1,350,000,000 reasons for NE public sector to look local

A regional employers' group has today called on local councils to play a greater role in the economic recovery of the North East.

The North East Chamber of Commerce (NECC), which has more than 4,500 members, has written to chief executives and leaders of every local authority in the region urging them to more actively support businesses in the area.

The public sector has the greatest buying power in the North East and yet 55% of all money spent by local authorities goes to companies outside of the region. The net result is that £1.9bn of a total £3.5bn is lost to the regional economy each year.

The call to arms comes on the first anniversary of the launch of NECC's Buy North East campaign which highlighted that councils could boost the regional economy by £1.35bn and create an additional 6,000 jobs if they awarded just one per cent more work to firms in the region each year to 2016.

Richard Bottomley, NECC president, said: "The Buy North East campaign was launched to show local councils the enormous impact they can have on the regional economy by working more closely with firms in their area. In the current climate, this has never been a more pressing issue.

"This is an economic argument, not a parochial one. Money invested in local firms will circulate the North East economy in wages and local spending rather than being lost to London and other parts of the UK.

"Greater support for companies in the North East will help them to maintain healthy order books during the global slowdown. It will indirectly pump more money into the economy and help to improve consumer spending.

"This, in turn, will also accelerate our recovery and put the region in far better shape than other areas as we emerge from the current predicament. Given the economic climate, does this not represent 1,350,000,000 reasons for the public sector to wake up to the benefits that are brought by working more closely with local firms?"

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Reader’s comments

  1. Richard

    9:23 20 Nov 2008

    Absolutely agree with the Chamber's campaign to get the region's public sector to recognise that procurement can be an effective way of boosting local economies. There are stringent rules around procurement but many public sector bodies view procurement as an exercise in risk management rather than economic development. If they made the system less bureaucratic, especially for smaller contracts, then they would effectively widen the net of potential suppliers.

  2. Hayley

    11:47 26 Nov 2008

    For a small creative company - having to tender and pay to be on specialist suppliers lists is a real drain on resources and costs money that could be better spent elsewhere.

    Get rid of this 'paper exercise' and make the playing field level!!!

    Couldn't agree more with this campaign.

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