In the past week we've learned that IBM, Hastings Insurance Services and the Tejani family (who made £140 million from making toilet tissue) have been given £1 million each in Government grants to set up major operations in Leicester.
Another £3 million has been spent by Leicester City Council on refurbishing the city centre office block IBM will occupy.
Another £3 million has been spent by Leicester City Council on refurbishing the city centre office block IBM will occupy.
Why? Well for the reason politians always justify subsidising private sector investments - it's for the "greater good".
The argument goes is that this public money - via the Government's Regional Growth Fund (RGF) - has given these three businesses the confidence to make multi-million-pound investments in Leicester using their own money.
And all this investment means hundreds of new jobs for the city.
So that's at least 770 jobs created by these three firms (including the Tejanis' Leicester Tissue Company) at a cost of about £7,800 in public money per each job. Officials say this figure should fall as more jobs on top of those forecast are likely to be created.
But let's look at that £7,800 figure. It seems like a lot. But when you look at the many thousands of pounds of taxpayers' money it takes to get an unemployed person back into work, it doesn't look too bad value. Also, assuming all those employed are paid £16,000 per year, roughly the minimum wage for a full-time worker aged over 21, the Treasury will get at roughly £1,500 of this per annum.
However, things start to look a little more expensive when you look at the total 1,851 jobs created by almost 200 city and county businesses using £21 million of RGF cash over the past two years. It's a cost per job of £13,000. But I'm sure officials would also want to add the 1,005 of jobs which were also "safeguarded" by this funding. That makes it £8,400.
This figure can be quickly justified when you look at taxpayers handing out an individual Jobseekers' Allowance of more than £3,000 per annum.
Subsidising huge corporations and very wealthy people's businesses to help them expand and create jobs is a hardy perennial of a controversy, just like the giving of tens of millions of pounds of subsidies to major transport groups to run our railways, owners of hundreds of acres of farmland and those producing renewable power.
But what's the alternative? One could assume the purpose of "a regional fund" is to stop all successful businesses gravitating towards major cities such as London, Birmingham and Manchester. Perhaps if they had not been given a Government hand-out IBM and Hastings would have gone to one of those three cities.
Instead, with taxpayers cash to lubricate things along, it is understood IBM ended up with a choice between Leicester, Sheffield, Leeds and our neighbour Nottingham. They said they chose us because of the high numbers of quality graduates coming out of the city and county's three universities. They also liked the cut of the jib of those at the Leicester City Council and Leicester and Leicestershire Enterprise Partnership.
Officials have worked hard for the past few months to land these big businesses and get them to create their jobs here. But should these firms not follow through on the job numbers they have promised, they will have to pay money back or see the funds withheld.
Meanwhile, those who are employed by these businesses are going to be spending many thousands of pounds in the city and county each year, giving the economy a further boost.
I may not possess the computer power of IBM, but those sums look to me to be in the taxpayers' favour.
And all this investment means hundreds of new jobs for the city.
So that's at least 770 jobs created by these three firms (including the Tejanis' Leicester Tissue Company) at a cost of about £7,800 in public money per each job. Officials say this figure should fall as more jobs on top of those forecast are likely to be created.
But let's look at that £7,800 figure. It seems like a lot. But when you look at the many thousands of pounds of taxpayers' money it takes to get an unemployed person back into work, it doesn't look too bad value. Also, assuming all those employed are paid £16,000 per year, roughly the minimum wage for a full-time worker aged over 21, the Treasury will get at roughly £1,500 of this per annum.
However, things start to look a little more expensive when you look at the total 1,851 jobs created by almost 200 city and county businesses using £21 million of RGF cash over the past two years. It's a cost per job of £13,000. But I'm sure officials would also want to add the 1,005 of jobs which were also "safeguarded" by this funding. That makes it £8,400.
This figure can be quickly justified when you look at taxpayers handing out an individual Jobseekers' Allowance of more than £3,000 per annum.
Subsidising huge corporations and very wealthy people's businesses to help them expand and create jobs is a hardy perennial of a controversy, just like the giving of tens of millions of pounds of subsidies to major transport groups to run our railways, owners of hundreds of acres of farmland and those producing renewable power.
But what's the alternative? One could assume the purpose of "a regional fund" is to stop all successful businesses gravitating towards major cities such as London, Birmingham and Manchester. Perhaps if they had not been given a Government hand-out IBM and Hastings would have gone to one of those three cities.
Instead, with taxpayers cash to lubricate things along, it is understood IBM ended up with a choice between Leicester, Sheffield, Leeds and our neighbour Nottingham. They said they chose us because of the high numbers of quality graduates coming out of the city and county's three universities. They also liked the cut of the jib of those at the Leicester City Council and Leicester and Leicestershire Enterprise Partnership.
Officials have worked hard for the past few months to land these big businesses and get them to create their jobs here. But should these firms not follow through on the job numbers they have promised, they will have to pay money back or see the funds withheld.
Meanwhile, those who are employed by these businesses are going to be spending many thousands of pounds in the city and county each year, giving the economy a further boost.
I may not possess the computer power of IBM, but those sums look to me to be in the taxpayers' favour.
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