HM Treasury

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96/11

17 August 2011

The Government announces 11 new Enterprise Zones to accelerate local growth, as part of the Plan for Growth

The location of eleven new Enterprise Zones, designed to boost local growth and create over 30,000 new jobs by 2015, were announced today by the Prime Minister, David Cameron, the Chancellor of the Exchequer, George Osborne, and the Communities Secretary, Eric Pickles.

At Budget the Government announced 11 Enterprise Zones in some of the country’s largest cities, including Manchester, Birmingham, Merseyside and Newcastle, as well as inviting applications for 10 more in other areas.

The strength of the applications from Local Enterprise Partnerships was such that Government has agreed to increase this invitation to 11. The location of Zones in the Black Country, Tees Valley and the North East have also been agreed today.This brings the total to 22 Enterprise Zones across the country, helping to create thousands of new jobs by 2015. The Zones will attract hundreds of new start up firms, with simplified planning rules, super-fast broadband and over £150 million tax breaks for new businesses over the next 4 years.

Alongside the new Zones, the Government is also announcing today that it will make enhanced capital allowances available for plant and machinery investment to a limited number of Enterprise Zones in Assisted Areas, including the Tees Valley and North East. With effect from 2012, companies setting up in these areas will be eligible to claim enhanced first year allowances for plant and machinery, giving them an upfront cash flow benefit.

The introduction of Enterprise Zones is just one of over 100 reforms being taken forward as part of the Government’s Plan for Growth, announced at Budget 2011, to create the conditions for strong, sustainable and balanced growth.

The second wave of Enterprise Zone will be located in:

Ministers are urging areas that missed out today to remain ambitious and pursue their innovative ideas to foster local enterprise.

The Prime Minister, David Cameron, said:

“We are determined to do everything we can to make Britain the best place in the world to start and grow a business.

“Enterprise Zones are a major step towards delivering this; cutting business taxes, easing planning restrictions and giving business the tools they need to invest and expand.

“These new Enterprise Zones will be trailblazers for growth, jobs and prosperity throughout the country.”

The Chancellor, George Osborne, added:

“It is vital that we create balanced economic growth across the country. It is time for us to help every part of the country to grow and realise its potential.

“Enterprise Zones are a critical part of our Plan for Growth and will support economic development and create over 30,000 new jobs by 2015. The zones will benefit from over £150 million in tax breaks over 4 years, new superfast broadband, lower levels of planning control and the potential to use enhanced capital allowances.” 

Communities Secretary, Eric Pickles, said:

"Too many of our towns and cities have been left behind, but the answer has never been to impose ineffective sprawling regional structures. It is local business and commerce that drive the private sector growth, jobs and wealth this country needs. This Government's job is to foster local enterprise and create the conditions for businesses to thrive in. That is why low tax, low regulation Enterprise Zones are being planted across the country and will give businesses all the incentives they need to grow their local economy and create thousands of new local jobs."

Business Secretary, Vince Cable, said:

"Enterprise Zones are creating an environment for businesses to grow in places with the most potential. Those the government is announcing today, on top of those already approved, show the range of ambitious plans in place across the country.

"Local Enterprise Partnerships have worked closely with businesses in their communities to put forward a range of high-quality proposals. The successful bids they will now take forward are going to help inject new growth into their economies.

"Across England, these Zones will generate new jobs, investment in areas that can benefit, and develop high-tech products that will secure long-term sustainable prosperity."

Notes for editors

1. To encourage investment and exports as a route to a more balanced economy, the Government announced at Budget 2011 that it would establish 21 new Enterprise Zones with superfast broadband, lower taxes, and low levels of regulation and planning controls.

2. The first round of Enterprise Zones was announced in the Budget 2011 and will be based within the following eleven local enterprise partnerships: Birmingham and Solihull, Sheffield City Region, Leeds City Region, Liverpool City Region, London, Greater Manchester, West of England, the Black Country, Derby and Nottingham, Tees Valley and the North East. More details can be found at: http://www.communities.gov.uk/news/corporate/1872164

3. A further announcement on the exact location of Birmingham, Bristol, Leeds and Sheffield Enterprise Zones was made in late July. Further details can be found at: http://www.hm-treasury.gov.uk/press_90_11.htm.

4. The Government also announced the allocation of funding for the UK’s broadband network yesterday, with English counties due to receive £294.8 million and Scotland £68.8 million. Further details can be found at: http://www.culture.gov.uk/news/news_stories/8389.aspx

5. Enterprise Zones will benefit from:

6. The Government will make enhanced capital allowances for investment in plant and machinery available in designated areas within a limited number of Enterprise Zones. This is only available where the Government and Local Enterprise Partnership agree that it is better for the local economy to focus on a smaller number of companies making significant capital intensive investments. The vast majority of Enterprise Zones will retain a focus on attracting greater volumes of companies through business rate discounts.

7. The Government is also keen to support the introduction of Enterprise Zones in Scotland, Wales and Northern Ireland, if the Devolved Administrations wish to establish them. Government will hold further discussions with the Devolved Administrations about how best to do this.

8. Thirty local enterprise partnerships submitted bids for one of the limited Enterprise Zones places available in this second wave competition.

9. However, Ministers are urging areas that missed out today to remain ambitious and pursue their innovative ideas to foster local enterprise. Every area can still put together a deal for local growth. Councils have the power to implement a simplified planning regime for themselves and UK Trade and Investment is ready to work with all areas to attract foreign direct investment.

10. In addition they will be able to harness Tax Incremental Financing powers, to finance new infrastructure by borrowing against increases in business rates, locally funded business rate discounts and the local retention of business rates when they become law. This will give councils a direct stake in the local economy and new ways to support business growth.

11. Details of the 11 Enterprise Zones selected today:

Rotherwas Enterprise Zone - in Hereford led by the Marches Local Enterprise Partnership proposes:

Northampton Waterside Enterprise Zone - led by the South East Midlands Local Enterprise Partnership proposes:

Newquay Aerohub Zone – led by the Cornwall and Isles of Scilly Local Enterprise Partnership proposes:

Alconbury Airfield Zone - near Huntington, led by the Greater Cambridge and Greater Peterborough Local Enterprise Partnership proposes:

Great Yarmouth and Lowestoft Enterprise Zone – led by the New Anglia Local Enterprise Partnership proposes:

Daresbury Science and Innovation Zone - between Warrington and Runcorn, led by Liverpool City Region and Greater Manchester Local Enterprise Partnerships proposes:

Humber Waterside Enterprise Zone - in Kingston upon Hull, led by Humber Local Enterprise Partnership proposes:

Discovery Park in Sandwich and West Essex Enterprise Zonein Harlow – led by the Kent, Essex and East Sussex local enterprise partnership proposes:

Science Vale Enterprise Zone – led by the Oxfordshire local enterprise partnership proposes:

MIRA Technology Park in Hinckley – led by the Leicester and Leicestershire local enterprise partnership proposes:

The Solent Enterprise Zone at Daedalus Airfield in Gosport – led by the Solent local enterprise partnership proposes:

12. Details of the locations of Sites locations in Black Country, Tees Valley and the North East agreed today:

North Eastern Enterprise Zone- led by the Local Enterprise Partnership proposes:

Black Country Enterprise Zone - led by Local Enterprise Partnership proposes:

Tees Valley Enterprise Zone - led by the Local Enterprise Partnership proposes a number of sites across Tees Valley.

13. The tax break figures quoted above are estimates based on information provided by Local Enterprise Partnerships within their bids, and on expert advice from the Valuation Office Agency. The estimates are an informal expression of opinion, without prejudice to any rating list alteration that may eventually be made. Estimates are adjusted for the effects of the state aid de minimis where possible. Cost estimates cover the period from 2012-13 to 2015-16.

Non-media enquiries should be addressed to the Treasury Correspondence and Enquiry Unit on 020 7270 4558 or by e-mail to public.enquiries@hmtreasury.gsi.gov.uk

This Press Release and other Treasury publications are available on the HM Treasury website.

Media enquiries should be addressed to the Treasury Press Office on 020 7270 5238.

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