Growing Cities…interesting developments in England….

July 8, 2012

Nick Clegg, MP and Deputy Prime Minister in the United Kingdom, is currently overseeing the renewal of England’s major cities. In December 2011 he announced a major initiative for the eight largest other than London which is seeking to rediscover the entrepreneurial spirit of those cities. In doing so the policy makers in England have recognised, as in many other OECD countries, that economic development for city regions requires a separate policy perspective from addressing rural development or the development of smaller urban centres. This is a lesson which might usefully be applied in Ireland.

The English Cities are seen as critical to the overall economic regeneration of the national economy. However the deputy Prime Minister has recognised that all too often, the over centralised approach to public service reform in England has emasculated local interests and drivers so that in an ever-moving world economy English cities have been sidetracked or bypassed by their more nimble neighbours on mainland Europe or in the United States and Australia. This might be something which might find resonance in several city regions in Ireland. As a result a specific Minister for Cities is now, under the political patronage of the Deputy Prime Minister, driving reform in the economic role of the English cities. A cities policy unit placed critically within the Cabinet Office and not the Department of Communities and Local Government, has been established, replicating the successful Australian version.

Underpinning the idea of creating innovative and successful cities, the policy initiative envisaged a relatively immediate role over of powers from Whitehall to the City Authorities. New powers for the cities which would enable civic and private sector leaders to influence the key decisions that affect their economic competitiveness; and/or deliver innovative projects to unlock growth in each area. These powers were to be agreed between the relevant local and national authorities. A series of possible themes were set out including: giving greater freedom to invest in local growth with less central overview and borrowing sanction; added powers to drive critical infrastructure including, if relevant, the merging of infrastructure providers back into local government (also currently underway in Queensland and Germany); provision of competitive funding to lever private investment in public infrastructure; and an enhanced role to boost job creation and skills.

Of course the UK Government, and Whitehall in particular is not known for its kindly regard for city government! The Deputy Prime Minister set out a clear set of obligations for the cities if they were to be beneficiaries of his new inking, a key pillar of the Localism Agenda under Prime Minister Cameron.

Clegg obliged the Cities to provide greater leadership and accountability: He made it clear that where cities want to take on significant new powers and funding streams, they would need to demonstrate strong, accountable leadership, an ambitious agenda for the economic future of their area, effective decision-making structures, and private sector involvement and leadership (cities with a directly elected mayor, he noted at the time, would meet this requirement).

He also focused on outcomes and efficiency: in agreeing to devolve powers or support licensed exceptions, he demanded that the cities would need to demonstrate that they have clear goals in terms of improved outcomes or reduced costs and a plan for achieving these goals.

The process was to be based on risk and reward: Clegg suggested that just as cities would want to reap the rewards of new powers and projects in city deals (for example, retaining a portion of additional business rates), they must also be willing to take on proportionate risks and put their own resources forward as part of the deal.

This would require new levels of innovation and creativity through the local-national deals Whitehall would agree with the cities to encourage them to be creative and innovative in how they use both new and existing powers to maximum effect to boost private sector investment.

A critical role for the private sector was envisaged with growth in the cities being primarily driven by private investment. The cities would need to demonstrate that they are taking decisive action to boost private sector growth, supported by strong, dynamic partnerships between public and private sector leaders and open and more localised public services and governance: the UK Government, like many, is striving to create more responsive, efficient and open public services. Clegg stated that as the cities take on new powers and responsibilities, they would need to demonstrate what actions they will take to deliver open public services through greater choice, decentralisation, diversity, fairness or accountability. And cities will need to show that they have clear plans to promote the use of the range of powers available to communities, including those provided by the Localism Act.

Clearly a break with the past!

The benefits of having such a policy centred in the Cabinet Office under the direct leadership of the second most powerful minister on the Cabinet now seems to be bearing fruit. In the first wave of announcements, only 7 months since the policy initiative, the UK Government has agreed with each of the Cities, a range of reform packages tailored to their specific needs.

Greater Birmingham and Solihull, Bristol and the West of England, Greater Manchester, Leeds City Region, Liverpool City Region, Nottingham, Newcastle and Sheffield City Region will all see the transfer of substantive powers from the centre to their local arrangements. In doing so Bristol envisages the creation of 40,000 enterprise jobs along with over €1.2 billion of enterprise investment while the various local authorities in Birmingham will be working to deliver some 10,000 life sciences positions and up to €18 billion enterprise investments over the coming 25 years.

The ten local authorities in Manchester will be given powers to implement “The Greater Manchester Deal” which, they envisage, will support 40,000 jobs in the next 20 years, and 6,000 apprenticeships for young people, alongside new powers which will allow Greater Manchester to ‘earn back’ up to £30m a year of national tax form the growth it creates.

Dublin’s near neighbours in Liverpool…the authorities of Halton, Knowsley, Liverpool, Sefton, St. Helens, Wirral…have come together to deliver a strategy which will support over 35,000 people into work and create 6,000 apprenticeships through new powers over skills and employment, alongside delivering an international Business Festival which will deliver £100m return on investment.

England is not generally regarded as a source for good ideas but those that were behind the late lamented Gateway Initiative in Ireland might look on and weep at the speed of the progress under Clegg.

Any chance some-one might give him a call?