Regional Policy Experience in the UK
The UK includes four historical provinces - England, Wales, Scotland and Northern Ireland (Ulster) - part of Ireland in six north-eastern counties. Administratively, Great Britain is divided into counties , counties and cities. The local authorities are responsible for housing construction, education, social security, police, fire services. They have significant tax revenues both from entrepreneurship and from individuals living in settlements.
For many centuries, Britain was a unitary state, and all major issues were resolved in London by the parliament and the government. The situation has changed significantly in recent decades. In 1998, the Assembly of Northern Ireland was elected, in 1999 - the National Assembly of Wales and the Parliament of Scotland. A number of important socio-economic functions are transferred to them. At the same time, the regional autonomy of Greater London is being developed in England itself, and the powers of counties, and especially municipalities, are increasing. Together with city mayors, count and municipal councils acquire significant rights in the field of tax policy, organization of local life, regulation of entrepreneurship, social policy. Decentralization of management occurs in conditions when regional authorities are increasingly involved in the political system of the EU.
All counties and cities elect their municipal (city) councils, they form administrative committees responsible for specific areas, primarily the socio-economic life of the population, the development of local territories. These councils deal with issues of housing, social assistance to poor people, education, health care, regulate the activities of entrepreneurship, develop tax projects, create infrastructure. In general, they have ample opportunities to implement local regional policies.
The UK economy has always been characterized by strong differences between individual regions. In the UK, neither in official publications, nor in scientific works, it is unambiguously stated which areas and areals should be classified as depressive. Officially there are "development areas" - the territory where the location of economic objects is stimulated by the state. Usually depressive include the Northern District of England, Scotland Wales, the Northwest Region. In this case, analysts usually call the following reasons for the lagging behind of depressed areas in the UK:
o specialization in outgoing industries with insufficient development of new and new ones;
o high dependence on traditional industries and weak development of services and infrastructure;
o Peripheral position - remoteness from decision-making centers and the most capacious markets;
o bad investment climate due to the depressiveness and peripheral situation of the region.
These signs are revealed in the analysis of specific depressive areas and their structure. So, Scotland has long been concentrated in such traditional industries as coal mining, ferrous metallurgy, shipbuilding, heavy engineering, textile industry, etc. Their decline in 1970-1980's. strengthened the protracted economic crisis in the UK. The need for major reforms was obvious, but for this there was no financial resources. The discovery of rich oil fields in the North Sea promoted the development of oil refineries and chemical enterprises in the region, provided the government with large financial resources for carrying out reforms. In the 1990s. in many formerly depressed regions, including in Scotland, the development of the electronic industry, various types of information technology has been developed. Here, modern enterprises, banks began to concentrate, and enterprise services were developed. Similar processes occurred in Wales, in which coal mining and ferrous metallurgy were also developed. Great interest in the region, including coal fields, is shown by European and other foreign companies. Two of the largest agglomerations - Liverpool and Manchester - are characterized by considerable backwardness, despite the fact that in the last two decades the situation in them has significantly changed for the better.
In the 1980-1990's. The depressed areas embarked on a path of accelerated development: along with the modernization of the "old" branches here appeared electrical engineering and radio electronics, automobile, aircraft, instrument making, etc. However, it is necessary to emphasize one feature - in these areas mass production is located, and management and scientific units are concentrated in the south of the country.
Thus, in Great Britain there have long existed regional and socio-economic imbalances. This necessitated the implementation of specific state measures to mitigate them: the creation of new cities, industrial and scientific parks, and financial assistance to the regions. When determining the regions that need assistance, the following indicators are taken into account: the unemployment rate, the level of development of production, the prospect of creating new jobs. The main goal of the regional policy is to create a replacement for the old industries on which the economy of depressed areas was based, improve working conditions, ensure a high level of access to education, treatment, recreation, etc.
Until the early 1980's. emphasis was placed on bringing in the "development areas" large companies from other regions, primarily the South-East, as well as foreign capital. This was achieved both by direct financial benefits, and by developing infrastructure. In the 1990s. the emphasis was on the development of small business, as well as modern information production, the provision of substantial benefits to large capital in these regions, in particular in the North and North-West (Scotland, Wales, Ulster, Northern Ireland). Although this direction of politics has brought some success, it was viewed as too modest.
This was one of the reasons for developing a state program aimed at encouraging the migration of people from densely populated areas to depressed ones. The transfer of companies from the Western Midlands and the Southeast (the most developed regions) to the "development areas" was encouraged. At the same time, new construction was limited in the Southeast area. All this activity was directly carried out with the participation of the county authorities, with whom the work of the central government was coordinated in the development of the program. In support of regional programs, the "business zones" were created, which were located on small plots of land where industrial and commercial enterprises operating on preferential terms were formed: exemption for 10 years from property and land tax, preparation of qualified personnel at the expense of the state. At the same time, the government's financial assistance is selective: projects that create new jobs and production, increase existing production capacities, improve the quality of goods and services and are knowledge-intensive receive approval.Special areas of the UK subsidized by the government, belong to the category of government-subsidized areas. Such selective support is also known as the regional policy. In the UK, such areas are mainly areas with a share of the unemployed, well above the national average, but other criteria, such as per capita income or economic growth, can also be used. Subsidized areas first appeared in the UK in 1934 under the name "special areas" (special areas). Then they were reorganized and expanded as "development zones", and in 1966 merged under the name "developing areas" (development areas). In 1967, they added special developing areas (special development areas), and in 1970 - intermediate areas (intermediate areas). In 1984 another reorganization was carried out with the creation of a two-tiered system of developing and intermediate regions, as well as a significant revision of their classification and a change in the policy of regional financial assistance. Since April 1988, the Ministry of Trade and Industry has abolished regular regional development subsidies, and thus regional assistance to developing and intermediate regions is distributed exclusively at the discretion of the ministry and can only be provided when the ministry is convinced of the absence of other sources of investment. Introduced in these areas in 1988, business subsidies are aimed at helping medium and small enterprises pay for consulting services. A special set of rules has always been in place for Northern Ireland.
The regions of Great Britain, which receive state aid to industry in various forms, are classified as developing areas (development area). This assistance, which is part of the regional policy ), consists mainly of subsidies for investment in industry, paid "automatically", although there may be selective or one-time assistance. Developing areas were established in 1966 in place of pre-existing development zones and cover most of Scotland, North England and Wales. A little more assistance is provided to special developing areas (special development areas). The creation of developing regions can be seen as a reaction to a relatively high level of unemployment in some regions of the country.
The EU factor in British regional policy
A significant impact on regional policy in the UK is provided by the country's membership in the European Union. The EU assists companies in the "development areas" UK within 20-30% of the project cost, depending on the category of the area.
In general, it should be noted that the country's regional policy is significantly supplemented with financial resources from various funds and institutions of the EU. The British quota in the European Regional Development Fund (established in 1975 ) was from 21.4 to 28.5% of its total value until 2004 (before the massive expansion of the EU). Since the foundation of this fund, Britain has received over 4 billion pounds. of which approximately 950 million pounds. Art. came to Scotland, 550 - to Wales and the Northern District, 600 million pounds. Art. - to the North-West region. Basically, the funds from the fund came to the county and county authorities to create various infrastructure facilities. Nowadays, priority is given to regional development programs: in this case, subsidies from the fund cover up to 55% of the state's costs.
The European Social Fund also sends a significant portion of its funds to the aid of the "development areas" Great Britain. He pays up to 50% of the costs associated with the retraining of those who lost their jobs as a result of the restructuring of the economy and industry, helps them to find employment.
The European Investment Bank provides concessional loans for the needs of the "development areas", which can cover up to 50% of the costs. Assistance to the crisis areas of the UK comes also from the European Community of Coal and Steel (ECSC) - these are concessional loans, assistance in building housing for miners and metallurgists when they move and train.
All this undoubtedly contributed to a significant leveling of socio-economic conditions in modern Britain.
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