Business rates retained under the Humber’s freeport status could be as valuable as the £1 billion tax break package there to lure inward investment, it has been revealed.
The potentially huge economic war chest will be pooled by the four local authorities, and used to advance the region’s role in leading the race to Net Zero.
Lewis Atter, managing director of financial giant KPMG’s Infrastructure Strategy practice, has worked with ABP and other stakeholders to put forward the successful and class-leading bid.
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He was part of the Humber Business Week opening event that focused on the potentially transformative development that has been secured this spring.
Mr Atter said: “The overall financial value of tax breaks up front for private investors and retained business rates downstream - they were very close to each other. The overall difference we can make with how we spend the money could double up what we get from the individual tax sites.
“The operating model is the real opportunity; we start in a very good place really early on.”
Humber’s plan focuses on specific sites to develop, an approach government was “very supportive of,” Mr Atter said - allowing a phased roll-out, potentially from this autumn.
“These are industrial strength enterprise zones, materially greater and more attractive to manufacturing than the enterprise zones of 2012 to 2016 - it is not surprising they have been restrained,” he said of the allocations.
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“The tax breaks on offer with public and private commitment deliver things for the Humber that would not otherwise be possible.
“Retained business rates and the seed capital programme will widen the footprint of what we can deliver for the region.
“Retained business rates may prove to be the most significant aspect. Our sampling exercise suggests the value of retained business rates could be as much as the initial tax benefits to investors, recognising these are retained for 20 to 25 years.
“This will allow the Humber to deliver twice what it could.”
And he said success will make further investment easier. “The clearer we are that we are delivering genuine additional gains, the more of this we are likely to see.
“The more success we have with freeport the more momentum we build around whatever it is we need.”
Hosted by Marketing Humber’s chair, Bill Walker, Global Humber: Local Opportunities also heard from ABP head of policy, communications and economic development, Dafydd Williams and inward investors Paul Atherley, chair of Pensana and Neil Etherington, business development director for Able 海角视频.
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The latter, behind the £517m Able Marine Energy Park, which is closing off due diligence on £75m of public funding, said: “The stars are becoming aligned for the Humber as a whole, and particularly for Able Marine Energy Park. We have government policy and appetite in the sector and we as ever retain our commitment to bring AMEP to fruition.
“These are incentives that will make a difference and accelerate the rate of development and provide eye-watering subsidies to international footloose businesses. This isn’t rearranging the deckchairs, it is getting new, novel activity here in the Humber.”
Mr Williams had given the background to the successful bid and “one of the most important opportunities for economic growth that our region has,” charting the long support for such a mechanism and the “conservative” 7,000 new jobs estimate.
“ABP took the decision to step up and take the leadership on this, in two ways; to try and be a driving force to bring people together; and to put our hand in our pocket and pay for the work that we knew needed to be done,” he said, telling how it had been a long-backer of the concept.
He told how Chancellor Rishi Sunak had been involved long before taking the Treasury's top role, with his appointment a "particularly helpful moment".
There was widespread praise for the unity behind the bid too, with North East Lincolnshire to be the accountable body behind it, working alongside both LEPs, North Lincolnshire Council, East Riding and Hull City Council, as well as other private businesses.