It’s hardly surprising, given the dire state of the economy, that AWM is having to cut funding for a number of projects in the region. After all, it’s had its budget cut by central government by £48m and has seen a significant drop in return from its own assets. However, this isn’t just a story about a budget squeeze and the pressure on public finances. Projects in the region are also being cut because AWM has been forced by the government to re-direct £64m of its funding, earmarked for regeneration schemes, into support for business. On the face of it, this is no bad thing. If ever there was a time for businesses to get extra help, then it’s now, as they struggle to cope with the worst recession in 80 years. However, I’m not convinced that the support AWM is funding is measurable in any way or is going to make any tangible difference. Take the £3.5m ‘Automotive Recovery Programme’, announced yesterday. Apparently 120 companies are to be ‘assisted’ and up to 1000 jobs safeguarded by AWM’s delivery of up to £50,000 of ‘specialist strategic consultancy’. Is this what companies really want at the moment? Consultancy? Wouldn’t a cut in regulation, support in retaining staff and improved access to bank funding be more helpful?

It doesn’t make sense to stop funding projects by, for example, Thinktank and the Black Country Living Museum - projects which are helping to safeguard jobs and attract tourism into the West Midlands – and to spend the money instead on (relatively) small packages of consultancy support. And it will be fascinating to see how much of the total £64m is actually taken up by businesses. After all, the £2.3bn loan fund set up for the automotive sector in January has not yet been successfully accessed by a single company.