FINANCE

Reclaiming our regions

Twelve months into a five-year project examining how to build more inclusive regional economies, Tom Lloyd Goodwin highlights four emerging priority areas for the next UK Government to address.

With their power and resources to improve economic development, transport and regeneration, combined authorities are bringing clout, spending power and scale to our regions after a long time and yet devolution remains a work in progress.

Systemic and pronounced inequalities still blight our regions, with significant gaps in power, wealth, opportunity and health resulting in shorter, sicker and less fulfilling lives for many people.

This is why the Centre for Local Economic Strategies (CLES), the New Economics Foundation (NEF), Co-operatives UK and the Centre for Thriving Places (CTP) have come together to create the Reclaiming Our Regional Economies (RORE) programme. It will operate until 2028, alongside three pilot combined authority areas, to bring communities together with political and institutional leaders to test ideas that help rewire and reform their economies, so they deliver good lives now and for generations to come.

In the first year of our work on RORE we have been able to observe first-hand the triumphs and challenges combined authorities, communities and their partners face. Reclaiming Our Regions is our account of what we have observed in that year and what we have learned about why devolution is necessary and valuable.

From skills and employment programmes to help those furthest from the labour market, through to new models of democratic business support and the use of citizens assemblies to address climate change, we have been heartened by the raft of practical interventions emerging from combined authorities and their partners to create more inclusive regional economies.

We also foresee huge potential for further development. On the skills and employment agenda, and mirroring local initiative such as ICAN in the West Midlands, combined authorities could look to work more closely with local partners to link skills development and training opportunities to guaranteed jobs for those furthest from the labour market, albeit at a greater scale.

On spending too, combined authorities could look to co-ordinate the economic demand generated by the goods and service needs of local councils and other anchor institutions and help target this towards local democratic businesses.

There are challenges. Underpinned by a system of deal-making, our paper reflects the fact that combined authority areas individually negotiate these deals and often end up signing agreements with relatively limited decentralisation of power and resources.

And then there is the economic framing. Shaped by a strong directive from Westminster and the Treasury to boost economic growth, combined authorities are limited in the ways they can use their resources to forge economic futures that recognise the individual strengths and aspirations of their regions.

The plight of councils also has implications. With one in five councils now facing bankruptcy over the next year, local government continues to be hampered by inadequate funding settlements which in turn affects its capacity and ability to plan long-term and contribute its resources to inclusive regional economic development programmes.

These shortfalls need to be prioritised by the next Government of the UK and our paper highlights four emerging priority areas to be addressed.

First is funding. The systematic underfunding of local authorities, which predates but has been worsened by austerity, has a knock-on effect for combined authorities and local communities. This needs to be remedied as soon as possible. Without a long-term view on funding, local authorities simply cannot carry out the kind of planning required to support and scale-up the examples of practice we share in our paper to reach their full potential.

Second, the Government at Westminster needs to set broader targets beyond gross value added (GVA) contribution. Measures around environmental sustainability, falling inequality and raising wellbeing should be baked into devolution settlements.

Third, combined authorities should be given explicit permission to bring people together to innovate and find new solutions. Whether it is in transport, housing, health, economic development or any other significant area of public policy, regional economies should be encouraged to experiment in uniting people and communities, involving them in the direct development and delivery of a vision for their areas.

And finally, deeper democracy. We need to see public participation in local policy-making. To move towards an economy where all can flourish, it is vital to create more opportunities for ordinary citizens to shape the economies of the places where they live and work. Local and combined authorities should be allocated specific resources to enable greater public participation – through citizens' assemblies, for example – as well as more resources to develop social infrastructure.

For more than a year we have been working to understand what communities, councils and combined authorities can do to build more inclusive regional economies.

As our work continues over the next four years we expect to share more insights as our understanding and depth of knowledge in these communities evolves.

If you would like to keep up to date with the RORE and all we are doing, please get in touch.

Tom Lloyd Goodwin is director of policy and practice at the Centre for Local Economic Strategies 

X – @tomlloydgoodwin

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