Wales politics

Newport anger after city by-passed for enterprise zones

Newport council has hit out after being omitted from a Welsh Government announcement on nurturing businesses.

The council's leader said it was angry the city had not been made an enterprise zone and that it will be "squeezed" by others on its doorstep.

Conservative assembly leader Andrew RT Davies said the policy had been drawn up "on the back of a fag packet".

Five zones are being set up with the Welsh Government open to considering other areas if opportunities arose.

Business Minister Edwina Hart said she had made her decision after listening to businesses over the summer.

She was urged to act after 21 enterprise zones were announced in England.

'Squeezed'

Industries in five parts of Wales will receive rate relief and may benefit from tax breaks. The Welsh zones will be at Anglesey, Ebbw Vale, Deeside, St Athan in the Vale of Glamorgan, and Cardiff.

The Welsh Government said its plans were in the early stages and no final decisions have been made on whether to relax planning rules. An initial £10m is being made available over the next five years.

Conservative leader of Newport council, Matthew Evans, said the council was "bitterly disappointed and angry" it had been left out.

He said: "The city will now be 'squeezed' by Bristol and Hereford on one side and Cardiff and Ebbw Vale on the other making it even more difficult for Newport, which is just as seriously affected by the global recession, in facing the on-going economic challenges."

He urged Mrs Hart to make Newport the sixth enterprise zone, covering the digital sector. The city had put forward a "strong" bid, he said.

'Lack of respect'

Mr Evans also accused her of making a "hasty decision" that was announced on the day Jaguar Land Rover said it would open an engine factory in the West Midlands.

Mrs Hart said enterprise zones had not been a factor in the car manufacturer's decision to choose Wolverhampton over south Wales.

Jaguar, which also considered India, said the £355m factory would be closer to its other plants.

Conservative leader Davies said: "At 12 o'clock yesterday I had a written reply from the minister that indicated that no announcement was imminent.

"I do believe that the minister was making it up on the back of a fag packet."

He said revealing the zones the night before the assembly's first plenary session of the autumn term showed a "lack of respect to this institution".

He added: "Have we got a government driven by policy, by initiative or have we got a government driven by the media?"

Mrs Hart told BBC Wales on Monday: "This is a first stage announcement, we are having discussions with other local authorities and partners about possible other enterprise zones.

"I think what's been made clear to me over the summer from industry and all the people I've spoken to is they regard enterprise zones as a real focal point for them."

She said discussions were ongoing with the UK government over budgets for capital allowances - where companies receive tax breaks when they invest in new machinery to expand.

Liberal Democrat enterprise spokeswoman Eluned Parrott said the zones were "better late than never".

'Direct threat'

She said: "I am slightly concerned about the prescriptive nature of the zones.

"In Cardiff this is less important as I think it would be financial bodies that would locate there anyway but in other areas it may be dangerous for civil servants to think they know better than the market."

Plaid Cymru economy spokesman Alun Ffred Jones said "huge swathes" of Wales had been left out.

He said: "The locations of the five enterprise zones announced by Labour last night are a complete dismissal of economic development in mid, west and south west Wales - including Swansea, and the majority of the valleys region.

"People in those areas that haven't been selected by Labour will see this as a direct threat to jobs there."

Cardiff council leader Rodney Berman said designating the city centre as a financial services enterprise zone would help it compete with English cities and regions.

A Welsh Government spokeswoman said: "This is the first tranche of preferred locations for enterprise zones.

"We remain open to opportunities as they arise in other areas of Wales where we are already in discussion with local partners.

An aide close to the minister rejected the Tories' claims, saying they "want it both ways".

"On the one hand, they're criticising the government for not having enterprise zones and now they're moaning that we've made the announcement."

He added: "The fact is our made in Wales Enterprise Zone proposals have been welcomed by senior figures in the business community across Wales. This support for our plan has obviously wrong-footed the Tories - again."

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