Boom of private sector jobs in the North is seeing it 'overtaking South East and London' for business growth

• Communities Secretary Eric Pickles said a ‘new economy is emerging’
• In Merseyside and Lancashire 48,685 new enterprises created last year
• It's an 11 per cent increase on previous year and three times rate in London

By James Chapman for the Daily Mail

Published: 18:49 EST, 26 February 2014 | Updated: 19:27 EST, 26 February 2014

Communities Secretary Eric Pickles said that a 'new economy is emerging' outside London

The boom of new private sector jobs and businesses in northern regions is beginning to outpace London and the south east, a Cabinet minister claims today.

Communities Secretary Eric Pickles said that under the last government prosperity had become dangerously concentrated in financial services in and around the capital, but the latest statistics suggested a ‘new economy is emerging’.

But he said that in Merseyside and Lancashire, for instance, there were 48,685 new enterprises created last year, an 11 per cent increase on the previous year and three times the rate in London.

Rather than relying on the public sector, Mr Pickles said there was clear evidence of a ‘diverse and balanced economy based on the innovation and entrepreneurship that lies at the heart of what makes Britain great’.

His remarks came as official figures boosted hopes of a secure, sustained recovery, showing the economy is becoming less reliant on consumer spending after a long-awaited surge in business investment.

The Office for National Statistics said business investment rose by 2.4 per cent quarter on quarter in the final three months of 2013, against expectations of 1.3 per cent.

Upward revisions to previous estimates mean it has also increased for four quarters in a row for the first time since 2007 and has increased 8.5 per cent compared with the previous year.

Gross domestic product rose by 0.7 per cent in the fourth quarter, the Office for National Statistics confirmed, unrevised from an earlier estimate and in line with forecasts - meaning the fastest rate of full year growth since the financial crisis.

Prime Minister David Cameron welcomed the figures, saying in they provided ‘more encouraging news our long-term economic plan is working’.

Samuel Tombs, UK economist at Capital Economics, said: ‘The second estimate of fourth-quarter GDP provides further reassurance that the economic recovery is becoming better balanced and is therefore sustainable.’

Deutsche Bank economist George Buckley said: ‘This provides some hope that the recovery is gaining breadth even if, as we expect, overall growth slows during the course of this year.’

The boom of new private sector jobs and businesses in northern regions is beginning to outpace London and the south east, a Cabinet minister claims today

Mr Pickles said that the Government’s economic plan had ‘profound goals’.

‘One of the many tragedies of the Labour years is that the self-proclaimed party of the many acted in the interests of just a few. Prosperity, financial security, opportunities - these were things restricted to too few parts of country,’ the minister said.

‘If you were from the south east and worked in financial services, then you were OK. But if you weren’t, then you were left behind. Changing this will take time but we are making progress.’

New figures show that in Nottingham, Derby, Leicester and the surrounding towns, more than 49,010 new apprenticeships were started last year, more than in the whole of London.

‘Young people in our former industrial heartlands getting the chance to develop practical skills, kick start a career and of course the chance to take home a decent pay-packet,’ Mr Pickles said.

In Birmingham, Yorkshire and Humberside the rise of private sector employment has been higher in every year since 2010 than in the boom years between 2000 and 2007.

In Coventry, the number of young people starting an apprenticeship has doubled, while in Liverpool, there has been a five per cent jump in the number of private sector jobs.

In places including Stoke-on-Trent, Tyneside and Plymouth, there is now seeing economic growth which is far outstripping the national average.

Mr Pickles claimed a new generation of enterprise zones, with significant business tax breaks, simplified planning permission and superfast broadband, was helping to encourage growth of the private sector in the regions.

New figures show that in Nottingham, Derby, Leicester and the surrounding towns, more than 49,010 new apprenticeships were started last year, more than in the whole of London (pictured)

‘Those conditions are attracting massive investment like the £800 million being put into Manchester’s Airport City by a British-Chinese joint venture, creating 16,000 jobs, or the £500 million being invested in the Black Country by Jaguar Land Rover: one of the great British brands spearheading the recovery,’ he said.

‘But there is still a long way to go. The job isn’t even half done, and nothing would be more dangerous than a return to the same old recipe of more spending, more borrowing and more taxes that Labour offers.’

The minister added that Britain could ‘look forward to the future with confidence’.

‘In April we’ll have the lowest rate of corporation tax in the G7, and thousands of employers will no longer have to pay employers’ National Insurance contributions, meaning they take more people on and provide more families with financial security.

‘The tax threshold will rise to £10,000 so no one will pay tax for the £10,000 they earn. In short, they take home more with every pay cheque.

‘I know from experience how much these changes will help. From behind the till at my father’s corner shop in Keighley I witnessed neighbours on a council estate working very hard for a wage and being able to keep their family secure because of that. It wasn’t easy at times but it had a big impact on me.

‘I’ve always believed that Government must create the right conditions to help anyone who wants to work hard and get on in life, to do so. It not only encourages economic growth but gives people the opportunity to support their own families.’

A Treasury spokesman added a note of caution: ‘As the Chancellor said last week the recovery is not yet secure.

‘The Budget next month will do more to support investment and exports, and the biggest risk to the recovery would be abandoning the plan that’s providing economic security for hardworking people.’