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| Teesside shops await budget as steelworks closure reverberates | Teesside shops await budget as steelworks closure reverberates |
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| It costs £1.35 for a Victoria sponge in Yasmin’s halal bakery on Middlesbrough’s Parliament Road. That’s for a whole cake, not just a slice. “We charge what we can,” said owner Shazad Ahmed, describing his shop as the “Asian Greggs” as he tried to tempt us with a jumbo samosa (58p). Business is not booming: “We’re just covering our costs at the minute.” | It costs £1.35 for a Victoria sponge in Yasmin’s halal bakery on Middlesbrough’s Parliament Road. That’s for a whole cake, not just a slice. “We charge what we can,” said owner Shazad Ahmed, describing his shop as the “Asian Greggs” as he tried to tempt us with a jumbo samosa (58p). Business is not booming: “We’re just covering our costs at the minute.” |
| When the SSI steel plant 10 miles up the road in Redcar shut in October with the direct loss of 2,200 jobs and the same again in the supply chain, the reverberations were felt across Teesside. “It has a knock-on effect for us. With the steel workers not having any jobs, they aren’t going to come and spend money in our businesses. They haven’t got no money no more,” said Ahmed. A customer, Tan Hanif, chipped in: “If that steel complex was in London, the government would have put money into it and kept it open.” | |
| Related: Budget 2016: George Osborne fuels speculation of nasty shocks | Related: Budget 2016: George Osborne fuels speculation of nasty shocks |
| Yasmin’s is in Gresham, a deprived urban area which often hits the headlines for the wrong reasons. Eleven years ago, the town’s infamous mayor, ex-detective Ray “Robocop” Mallon, called Gresham a “cancer”, announcing plans to bulldoze 1,453 terraced homes and replace them with shiny new ones. The scheme had to be abandoned halfway through when Mallon ran out of cash, leaving streets with big chunks missing from the middle as if hit by a bomb and not a wrecking ball. Unsurprisingly, few people want to live in an area that looks like a warzone. Now many of the houses not boarded up are occupied by asylum seekers, whose complaints that their properties’ red doors made them a target for racist abuse made the national news in January. | |
| Gresham could not be more different from Knutsford, the chi-chi Cheshire town with its Aga and supercar showrooms where George Osborne has been MP since 2001. But what Osborne announces on Wednesday is likely to affect the struggling residents of Gresham more than his well-heeled constituents. | Gresham could not be more different from Knutsford, the chi-chi Cheshire town with its Aga and supercar showrooms where George Osborne has been MP since 2001. But what Osborne announces on Wednesday is likely to affect the struggling residents of Gresham more than his well-heeled constituents. |
| Waiting for fried rice at the Chinese chippy on Parliament Road, one single mother, who fits in 16 hours of work a week around childcare, said she was worried the chancellor would try again to take away her working tax credits. “Nobody in my family ever worked,” she said. “I’ve gone on to work when my parents didn’t, now I’m trying to show [my kids] a better life by working. I get a little bit of help with tax credits and if they stop that then my kids aren’t going to be able to think of work as a game. If they cut it, it’s not going to make it worth working.” | Waiting for fried rice at the Chinese chippy on Parliament Road, one single mother, who fits in 16 hours of work a week around childcare, said she was worried the chancellor would try again to take away her working tax credits. “Nobody in my family ever worked,” she said. “I’ve gone on to work when my parents didn’t, now I’m trying to show [my kids] a better life by working. I get a little bit of help with tax credits and if they stop that then my kids aren’t going to be able to think of work as a game. If they cut it, it’s not going to make it worth working.” |
| In the queue behind her, one man was much more optimistic. Ken Tabner, 69, a semi-retired businessman, was visiting from Manchester, the centre of Osborne’s “northern powerhouse”. Over there it’s “buzzing, absolutely buzzing”, he said. “Everything is growing.” He wants Osborne to be more generous to pensioners and less generous to the jobless: “In life, you only get out of it what you put into it, so I’m not one for giving. You have to earn it. I think he should do something to encourage that.” | In the queue behind her, one man was much more optimistic. Ken Tabner, 69, a semi-retired businessman, was visiting from Manchester, the centre of Osborne’s “northern powerhouse”. Over there it’s “buzzing, absolutely buzzing”, he said. “Everything is growing.” He wants Osborne to be more generous to pensioners and less generous to the jobless: “In life, you only get out of it what you put into it, so I’m not one for giving. You have to earn it. I think he should do something to encourage that.” |
| Related: Life after steel: can Redcar rise from the ashes? | Related: Life after steel: can Redcar rise from the ashes? |
| At the last count, before SSI went under, 14% of Tees Valley residents were claiming out-of-work benefits, compared with 9.2% nationally. But some businesses, such as tech startup Spearhead, are confounding the grim statistics and expanding. | |
| Currently surviving on cans of Red Bull and a few hours sleep a night, founder Dan Riley, 32, said business was going so well they were soon to move to a bigger office. “Being based here isn’t necessarily a disadvantage from an industrial standpoint and we have a huge amount of natural beauty here,” he said. “Yes, the nightclub scene isn’t as strong as it is in Newcastle or Las Vegas but you’ve got to be based somewhere. And here we have access to great clients, a great business community, great mentors and graduate talent that we can leverage to help the business reach its full potential.” | |
| In June 2014 at Manchester’s Museum of Science and Industry, Osborne set out his vision of joining together the “great cities” of the north of England as a counterpart to London and other global metropoles. Teesside does not have any cities, but it is home to James Wharton, Conservative MP for Stockton South and, since May last year, minister for the northern powerhouse. | In June 2014 at Manchester’s Museum of Science and Industry, Osborne set out his vision of joining together the “great cities” of the north of England as a counterpart to London and other global metropoles. Teesside does not have any cities, but it is home to James Wharton, Conservative MP for Stockton South and, since May last year, minister for the northern powerhouse. |
| Teesside has yet to reap the benefits of having a cheerleader in a ministerial position, according to Middlesbrough’s elected Labour mayor, David Budd, who took over from Mallon last May. Sitting by the floor-to-ceiling windows of Mima, the Middlesbrough Institute of Modern Art, he conceded that the northern powerhouse was a “laudable” concept, despite its architect. “It does still surprise me greatly that it’s a Tory government that has given us this opportunity. I can’t quite get used to that.” He says his daughters temporarily disowned him after he was photographed shaking Osborne’s hand and smiling with local leaders as they signed a Tees Valley devolution deal last October. | |
| But there are mixed messages coming from Osborne, he said, citing the chancellor’s decision to roll out the red carpet in Manchester for the Chinese president, Xi Jingping, just as the SSI steel works went under in Redcar: “That visit went down very badly here because one of the reasons that SSI closed was the cheap dumping of Chinese steel in this country – 95% of what they dump in Europe comes to the UK. Unforgivable.” | |
| Brian Dennis, 50, worked at SSI for 26 years and became a Labour councillor in May. He said he had applied for “hundreds” of jobs since October and had only just been invited for his first interview. He has begun studying for a health and safety qualification but most of the jobs are elsewhere. “I know a lot of lads have moved up to Shetland. There’s a lot of lads who’ve took on jobs that necessitates travel on a daily basis throughout the country, so they’re not with their families at home of a night, they’re stuck in a hotel,” he said. | |
| Other firms who relied on the steel works have already gone under, he said, including a fabrication company and a recruitment agency owed £500,000 by SSI. Without the steel industry, Redcar’s future is bleak: “This was a town that was built on steel. That blast furnace was the beating heart of Redcar.” | Other firms who relied on the steel works have already gone under, he said, including a fabrication company and a recruitment agency owed £500,000 by SSI. Without the steel industry, Redcar’s future is bleak: “This was a town that was built on steel. That blast furnace was the beating heart of Redcar.” |
| Fifteen miles inland from Redcar is the pretty market town of Yarm, which has the most affluent high street in Wharton’s constituency. It is a different world: three boutique florists jostle for business on the high street, a young butcher sells crocodile steaks and artisanal “parmo”, an artery-fuzzing Teesside speciality which piles bechamel sauce and grated cheese on to a deep fried chicken escalope. | |
| Late last year, the jewellers had to move into bigger premises, they were doing so well. “It’s been doom and gloom for a number of years. I think the north-east is getting a little bit better; it’s starting to pick up,” said shop assistant Colin Ramsey. And yet, he said, “the only part of great Britain that’s really doing well is London”. | |
| He quite likes Osborne “believe it or not”, but is sceptical about his plans to redistribute the UK economy to make it less Londoncentric: “Taking power away from London is a good idea but how’s he going to do it? That’s where the money is, that’s where people invest, that’s where the companies are. My daughter moved away from the north-east because she wanted a good job. She got a degree in business at Teesside university. We train them up here but they have to go to London because there’s no company that can keep them in the lifestyle that they want. They want the big house and the big car and you can’t get it in the north-east. Therein lies the problem.” | He quite likes Osborne “believe it or not”, but is sceptical about his plans to redistribute the UK economy to make it less Londoncentric: “Taking power away from London is a good idea but how’s he going to do it? That’s where the money is, that’s where people invest, that’s where the companies are. My daughter moved away from the north-east because she wanted a good job. She got a degree in business at Teesside university. We train them up here but they have to go to London because there’s no company that can keep them in the lifestyle that they want. They want the big house and the big car and you can’t get it in the north-east. Therein lies the problem.” |
| On the other side of the high street, Stephanie Richardson’s family have been running Strickland & Holt, a coffee shop-cum-emporium of everything since 1854. Though a fan of Wharton, she is worried about the future. “We are nervous, particularly about the minimum wage going up by almost a third over the next few years.” | On the other side of the high street, Stephanie Richardson’s family have been running Strickland & Holt, a coffee shop-cum-emporium of everything since 1854. Though a fan of Wharton, she is worried about the future. “We are nervous, particularly about the minimum wage going up by almost a third over the next few years.” |
| She was surprised the policy had come from the Conservatives: “Although it would be very nice to pay everybody what they want and what they need ... and it’s totally fair to have that ambition, I think it may well have a big effect on every high street in the country.” | |
| The shop’s manager, Paddy Morton, said business was up year-on-year – he credits the upturn with the fall in petrol prices and low mortgages, which gives people more money in their pocket to spend on fripperies such as coffee, scented candles and Strickland & Holt’s trademark Yarm salad dressing. But any recovery based on oil prices is precarious, he says. “If that changes and interest rates go up, we’ve got to somehow pay for the living wage with possibly less business.” | The shop’s manager, Paddy Morton, said business was up year-on-year – he credits the upturn with the fall in petrol prices and low mortgages, which gives people more money in their pocket to spend on fripperies such as coffee, scented candles and Strickland & Holt’s trademark Yarm salad dressing. But any recovery based on oil prices is precarious, he says. “If that changes and interest rates go up, we’ve got to somehow pay for the living wage with possibly less business.” |
| Richardson looked worried. “We’ve got £250,000 wage bill in Yarm, can you imagine what that’s going to do to us if it goes up by a third? Our margin will disappear and we have to find a way of getting that back. We are very nervous about that ... The government needs to think of the many thousands of small businesses who will struggle with this.” | Richardson looked worried. “We’ve got £250,000 wage bill in Yarm, can you imagine what that’s going to do to us if it goes up by a third? Our margin will disappear and we have to find a way of getting that back. We are very nervous about that ... The government needs to think of the many thousands of small businesses who will struggle with this.” |