Brexit poses 'key risks' to Newport's economy, report says

This is according to research given to the local authority as they prepare for the UK’s intended departure from the European Union (EU).

Nearly five per cent of Newport’s population was born in the EU – the third highest in Wales – with the city also having a high number of foreign-owned businesses.

But the number of people from outside the UK being allocated a National Insurance Number, allowing them to work or claim benefits in Newport, has fallen by 31 per cent since the 2016 referendum.

READ MORE: Brexit: What happens next?

Advice from the Welsh Local Government Association (WLGA), which has been given to councils across Wales, asks Newport council to consider how changing migration patterns may affect its workforce and communities.

Newport, along with the other 21 local authorities in Wales, have been Brexit advice by the Welsh Local Government Association

“This assessment should consider the economy's scale, strengths, weaknesses, key sectors and productivity,” says the report.

“This will assist you to understand the local exposure to Brexit by sector and intervene or offer reassurance and support where necessary.”

High deprivation levels and low-skilled workers indicates ‘above average’ vulnerability to Brexit, according to the report prepared by Grant Thornton.

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Brexit could also ‘exacerbate’ tensions and hate crime within the community, suggests the report, with the council urged to promote community cohesion and respond to such issues.

Newport’s productivity accounts for six per cent of Wales’ economy – but the study predicts that a ‘hard’ or ‘soft’ Brexit could see gross value added (GVA) drop by 2.1 per cent and 1.2 per cent respectively.

There are also above average levels of employment in the motor trades and wholesale sectors, both of which have been identified by the UK Government as industries ‘most at risk’ from Brexit.

The report says: “Brexit poses a key risk to Newport in terms of GVA. The council should identify major growth catalysts that are at-risk.

“For example, regeneration and major infrastructure projects that could be delayed or stalled due to uncertainty on funding and/or demand assumptions.”

The Welsh Government has given local authorities an extra £1.2 million – or £45,000 per council – to prepare for Brexit. A further £200,000 is made available to them through the WLGA.

A WLGA spokesman said: “The money will ensure there is a dedicated resource in each local authority to undertake the necessary planning, co-ordination and preparation work.

“It will be supported and co-ordinated by the WLGA across all local authorities to avoid duplication, maximise effectiveness and encourage cross local government delivery.”