Public finances will show huge budget deficits for years to come - and as public spending is cut to bring in the deficit, cities across the UK will be hit proportionately harder The time for talk is through, the recession is deepening - will a taskforce be enough?
But while the politicians talk, the recession is deepening. According to a new report by the Centre for Cities, Liverpool and Belfast are among those most exposed to economic downturn, with both suffering already high unemployment and an under-qualified workforce making recovery more difficult - nearly a quarter of Belfast's working population has no formal qualifications.
"In order to avoid a longer, more painful fight-back from recession, city-by-city front line solutions are needed now to tackle their problems head on - and lead UK PLC to recovery," says Adam Marshall, head of policy for the Centre for Cities think tank.
Liverpool has been here before. One of the most iconic images of the recession of the early 1980s was that of Michael Heseltine, then a cabinet minister in Margaret Thatcher's government, striding through the city in the weeks after the infamous Toxteth riots of 1981.
Heseltine's taskforce set up the Merseyside Development Corporation with the remit of rebuilding Liverpool, the legacy of which can be seen in the Albert Dock development and the Wavertree Technology Park.
"During the 1970s, Liverpool was a city in total despair," said Heseltine when he visited Merseyside two years ago. "Today it is the most exciting urban renaissance we have seen since Victorian Britain. The spirit that made Liverpool great in the 17th and 18th centuries has been restored."
But as Liverpool is placed on red alert for a new, painful downturn, some are asking: how effective was the Heseltine taskforce?
"The Heseltine taskforce was successful in making physical advances in Liverpool city centre," says Marshall, suggesting that politicians favour spending money on new buildings as a tangible way of demonstrating progress. This is a city that suffered 50 years of decline, he says, and 10-15 years of recovery. Heseltine laid the groundwork, which in turn encouraged private property investment, much of it from Ireland. But there is still much to be done.
Liverpool is similar to Dublin in this respect, he says. "North Dublin shares many of the messier, harder-to-solve social issues with north Liverpool - the types of challenges that are now going to limit their ability to emerge quickly from recession."
A feature of this recession will be the role of the public sector - a separate report suggests around 60 per cent of local GDP is generated by state spending - and the government is a dominant employer on Merseyside.
Public finances will show huge budget deficits for years to come, adding further to the plight of Liverpool and other cities across the UK - as public spending is cut to bring in the deficit, they will be hit proportionately harder.
The situation calls for emergency measures aimed at helping the jobless into employment and protecting viable local businesses from the credit crunch. One method could be to defer rate payments and alter local taxes to ease cash flow. These levers however, are not in the power of local government, says Marshall, who has lobbied for cities such as Liverpool, Manchester and Birmingham to be run by an elected big city mayor, like in London.
This recession however, might require more than the setting up of another taskforce.
