Call for Northern development agency

A super development agency to lead the economy of the entire north should be created through the merger of  the Northwest Regional Development Agency and its counterparts in Yorkshire and the North East, a think tank suggested today.

The Centre for Cities said the move would create an economic powerhouse reducing the north-south divide, and would boost the revival of cities including Liverpool.

The independent organisation said the RDAs are not delivering on their two-part government target of reducing the gap in economic growth rates between the  English regions, and secondly promoting growth in all regions. 

It says during the first seven years of the RDAs existence (1999 to 2006), the economy in the South East grew by nearly 18%, whereas the rest of England’s economy grew by just 15% – and predicts the growth gap will continue over the next decade.

Across the Greater South East, the economy generated £22,657 per head, in 2006 – more than £6,000 more than the rest of England.

The main purpose of RDAs should be to help boost growth in lagging areas. The report suggests a number of options for the next government to consider, including:  A Northern Development Agency, from 2011, to replace the current three northern regional development agencies. Cities like Liverpool and Sunderland would benefit from being part of a unified “northern” brand, rather than three separate RDAs, it says. 

It claims a  Northern Development Agency would be more strategic. It would build better links between the two biggest northern city-regions, Greater Manchester and Leeds City Region – and create more space for them to take on more powers and deliver housing, transport and jobs.

The Centre for Cities argues that such a move would replace the government’s “confusing regional economic performance target” with a clearer focus on boosting growth rates and promoting job creation in the Midlands and the North – rather than trying to close the gap with the  South East.

Dermot Finch, director of the Centre for Cities, said: “There is great uncertainty about the future of RDAs. The government says they are all crucial, but the Tories say they are terrible. The truth is somewhere in between: RDAs are needed more up north, less in the Greater South East.

“We will not need an RDA in every English region, for the next ten years. RDAs should be streamlined, and focused on boosting growth in lagging areas. After the next general election, a single development agency for the north of England would be a good way forward.”

Steven Broomhead, chief executive of the Warrington-based Northwest Regional Development Agency, said the report “makes an interesting contribution” to the debate, but said the recession mean there was more pressing work to do.

“We will make note of the content but now is not the time for debating regional structures. We are focused on working with government on the important and immediate issue of helping support North West businesses as best we can in this challenging economic climate and the existing RDA structure ensures we can respond quickly and effectively in each region.”

“For example, since September the NWDA has announced over £200m of additional business support and we are looking at ways to extend this further, including the new transition loan fund, which will make at least a further £10m available to support businesses in our region.”