Chancellor should stimulate economy, says mayor Street

Speaking on LBC's Nick Ferrari show, Andy Street said stimulating economic growth should be Jeremy Hunt's priority.

When asked what he would do were he the Chancellor, Mr Street said he would focus on three main areas.

"Consumers have been really, really squeezed," he said.

"It is definitely right that if the Chancellor has some headroom, some reduction in headline tax to increase consumer spending power occurs.

"I would choose National Insurance, by the way, because it is clearly the most egalitarian piece that everybody pays pretty much flat rate.

"And all the talk of things like inheritance tax last time around was all wrong because it wasn't egalitarian."

But he said that alone would not be enough to bring the economy back from recession.

"The second thing is I would be looking very carefully at where we stimulate some of the most important sectors of our future growth.

"I'd also be talking about subsidies around innovation, around inward investment structures there. And then the other thing I would definitely do is continue the business rates holidays, because that for small businesses, particularly in retail hospitality, that is really, really hurting at the moment. And so I'd also spend some tax there. But the middle bit about thinking of the new sectors is really, really important."

Mr Street said while the collapse of the finances at Birmingham City Council was obviously not good for the image of the region, he said overseas investment in the area had continued to grow.

"What has been fascinating since this news broke in September, is that, yup, papers around the world, people have come to me, CEOs from around the world have come to me and said it says in the Bombay Times, it says in the Sydney Herald, 'Birmingham is bust'. But they still invest.

"And we've actually, at the same time as this news, had record inward investment. So the private sector still sees the success and the potential of the West Midlands economy. People can work out the council is one thing, the future of the city is a different thing."

Mr Street said the West Midlands' greatest assets were its universities and its skilled workforce.

"And one thing we're doing in the combined authority is continuing to improve that talent, that qualifications, and people are backing the citizens of the West Midlands," he added.