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The Government is taking a new approach to economic development - partly because it has to, but also because it wants to. Ministers want to rebalance the economy towards the private sector and the North. However, they have to try to do it cheaply. As business secretary Vince Cable said last month: "Government is no longer in a position to promote growth through fiscal stimulus."
By 2015/16, the Government will be spending £99 billion a year less than Labour's 2009 plans. Net public investment will fall from the £49 billion spent last year to £21 billion in 2015/16 (remember that two-thirds of these cuts were in Labour's pre-election Budget. It's just that Labour never told us exactly what they would cut).
That means much less government capital for housing, transport and other infrastructure. It also means the end of regeneration as we know it, the need for innovative financing tools for development and the start of a new era for struggling areas - where the goal is less about transformation and more about adjusting to economic reality.
