Labour’s Shadow Chancellor Ed Balls was in Birmingham as he prepared for next week’s Budget showdown with George Osborne. He spoke to Neil Elkes after seeing first hand what Midland businesses want.
Ed Balls is the Labour man the Tories love to hate. He is also a divisive figure within the Labour Party where he has gained a reputation for plotting and mixing it up.
But as he prepares for his second budget as Shadow Chancellor he is warming to a new theme, claiming that the time for Labour hand-wringing over the economy and its relaxed attitude to bank regulation is over.
Instead he is on the attack and voters can expect to see him bating his opposite number next week.
“Some people say George Osborne is the phantom chancellor. On the Two Ronnies they had the phantom raspberry blower who used to pop out from behind buildings then disappear. We see our Chancellor just as much.
“He’s hardly ever on the television, he does few interviews,” he explains.
It is thought that Osborne avoids the limelight because he does not appeal to voters, but Balls has another theory.
“The problem is he doesn’t know what the answers to the questions are. He said the economy would grow, it’s flat lined. He said he’d get unemployment down, there’s been a 100 per cent rise in long term unemployment among young people in 12 months.
“This region lived through high long term youth unemployment in the 1980s and still bears the scars of that.
“We’ve got a problem getting the deficit down because if you’ve got fewer people in work you end up borrowing more and that’s part of George Osborne’s problem, and what’s his answer?”
“His view is that if Government stops doing things, that liberates the private sector, but it doesn’t work like that because private business says they want Government to regulate less, but on infrastructure and skills they want Government to do more.
“Last quarter we lost 65,000 public sector jobs and only created 5,000 private sector jobs.”
Each set of economic figures, including the 28,000 rise in unemployment announced on Wednesday (March 14), certainly provide the opposition with further opportunities to bash the Government.
He also points out that America and China are growing, Brazil now has a bigger economy than Britain but that the UK seems to behave more like a euro-zone country, even though it is not part of the single currency.
During the stopover in Birmingham he visited the motor parts manufacturer GKN in Erdington, a company which is doing well despite the economic downtown – but believes they need more backing from Government.
“GKN is looking at a ten-year view. They are putting more investment in and are spending more on apprenticeships, but is the Government doing enough to back that kind of strategic investment for the future? Are we doing enough to back manufacturing and services?
“I asked what they needed from Government. They need a manufacturing plan and support for research and development.”
This all brings him back to a familiar theme and one he has mentioned several times during visits to Birmingham and the region, the demise of Advantage West Midlands.
“The big issue is what’s been put in place, who is standing up for the West Midlands industry. There’s a CBI voice and Chamber of Commerce voice, but you also need in government a strategic voice for business. And we’ve put in place local enterprise partnerships. These people are going to do their best but they have very little money and no levers, that is a weak business voice.
“LEPs are too small, they haven’t got resources and haven’t got leverage. We had nine RDAs, now we have 50 LEPs.”
Increasingly what you hear is business wants a strategy for investment jobs, instead they have a vacuum.
Although the Shadow Chancellor has appeared to endorse Birmingham mayoral candidate Sion Simon by attending a fund-raising dinner at The Cube in January, he seems to argue that a regional authority is needed – particularly on the economy and infrastructure.
The question over the city mayor becomes confused with the fractured LEP structure, but indicates that he lacks confidence that a mayor for Birmingham alone could deliver on the economy, transport and major infrastructure.
“I don’t think it’s a good idea to lose the partnership between Birmingham and Black Country. There’s people commuting across the metro border, housing policy, transport policy matters for the whole West Midlands. We shouldn’t reduce this down to an individual city.
“Decisions made about potholes is local, but transport policy, and things like tourism and universities are regional. Before we had strategic vision. I do worry that we have left a vacuum.”
Going back to his “mixing and plotting” and whether there will be any challenge to Ed Milliband from either Mr Balls or his wife, Shadow Home Secretary Yvette Cooper, he is asked whether he is happy with being Shadow Chancellor and instigates a classic dodge.
“It’s hideous, it’s got to change. I’m trying to drop the word Shadow. A phantom Chancellor and a Shadow Chancellor is no good.”
But can people trust Labour?
“The debate has now moved to the future, where’s the jobs and growth coming from? On policing and the NHS the Government is going in the wrong direction and losing trust. Our job is to say you can trust Labour on these.”