Political Editor Lucy Ashton looks at how the city is taking action to ride out a huge dip in the economy.


ONE item of news is dominating the headlines each day.

Britain – along with the rest of the world – is in the grip of a credit crunch and there is a constant debate about whether we are heading for a recession.

Sheffield's council and business leaders are already putting action plans in place to safeguard the city – and are on standby for a downturn in the economy.

No-one can predict what is going to happen and some people believe it's the biggest upheaval in the global economy since the 1930s.

Council and business leaders say the key to heading off a recession is to be flexible, adaptable and prepared.

They believe that, so far, Sheffield is in a good position to weather the storm.

Sheffield Council chief executive John Mothersole said declining global demand, the credit crunch and high food and energy prices were hitting households.

But he said although Sheffield faced tough times it was less vulnerable than Manchester, Leeds, Bristol and Edinburgh.

"We are going to hurt but others will hurt more. Our economy is in quite a good position to go into the next few years," said Mr Mothersole, who admitted the council itself is facing a tough time.

He said: "The council's income is down and we have less money. We will probably need to employ fewer staff and change the shape of our services. The council will have to anticipate changes and be flexible.

"We have enough funds in place this year but next year we have to look at what's happening and whether we have to cut back.

"We are carrying on with all the essential work – and every new school will be going ahead as these have largely been funded with Government money. The deals have already been done as we were quick off the mark several years ago."

Along with safeguarding its own finances, the council also has to support the city's residents. There are thousands of council tenants who are feeling the pinch.

Mr Mothersole added: "At the moment we are only seeing a slight rise in people presenting themselves as homeless but we expect further rises and greater demand for advice around housing.

"We want people to be coming to us the minute they think they have a problem."

Council leader Coun Paul Scriven is aware everyone is going to face a harsh winter.

"I know that people are coming under real financial pressure from spiralling costs for everyday essentials such as food, petrol and energy bills.

"At the same time many people are worried about their mortgages and jobs. As a council I believe we have to do our bit to try to help in any way possible.

"The council is responding in a number of ways, including exploring ways of maintaining a supply of affordable housing and ensuring we have systems in place to advise and aid people who fall on hard times."

He believes the city has to sit tight and ride things out.

"Sheffield is no different to anywhere else and we will be affected by economic conditions.

Evidence shows our housing market is more stable and Sheffield's modern export manufacturing businesses should not be as adversely affected as some sections of business.

"This downturn will become an upturn and we must prepare for that.

"The council and its partners have a plan to put Sheffield in the best place possible to withstand the bad times and make the most out of any opportunities.

"This includes things like investing in local people's skills so they have better job prospects and moving in the real estate market to secure important sites for future development.

"I'm very clear that we are not going to lower our ambitions and we are focused on the long term."