C-charge will make companies relocate, says law firm

MANCHESTER will lose companies to the likes of Liverpool and Warrington if congestion charging goes ahead, according to one Manchester-based law firm.

Davies Arnold Cooper warns that companies will consider relocating outside the charging zone to stem higher employment costs.
 
Businesses could face demands for increased wages to cover travel expenses or flexible working to allow staff to avoid peak-time charging, it said.

And those employers in the city centre that don’t increase pay will struggle to retain staff who believe they would be better off working locally or commuting to towns and cities that don’t have a congestion charge.

Stephen Robinson, partner and employment law specialist at Davies Arnold Cooper, said: “Employers may face a huge challenge to retain workers who believe they will suffer financially from having to pay a daily charge to drive into Manchester. Companies may have to rethink their HR budgets and terms of employment to keep existing workers and attract new ones.
 
“Manchester’s ability to remain competitive may be under threat as the congestion charge will have a serious impact on a company’s ability to trade.”

Colin Sinclair, chief executive of MIDAS, Manchester’s inward investment agency, said it has major projects under negotiation that might stall or even fail without the investment in public transport that will come from TIF.

He said: “Recent reports, such as the Cushman & Wakefield UK cities monitor, indicate that easy access to customers and clients is the single most important factor in location decisions.

“We believe that ultimately the local talent pool will continue to travel to Manchester as a major employment centre and that by the time that the peak time only charge does come in, 2013 at the earliest and not before 2017 in Trafford Park, that many of us will already have changed our mode or time of travel.”

A spokesman for the Yes campaign said: “A great deal of research has demonstrated that the £3bn investment in Manchester’s public transport – almost all in place before charging – will expand labour markets and support growth, as such investment has in other cities. This includes those through Europe that have adopting a congestion charge.”

Unlike the scheme in London, Manchester’s proposed congestion charge would vary according to the time of day and place where a journey starts and finishes.

Current estimates put the cost to a commuter, who travels at peak times from outside the M60 into the city centre and back, at £5 a day or more than £1,000 a year. A referendum on the congestion charge closes on December 11.