to protect jobs and businesses.

"That's why we're urging the Business Secretary to guarantee support to minimise the potential damage to communities, towns and cities in this region."

The cross party Group has been tasked with planning the region-wide response to Brexit, enabling business and the unions to give their views on what is needed to safeguard the economy.

Part of that work has seen the Group look carefully at the level of expenditure the Government needed to make available to support the economy after the financial crash of 2008.

The Group has mapped that against the needs of today’s West Midlands economy. The financial crash of 2008 is the nearest comparable event but the Group has warned that a ‘no deal’ Brexit could be worse.

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