Kevin richardson geography level 3 2011

Do plans of central government for economic growth reflect our spiky

economic geography?

Kevin Richardson

www.slideshare.net/30088

•Theory and a ‘spiky’ world

•Successively changing policies

•Current Case Studies

•Local Growth White Paper / LEPs

•Localism Bill

•Ongoing challenges

Some Theory

• O’Brien (1992) – the ‘end of geography’

• Cairncross (1997) – the ‘death of distance’

• Thomas Friedman (2005) – the ‘World is Flat’

• Krugman et al – NEG & agglomeration

• World Bank Development Report (2009): distance, density and difference

• Challenged by the OECD and the European Union

McCann (2010)

Headline GVA NUTS3

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

16 000

18 000

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

Hartlepool and Stockton-on-Tees

South Teesside

Darlington

Durham CC

Northumberland

Tyneside

Sunderland

GVA per capita index

50.0

60.0

70.0

80.0

90.0

100.0

110.0

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

Hartlepool and Stockton-on-Tees

Durham CC

Northumberland

Tyneside

Headline GVA NUTS 3

0

20 000

40 000

60 000

80 000

100 000

120 000

140 000

160 000

180 000

200 000

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

Inner London

Tyneside

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

• 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

Localism or Renationalisation?

• Abolition of RDAs, Integrated Regional Strategies, Regional Funding Allocations, Business Link, Primary Care Trusts, Audit Commission, Regional Tourism, Government Offices

• ‘rebalancing’ of economy (by sector, place, public / private)

• New Forms of local finance: New Homes Bonus, Business Rates Bonus, Tax Increment Financing

• But effective renationalisation of: Single Programme to (national) Regional Growth Fund, venture capital, (e.g. Jeremie), business support, tourism, inward investment, international trade, sector policy, transport investments, employment programmes, EU funding

• Local Enterprise Partnerships & Localism Bill

LEPS: An early critique• Assessed by the centre against which criteria?

• ‘Functional economic areas’ or administrative simplicity?

• Economic growth or sustainable development?

• Doing or thinking? Making difficult strategic choices?

• Accountable? To whom?

• No money, powers, functions, or hard status

Localism • Directly (imposed) Elected Mayors

• Local referendums

• Neighbourhood Planning

• Devolution and reform of Tax Base to the local level e.g. New Homes Bonus

Ongoing Challenges (National)

• Monetary policy: by definition global/ (inter) national; and effectively stalled

• Fiscal policy historically severe: no spatial element and/or Keynesian interventionism

• Unresolved reconciliation of neo-liberal supply side ‘people’ & firm economics with economic

importance and political transparency of ‘place’ economics

• Investing in places of growth and opportunity; or in places of need regardless of opportunity;

in places where people want growth or where growth is not wanted? Jobs to people? Or

people to jobs?

• Much local delivery through agents of national government (universities, colleges, highways,

Job Centre Plus, Skills Funding Agency etc) all driven by central demands; lacking legitimacy

to make difficult spatial decisions

• Departmentalism: what real traction from depleted departments of central government; of

CLG compared to HM Treasury, Cabinet Office, DWP.

• The continuing role of London

Ongoing Challenges (Local / Sub National)

• Enabler or direct actor?

• Dealing with huge cuts and Big Society / privatisation. Councils set free of red tape? Over 140 proposals for new regulations, order making powers, duties, statutory guidance and requirements on local authorities

• Dealing directly with central government – with far fewer intermediaries. As seen from the centre – (variably) risk averse local government; of limited & reduced capacity, leverage, freedoms and leadership(?) From grants to risked based investment finance e.g. Tax Increment Financing?

• From fuzzy boundaries of city-regions to confused boundaries; what relationships between Elected Mayors, LEPs, Police Commissioners, Transport Authorities, GP Commissioning Consortia, Work Programme, EU Programmes – each with a different boundary

• In absence of sub national spatial strategies, what future for cross boundary working e.g. housing, transport etc

• Dealing with the inevitable spatial implications of (national) space neutral sector policies. Will the private sector save us?