Revised version localism and sub national economic development

Localism and Sub National Economic Development

A new start or a cover for continuing renationalisation?

Kevin Richardson

• 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 region than 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 of Newcastle (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

’04 – ’10(or what part of ‘NO’?)

• Ministers for the Regions, Regional Grand & Select Committees, Integrated Regional Strategies, Regional Forum of Local Authority Leaders, Regionalisation of Funding Allocations, Transport Strategies, LSC, Business Link, Tourism

• Core Cities / City Regions / Sub Regions / Multi Area Agreements

• A new statutory economic ‘duty’ for local authorities. Local Asset Backed Vehicles, Supplementary Business Rates,

• City Development Companies, Economic Prosperity Boards

‘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

Transition of Government? Technology Strategy Board / Strategic Investment Fund

Technology Innovation Centres and Regional Growth Funds

Business Support Simplification Project

Abolition of LSC (and creation of YPLA and SFA)

Abolition of Regional Cultural Consortia & regional Arts Councils

The ‘top-slice’ of RDA budgets to pay for housing investments in the South East and the response to the closure of Teesside steel works

UK Finance for Growth (UKFG), UK Growth Capital Fund & UK Innovation Investment Fund

‘Merger’ of Government Offices, RDAs and Homes & Communities Agency

Local growth: realising

every place’s potential

"Our vision for local enterprise partnerships

will help transform the economic geography

of the country by creating a new local dynamism that will encourage economic growth and protect business with proper

local accountability."

Local Enterprise Partnerships• working with Government to set out key investment priorities, including transport

infrastructure

• coordinating proposals or bidding directly for the Regional Growth Fund;

• supporting high growth businesses, for example through …..new growth hubs;

• making representation on the development of national planning policy and ensuring business is involved in the development and consideration of strategic planning applications;

• lead changes in how businesses are regulated locally;

• strategic housing delivery, including pooling and aligning funding streams to support this;

• working with local employers, Jobcentre Plus and learning providers to help local workless people into jobs;

• coordinating approaches to leveraging funding from the private sector;

• exploring opportunities for developing financial and non-financial incentives on renewable energy projects and Green Deal; and

• becoming involved in delivery of other national priorities such as digital infrastructure.

Localism? or a cover for continued renationalisation?

• LEPs? For what purpose? Whose criteria?

• LEPs? What powers, (real) status, functions & money?

• (National) Regional Growth Fund

• Renationalisation of venture capital, business support, tourism, inward investment, international trade, sector policy, transport investments, employment programmes, EU funding

• Abolition of Government Offices?

Ongoing Challenges?• Much local delivery through agents of national government (Universities,

Colleges, Highways Agency, Job Centre Plus, Skills Funding Agency etc) all driven by central demands; lacking legitimacy to make difficult spatial decisions

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

• (Usually) risk averse local government of limited leverage, financial capacity, freedoms (and leadership?)

• No formal power hierarchy of local government. Ducking the political pain of hard administrative change and managing political and parochial aspirations.

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

• Investing in places of growth & opportunity, or in places of need regardless of opportunity? Investing where people want growth? Or where growth is not wanted? Jobs to people? Or people to jobs?

• The continuing economic impact of London