The Economist of November 16th had some hard things to say about the ' Tory regional plans for Central Scotland and north-east England. In its guide to contents it headed the article "Swill, not cure - Proposals for two British regions amount to thin gruel for central Scotland, thinner still for the North Hast." The article itself started:
"The first thing to say about the regional plans for central Scotland and north-east England is that they are not really modern economic plans at all, They are not drawn up in terms of any Keynesian estimate of the gap between demand and potential supply there, because it does not soem to have occurred to anybody in the Govornmont that such language (and sich thinking) would be relevant. An innocent might have expected some estimates of the present annual value of production in these two regions, and a comparison with what the planners estimated could porhapa be economically produced there if all of there regions! resources were fully and efficiently utilised: that is, if their 1962 male unemployment rates of 3.8 to 4.2% were reduced nearor the national average of hy and if more of their womon had the opportunity to go out to productive work, From this could have flowed a bold satatistical estimate of what approximate shortfall in domand and output in these areas appears to be in terms of million~ of pounds = year; and a detailed assesament of how far the Government's specific plans for increasing regional public investment and its vaguer plans for encouraging regional private invostmont aro meant to fit into some rough system of regional income accounting, like tho national income accounting on which national oconomic surveys aro at least nominally based. Put nothing of this sort has been attempted.
"In consequence, the plans lack any real radicaliem as well as even an approximate degree of guiding precision, A radical would have asked such questions as whether it might be sensible to remit employers! national insur ance contributions in development regions in order to encourage more “ployment there, and perhaps even part of employees' contritutions in order to stimulate local consumption, ‘Yould not a large increase in notional unemployment benefits increase local spending in precisely tho right places = i.e,., in the areas with tho greatest unemployment? Might one advantage of moving over from purchase tax and profits tax to a turnover—-1.e-added tax be that a T.Veiie in development districts could perhaps be discriminately roduced? What are the reasoned objections to the Economist's suggestion of meeting the longterm structural problem by considering a move of the administrative capital of Britain from London to the North?
"Jeeeln accord with this public works policy, the only really hard figures in these new "plans" aro that north=-ea;;t Gngland (with 53% of Dritnin's population) is expected in future to enjoy 7% of the Government's public investment, and central Scotland (with 74% of Britaints population) 11% of public investment. No attempt is made to relate the extra £85 million a year that will thus presumably be pumped into these two regions to the assumed shortfall of productive employment there. We are given no yardstick by which to maasure whether it is too little or too much, The last budget's moasures to oncourage private investment in these regions (free depreciation," etc,) ere extolled, tt there is no indication of what level of new private investment the Government is hoping for as a result, or what level of response would be regarded as so disappointing that tho last budget's incentives would have to be increased, Nor, on the other hand, is there any discussion of at what stage, if these measures do not work, it might be right brutally to agree to stop even trying to import new factories into some parts of these areas and to go on allowing the export of population from them instead, The “plans," in short, are exprossions of worthy half-aspirations with remerkably little tangible economic analysis behind them, It is as such that they must be Judged. sessse"™