From Oecd To SNR

From the OECD Review of

Newcastle to the Sub National

Review: What real hope for

reducing disparities?

Public Service Agreement

Delivery Agreement 7

2008/09-2010/11

‘Improve the economic

performance of all English regions

and reduce the gap in economic

growth rates between regions’

HM Treasury (2007)

‘Government regional economic policy aims to narrow the gap in growth rates across the country. But this fails to recognise that economic performance has always been uneven. The ranking of cities’ economic performance has changed little over the years - cities have always grown at different rates, and they always will. Despite a long-term commitment to regional convergence, and billions of pounds of investment by RDAs, Local Authorities and other public bodies, little progress has been made’.

Centre for Cities (2010) Cities Outlook 2010 page 17

North East GVA where UK =100

74.0

76.0

78.0

80.0

82.0

84.0

86.01

98

9

19

90

19

91

19

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

ONS Regional GVA from www.statistics.gov.uk

GVA 2008

where UK =100

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

North East

London

GVA Durham & Tees Valley

where UK =100

60.0

65.0

70.0

75.0

80.0

85.01

99

5

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

ONS Regional GVA from www.statistics.gov.uk

• Central government is the dominant actor in regional economic development

• Collective action and identity appears to be as much rooted in localities and different cities within the regionthan the regional level, with internal and inwards looking divisions and animosities appearing to dominate. The basic conditions for building a mode of governance are therefore not strong

• There is, of course, no single best level for government organisation anywhere. Nevertheless, there is evidence from other OECD countries to suggest that governance arrangements at a metropolitan or functional urban level make sense for issues such as housing, transport, economic development, culture, organisation of retail, environment, universities, and land use planning

OECD Review of Newcastle in the North East

OECD Review of Newcastle in the North East

• The reality is that not all communities will benefit equally from the region’s growth…..it is for example clear that growth is coming form the urban core of the region and this is likely to continue.

• The concentration of growth and related resources in the City ofNewcastle (and Tyne and Wear County) suggests that in building the critical mass, the city region should strengthen the role of the urban core as the growth centre in building the critical mass.

• A focus on high technology sectors suggests a spatial concentration of development in the urban core of the region, with an accompanying transport strategy so as to improve the connectivity in the region and beyond, thereby enhancing the spatial mobility of the population

• [However] there is an ambivalence and lack of consensus in the region about the role of Newcastle in the region’s future.

• Finally, as the strategy requires choices to be made as to where (and where not) to put resource, a high degree of transparency in decision making, and political support are required

Increase in GVA 2006-07

0

1

2

3

4

5

6

Hartlepool and

Stockton-on-Tees

South Teesside Darlington Durham CC Northumberland Tyneside Sunderland

Pe

rce

nta

ge

ONS Regional GVA from www.statistics.gov.uk

Growth in GVA 2006-2007 at Current prices

0

100

200

300

400

500

600

700

800

Hartlepool and

Stockton-on-Tees

South Teesside Darlington Durham CC Northumberland Tyneside Sunderland

£ m

illi

on

ONS Regional GVA from www.statistics.gov.uk

Headline GVA at Current Prices

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

£ m

illi

on

Hartlepool and Stockton-on-Tees

South Teesside

Darlington

Durham CC

Northumberland

Tyneside

Sunderland

Sub National Review

• Streamlining the regional tier; including Ministers for the Regions, Regional Grand Committees, Regional Select Committees, abolition of Regional Assemblies ‘in their current form’, RDAs to prepare Integrated Regional Strategies?…local authorities to have stronger role of scrutiny over RDAs…a new regional Forum of Local Authority Leaders

• Delegation of RDA funding to local authorities ‘where capacity exists’

• A new statutory economic ‘duty’ for local authorities. Support for establishment of City Development Companies; use of Local Asset Backed Vehicles, Supplementary Business Rates, Working Neighbourhoods Fund

• Encourage groups of local authorities to develop ‘Multi Area Agreements’to agree collective targets for economic development

• Allow ‘sub regions’ to strengthen sub regional management of transport

• Allow groups of neighbouring local authorities to establish statutory sub regional arrangements

Sub National Review: A Critique

• To strengthen ‘every tier’ and ‘all local authorities’

• Effecting spatial prioritisation within new Integrated Regional Strategies? Led by economic policy or by land use?

• What role for Ministers of Regions? Regional Forum?

• Delegation of RDA funding to local authorities….for what purpose? …and on what basis? … who determines capacity?

• Core Cities not mentioned despite showing strongest growth

• What is it to be? city regions or sub regions? or neighbouring local authorities working together?

• MAAs …no statutory or financial basis…no money….so what motivation to change behaviour or prioritise on a spatial basis?

Problems for Central Government

• Legislative: Retrenchment of institutional positions during lengthy passage of primary legislation. Quasi judicial role of RSS. Implications of general election?

• Departmentalism: What real traction from Depart. Communities & Local Government compared to HM Treasury, Cabinet Office, DBIS, DWP? What impact of revolving Ministers?

• A real shift of spatial prioritisation during cycle of fiscal tightening?

• How to reconstruct RDAs to perform a new and different task?/ What role for Government Offices in the Regions?

Problems at the Sub National Level

• Local government of limited leverage, financial capacity & freedoms

• In the absence of more elected Mayors, how to build capacity of risk averse local authorities?

• Continuing artificial administrative boundaries (and establishment of unitary county authorities in some places)

• No power hierarchy of local or regional agencies of government

• Much local delivery through agents of national government (LSC, Job Centre Plus, Homes & Communities Agency, Universities, Regional Development Agencies etc) driven by central demands; lacking legitimacy to make difficult spatial decisions

• What relationship between Local Area Agreements and Multi Area Agreements?

Bigger Problems?

• Unresolved reconciliation of traditional (HMT led) neo-liberal supply side ‘people’ & ‘firm’ economics with growing importance and political transparency of ‘place’ economy

• Investing in places of growth & opportunity, or in places of need regardless of opportunity?

• Managing the apparent retreat (of some departments) from the regional level and easily from explicit target to Reduce Regional Disparities

• Managing political and parochial aspirations of heavily represented rural areas, formal industrial and coastal towns, suburban areas etc

• Political gain or political pain?

• …..as the government maintains the massive scale and economic importance of London and greater South East by quietly pouring cash into London & South East e.g. T5 & Runway 3 at LHR, High Speed 1, expansion at Stansted, Cross Rail, Olympics, Thames Gateway etc