Government set to back Heseltine’s Birmingham blueprint for growth
IN a pre-Budget boost to the regions today, Chancellor George Osborne is expected to give the green light to proposals to create a new single funding pot to stimulate economic growth in areas of the UK outside London.
The move follows the release of the Greater Birmingham Project, a blueprint of how the recommendations contained in Lord Heseltine’s No Stone Unturned economic review could be delivered in the major regions.
However, the size of the pot is still uncertain. The former Deputy Prime Minister had proposed the network of Local Enterprise Partnerships be given greater powers to develop their own tailored local economic plans. From 2015-16 they would compete for a share of the single national funding pot to support growth over a five year period.
Under the current spending review this would account for £49bn of central public spending on skills, local infrastructure, employment support, housing, business support services and innovation. This would be supplemented by approximately £9bn of European common strategic framework funds.
Mindful of the need to temper growth ambitions with the amount of regeneration cash available in the Treasury’s coffers, it is likely Mr Osborne’s award will be considerably less, with forecasts predicting a possible £5bn.
The Government is in need of some positives as it heads into Wednesday’s Budget and the prospect of growth and appeasement to the regions might provide the short-term hit the coalition needs.
Lord Heseltine, accompanied by representatives of the Greater Birmingham and Solihull Local Enterprise Partnership, gathered in Birmingham yesterday to announce how the blueprint would work in practice.
Using the Birmingham LEP as a model, Lord Heseltine said: “The GBSLEP realises that the status quo is not an option when faced with the opportunities – and challenges – presented by a substantial Single Pot.”
The GBSLEP will therefore establish a ‘Supervisory Board’ comprised of the nine elected local authority leaders. This will provide clear political accountability for the management of the Single Pot.
The project also recommends making full uses of the economic resources available within the LEP area such as the growth of Birmingham Airport, the development of the M42 growth corridor – making full use of resources such as investment by the likes of Jaguar Land Rover and Rolls-Royce, plus investment to develop housing, transport infrastructure and skills.
In the GBP report, the M42 economic gateway in Solihull is described as “a fantastic opportunity, not just for Greater Birmingham and Solihull but also for the UK.”
The project would see the GBSLEP develop a strategic framework and development plan, through a Development Corporation – type approach or similar, which combines targeted investment in local infrastructure ensuring that the M42 Economic Gateway can fully capitalise on the investment opportunities that the expansion of Birmingham Airport and High Speed 2 will bring.
“The Single Pot will enable the far more effective pooling of local and central resources which can be used alongside other funding mechanisms – such as GBS Finance – and ensure that investment can be prioritised effectively and co-ordinated locally,” states the report.
Growth of Birmingham Airport is also recommended, which it said would generate wider economic benefits, such as creating up to 243,000 jobs as it grows to a capacity of 36 million passengers.
The recommendation also calls for an Enterprise Belt, which skirts the main Birmingham conurbation to factor in the needs of the other members of the LEP.
“The Single Pot approach provides the LEP with the transformational ability to bring all of these issues together into bespoke systems of support to ensure strong growth across different areas of the GBSLEP and neighbouring LEP economies,” it adds.
“It links completely to a new business-led business support programme, strategic account management, and bespoke access to finance solutions.
“This approach will focus on agreed economic zones such as the Advanced Manufacturing Hub in Aston and the Life Sciences Accelerator and other sites across the Enterprise Belt.”