West Midlands Growth Company tipped for reform
The West Midlands Growth Company (WMGC) is set to undergo significant reform over the next year, as stakeholders admit that the region is “not getting the economic impact needed from the investment it wins”.
It will undergo a transition at a cost of £7.25m to become a smaller economic development vehicle by 2026/27, with reduced leadership and back-office capacity.
The new approach has been recommended in documents ahead of the West Midlands Combined Authority (WMCA) board meeting on November 15, to “secure investment, market our region and its places, support businesses and clusters and drive innovation”.
The agenda for the board meeting says that the region’s “economic performance has declined since 2020” and is experiencing “serious, long-term structural challenges” including “youth unemployment, low wages, fuel poverty and low skills level”.
Challenges have driven WMCA leaders, local authorities, and WMGC representatives to opt for a transformation rather than a complete shutdown of the current model. The new vehicle will work to “avoid duplication, overlap and fragmentation”.
There will be greater visibility to the Mayor and leaders to minimise the funding requirement for the transition year. Governance of the transitional Growth Company will also be reformed and will be directly accountable to the WMCA board with a more streamlined private-sector board accountable for the WMGC operation.
During this transition, the WMGC will continue its inward investment activities and support for the visitor economy, which is projected to secure between 1,500 and 2,400 jobs in the region.
Richard Parker, the Mayor of the West Midlands and Neil Rami, CEO of the WMGC said in a statement to TheBusinessDesk.com: “Our businesses, universities, colleges, chambers and trade bodies we have in the West Midlands are ones to be truly proud of, and the structures and support around them should make it as easy as possible for them to invest, grow and expand.
“So we are taking a new approach to business growth and delivery which will include a clearer delineation of purpose and objectives across areas such as inward investment, business support, research, marketing and tourism.
“The aim of this is to make a clearer and fuller offer to our business community while positioning the West Midlands as one of the world’s most attractive places to do business.”
According to WMCA documents, this phased approach is seen as the most “sustainable way” to “allow vital delivery to continue in parallel to avoid losing momentum and skills, allowing essential talent, knowledge and relationships around core inward investment, capital attraction and tourism to be retained for the future”.
2025/26 will be a transition year, with the existing WMGC refocussed and restructured with a new board.
Alternative options were considered, including a complete shutdown of the WMGC, which would have cost £3.5m and likely resulted in the loss of 25 to 35 major investment opportunities. Another option involved continuing the Global Growth Programme alongside the inward investment strategy, which could have secured an additional 1,900 to 2,800 jobs, as well as 500 more in 2026/27 — but this option would have required a higher transition cost of £8.2m.
