CAMDEN’S finance chief Theo Blackwell has been warning of the economic consequences of a Brexit vote for months, and his frustration spills over in a scathing response to last week’s EU referendum on Facebook. His basic theory on how a protest vote to Leave actually backfires is that the amount of money Camden brings in through business rates will go now down as hard-bargaining firms deal differently with the UK. This in turn will lead to less money for Camden to spend on public services, but also less being sent to areas like the north east where… the Brexit vote was strongest.
He uses more colourful language than that, but these are tense times. Here’s his take:
“As someone who has been in local government for 16 years, I should point out that – come 2020 – all funding for local services will be reliant on the business rates income stream from firms (bar the small % for Council Tax and fees). Note that the top 20 business rates collectors (out of 184 local authority areas) will basically ‘pay’ for the rest of the country’s children’s centres, libraries, swimming pools, parks, street cleaning, recycling, apprenticeship programmes etc through a yet undecided redistribution mechanism. (They do already, to an extent through a system of government grants).
“Most of these are in London, and the ‘top 4’ (including Camden) are the massive funders of this. So basically we have a situation where other (Brexit-voting) areas can angrily make their point but fuck the UK economy (we have 1.5% of GDP here in the most prosperous part of the borough), lowering foreign investment – making companies relocate – and lowering the benefit of business rate collection £s FOR EVERYONE (*excuse caps*).
“In a Brexit alternative big corps (and their huge local business supply chains) will leverage us – just like they have in during de-industrialisation in the Midlands and the North – to lower their taxes/give them a ‘deal’ or they will threaten to leave. This will have an impact on workers in those firms, said supply chains and the self-employed – now numbering 8m workers – not to mention the ripple effect of spending on the high street. No-one in London sees these firms as ‘local’, they are ‘UK’ firms and we’ve always accepted the concept of redistribution. I fear this will mean that we have less to fund services for other depressed areas of the country (and locally here) and will create a scenario where people will expect us to look after our own and argue for less redistribution across the country. I haven’t even started on capital programmes…or the political consequences.”