Economy of Cornwall

The economy of Cornwall, in the United Kingdom, is largely dependent upon agriculture followed by tourism. Cornwall is one of the poorest areas in the United Kingdom with a GDP of 62% of the national average, [Peter Kingston, 2005. " [http://education.guardian.co.uk/further/story/0,5500,1479952,00.html Closed for Business] ". "The Guardian", Tuesday May 10 2005.] and is one of four UK areas that qualifies for poverty-related grants from the EU (European Social Fund). Farming and food processing now puts £1 billion a year into the Cornish economy (2007) and Cornish produce is increasingly recognised for its exceptional quality. [ [http://www.cornishworldmagazine.co.uk/content/view/35/55/ Cornish World Magazine 2007] ] The Cornish economy also depends heavily on its successful tourist industry which contributes 24% of Cornwall's GDP and supports about 1 in 5 jobs (19% in Kerrier, Restormel and Scilly, 24% in Penwith, 23% in North Cornwall, 22% in Carrick and 14% in Caradon). [ [http://db.cornwall.gov.uk/ltp/marchannex2/chapter_57.html Cornwall Council tourism stats] ]

Statistics

This is a chart of trend of regional gross value added of Cornwall and Isles of Scilly at current basic prices [http://www.statistics.gov.uk/downloads/theme_economy/RegionalGVA.pdf published] (pp.240-253) by "Office for National Statistics" with figures in millions of British Pounds Sterling.

The official measures of deprivation and poverty at district and 'sub-ward' level in Cornwall show that there are large differences in poverty and prosperity in different parts of Cornwall and that though some parts are among the poorest in England, others are among the top half in prosperity. For example, the ranking of 32 482 sub-wards in England in the index of multiple deprivation ranges from 589th (part of Penzance East) to 30 477th (part of Saltash St Stephens), where the lower number represents the most deprivation. See also [http://www.cornwallstatistics.org.uk/index.cfm?articleid=35740 "Poverty and deprivation in Cornwall" (June 2006)] and [http://bris.ac.uk/poverty/Regional%20poverty_files/cornw/02SPA.pdf "Poverty and neighbourhood renewal in west Cornwall" (January 2002)] and [http://www.cornwallstatistics.org.uk/imd "Index of Multiple Deprivation in Cornwall'.

Traditional areas such as fishing and china clay extraction have gradually shed workers in recent years and the once dominant tin mining industry has been in steady decline since the late 1800s. The last working tin mine in Europe, South Crofty, near Camborne, finally closed in 1998, but in November 2007 it was announced that the mine may restart production in 2009. [ [http://news.bbc.co.uk/1/hi/england/cornwall/7074562.stm BBC News Nov 2007 - Tin mine aims to re-open in 2009 ] ]

Objective One funding in Cornwall

Cornwall didn't originally qualify for Objective One European funding until 1999 as previously the Government had statistically incorporated it with Devon in a process known as "Devonwall". Cornish demands for Objective One grant aid in the early 1990s for regeneration were often dismissed by Government officials as unrealistic and unobtainable but today many of the same officials see it as the miracle cure for Cornwall. In 1998 Cornwall was recognized by the UK Government as having "distinct cultural and historical factors reflecting a Celtic background" [ [http://www.publications.parliament.uk/pa/cm199798/cmhansrd/vo981022/debtext/81022-23.htm Hansard 1998 - Cornwall has distinct cultural and historical factors reflecting a Celtic background] ] , thus allowing it to be separated in a regional and economic sense from Devon. This fact underlines the importance of Celticity to Cornwall in recent years.

Because Cornwall had less than 75% of the average European GDP, £350 million of Objective One funding was received between 2000 and 2006. Despite claims of lax administration by the Government Office of the South West many beneficial things came of it including the Combined Universities Campus at Tremough. It has been fundamental to supporting and developing a largely indigenous food and farming industry which is now worth nearly two billion pounds a year - a lot more than tourism. Other sectors have also benefited are the 'creative industries' which have mushroomed with publicity and investment. Likewise tourism has profited and broadband provision was made a priority although there have been some complaints of fund mismanagement in cases such as the £2 million funding towards the failed South West Film Studios at St Agnes. [ [http://news.bbc.co.uk/1/hi/england/cornwall/4180307.stm BBC news Jan 2005 - Cornish Euro regeneration cash 'wasted'] ]

In 2005, Cornwall was estimated to have a GDP of 70% of the European average and although the then chancellor Gordon Brown was reluctant to facilitate it, Cornwall qualified once again for Objective One, the largest type of European investment. [ [http://news.bbc.co.uk/1/hi/england/cornwall/3501271.stm BBC news 2004 - EU cash to keep flowing] ] The next 'tranche' is called Convergence funding and will last between the beginning of 2008 to 2013 and will be worth £445 million. There have been many complaints from Cornish people that once again this investment will be managed from outside Cornwall, by the South West Regional Development Agency (SWRDA), in Exeter and Bristol and Objective One administrative jobs should in fact be based in Cornwall. Cornwall is the only Objective One region in the UK and Europe where the project is administered from outside the region. Priorities for the 2008-13 tranche will have a different emphasis on information and communication technologies, competitiveness, enterprise and a providing a skilled workforce.

There have been claims that European money has not created the regeneration that is required but has encouraged an unhealthy reliance upon tourism, grandiose projects and has helped stimulate population growth. This could lead to future problems of sustainability and over-development where soaring house prices are producing an increasingly divided Cornwall.

With limited public scrutiny and critical academic research on the Cornish Objective One project it is not known how much grant aid leaks out to organisations outside Cornwall. Also it is not known who fills the jobs created, whether they were resident in Cornwall or drawn in by the funding. No research has taken place into who benefits from Objective One funding. It has been claimed one effect has been to encourage a 'lifestye Cornwall' with a transformation of areas such as Padstow and St Ives into gourmet centres with an emphasis on leisure, up-market housing and theme parks. On the other hand there are many non-tourist areas characterised by high unemployment, low incomes and deprivation.

One of the first Objective One funded projects was In January 2002 when a £3.5 million factory was built by the South West Regional Development Agency (SWRDA) at St Columb Major with £1.7 million of Objective One funding. It was occupied by the American owned book, video and CD distribution company Borders Books, creating 90 Cornish jobs and was the company's national distribution centre. In March 2008 it was announced that the depot was to close in Cornwall. [ [http://news.bbc.co.uk/1/hi/england/cornwall/7292796.stm BBC news - March 2008 - Ninety Cornish jobs to go as depot shuts] ]

The Gaia Energy Centre at Delabole, opened in 2001 as a tourist attraction (on the site of Britain's first commercial windfarm). It cost £5m and was supposed to attract 150,000 visitors a year. It closed after three years of opening when it only achieved only a tenth of the required visitor numbers. Most of the funding for the centre came from Europe, with £300,000 grants from Objective One and SWDRA, the South West Regional Development Agency. [ [http://news.bbc.co.uk/1/hi/england/cornwall/3701894.stm BBC news - September 2004 - Energy tourist attraction shuts] ]

Tourism

Cornwall's unique culture, spectacular landscape and mild climate make it a popular tourist destination, despite being somewhat distant from the United Kingdom's main tourist centres. Surrounded on three sides by the English Channel and Celtic Sea, Cornwall has miles of beaches and cliffs. Other tourist attractions include moorland, country gardens and wooded valleys, and tourism is a significant economic sector.

Five million tourists visit Cornwall each year, mostly drawn from within the UK. [Cornwall Tourist Board, 2003. [http://www.cornwalltouristboard.co.uk/files/pdf/Revised_Tourism%20in%20Cornwall.pdf Tourism in Cornwall] .] In particular, Newquay is a popular destination for surfers. In recent years, the Eden Project near St Austell has been a major financial success, drawing one in eight of Cornwall's visitors. [Scottish Executive, 2004. " [http://www.scottishexecutive.gov.uk/library5/education/lrcas-14.asp A literature review of the evidence base for culture, the arts and sport policy] ".] The Eden Project has however been criticisedWho|date=December 2007 for never being financially self-sufficient and since its creation has received over £130m in grants from the Millennium Commission, Objective One European funding, SWRDA (South West Regional Development Agency) and Cornwall Council.Fact|date=December 2007 It recently (Dec 2007) lost its bid to receive an extra £50 lottery grant (for a major expansion) in a public vote. [ [http://news.bbc.co.uk/1/hi/uk/7140621.stm BBC News - Dec 2007 - Eden Project fails to win extra £50m lottery grant] ]

Industry

Other industries are fishing, although this has been significantly damaged by EU fishing policies, (the Southwest Handline Fisherman's Association has started to revive the fishing industry) [ [http://www.linecaught.org.uk/links.htm line caught wild bass from cornwall - south west handline fishermen's association ] ] , and agriculture, which has also declined significantly.

Mining of tin and copper was also an industry, but today no longer exists, and several defunct mines applied for status as UNESCO World Heritage Sites. [ [http://whc.unesco.org/en/list/1215 UNESCO Page on the Cornwall & West Devon application] ] However, the Camborne School of Mines is still a world centre of excellence in its field. [ [http://www.uec.ac.uk/csm/ The University of Exeter :: Cornwall Campus :: Camborne School of Mines ] ]

World Heritage Status was granted to the Cornwall and West Devon Mining area on 14 July 2006. This will allow Cornwall County Council the opportunity to expand its Mineral Tramways Project of walking trails along with re-instatement of engine houses and other places of mining interest. Completion of this network is expected some time in 2008. [http://www.cornish-mining.org.uk/]

Creative industries

In recent years Cornwall's creative industries have undergone significant growth, thanks in part to Objective One funding. There is now a significant creative industry in Cornwall, encompassing areas like graphic design, product design, web design, packaging design, environmental design, architecture, photography, art and crafts.

Taxation

In the October 2001 Business Age Magazine Kevin Cahill, an author and investigative journalist for the Sunday Times, wrote about the economy of Cornwall. In "The Killing of Cornwall", he notes that the London Treasury extracts £1.95 billion in taxes out of Cornwall's GDP of £3.6 billion. The Treasury returns less than £1.65 billion, so there is a net loss to Cornwall of 300 million pounds, where the total earnings figure is 24% below the national average. Cornwall is getting poorer by the day, and Cahill offers this explanation: "One very simple and easily provable answer is because the Government in London is raping Cornwall fiscally. The fiscal deficit of over £300 million all but completely explains the increasing pace of impoverishment in Cornwall." Cahill concludes his Business Age article with the lament that Cornwall will not recover until the gap between the tax take and the exchequer give is at least neutralised and better still, reversed.

outh West Regional Assembly and South West Regional Development Agency

On Tuesday 17 July 2007, Local Government Minister John Healey MP announced Government plans to abolish regional assemblies. Functions of regional assemblies are planned to pass to Regional Development Agencies in 2010. [ [http://www.danrogerson.org.uk/news?id=303 Dan Rogerson MP - New powers for Cornwall 'In sight'] ] [ [http://news.bbc.co.uk/1/hi/uk_politics/6903108.stm BBC news July 2007 - Regional assemblies will be axed] ] The South West Regional Assembly is due to be replaced by the South West Regional Development Agency in 2010. There was much opposition to the formation of the South West Regional Assembly with critics saying it is an unelected, unrepresentative and unaccountable "quango", and the area covered is an artificially imposed region and not natural. [ [http://www.mebyonkernow.org/ Mebyon Kernow opposes SWRA] ] This opinion is based upon geography, arguing that having the Isles of Scilly and Cornwall in the same region as Gloucestershire would be comparable as linking London with Yorkshire. [ [http://www.cornishassembly.org/ Senedh Kernow] ] The feeling is especially strong in Cornwall where in July 2000 Mebyon Kernow issued the "Declaration for a Cornish Assembly". [ [http://news.bbc.co.uk/1/hi/england/1704112.stm Government get Cornish Assembly call] ] In Oct 2007 Lib Dem MP Andrew George stated in a press release, "Just because the Government has approached the whole Regional Devolution agenda in entirely the wrong way, does not mean to say that the project itself should be ditched. If Scotland and London are benefiting from devolution then Cornwall should learn from this and increase the intensity of its own campaign for devolution to a Cornish Assembly." [ [http://www.andrewgeorge.org.uk/ Andrew George MP - Press Release 29th Oct 2007] ]

External links

*http://www.defra.gov.uk/erdp/images/nationalgifs/natmap2.gifCornish Objective One map]
* [http://epp.eurostat.ec.europa.eu/portal/page?_pageid=1996,39140985&_dad=portal&_schema=PORTAL&screen=detailref&language=en&product=Yearlies_new_regio&root=Yearlies_new_regio/F/fa/fab/fab11536 Cornwall and Isles of Scilly - regional gross domestic product (PPS per inhabitant in % of the EU-27 average)]

References