Written evidence from Professor Alan Townsend
EXECUTIVE SUMMARY
— It is possible in principle to establish
sub-regional bodies as alternatives to RDAs, but a skeleton staff
should remain from the longer-established government Regional
Offices (1994 and earlier).
— However, the transfer of many powers
upwards to London civil servants may cause familiar problems and
present UKTI with conflicts of interest; an alternative is to
retain one other foreign promotion body, for the area recognised
for the Regional Growth Fund.
— Experts indicate that some functions
work best at Regional level and some at sub-regional, ie as in
proposed LEPs.
— There is a strong business interest in
co-ordination of 368 "lower-tier" soon-to-be independent
Local Planning Authorities, and fear of wasteful competition between
LEPs.
— The writer is one of the few people who
have worked across both Economic Development and Town Planning,
both as Councillor, Partnership Chair and Professor, and would
adduce strong evidence for "the suggestion that Local Enterprise
Partnerships may fulfil a Planning function" as per the CLG
Select Committee on Abolition of regional spatial strategies.
— i.e. planning, housing and transport
are not only necessary to LEPs' working but need LEPs strengthening
with formal Planning powers for essential purposes of BIS and
government at large, and to complement the advances provided by
localism.
— Problems of co-ordinating Committees
and Departments in London may be offset by saving agreed parts
of draft integrated Regional Strategies, and re-convening Leaders'
Boards with business bodies in Regions that want this, co-ordinating
LEPs.
BUSINESS, INNOVATION
AND SKILLS
IN LEP AREAS
1. There is a range of functions which are best
performed at the level of "functional economic areas",
for which LEPs are expected here to constitute a minimum of two
upper-tier local authorities. These functions include business
development, business grants, social enterprise, further education,
skills and some kinds of tourism.
2. Among present Partnerships between Local
Authority areas, including notably some Cities, there are firm
precedents for a successful approach to economic development where
political conditions are propitious and the need clearly exists.
3. LEPs should improve the forward planning
of training between Colleges, Job Centre Plus, business and public
sector employers in developing strategies, including use of existing
statistics of employment change from the National Online Manpower
Information System.
4. However, the loss of RDAs and government
Regional Offices (GOs) is significant as for certain functions
they are irreplaceable at the LEP level. A Regional economic function,
for instance in processing EU grants, was part of the specialist
functions of GOs as from 1994 when they were consolidated by the
last Conservative government. Predecessors of BIS all previously
ran their own Regional Offices, which extended back continuously
to the War under Board of Trade, for two purposes; firstly to
develop, research and apply past Distribution of Industry policy
for areas and Regions of unemployment, and secondly to provide
access for other day visits to local firms by staff concerned
with export promotion and some regulation. While it is accepted
that Regional machinery had recently grown too large, access to
private sector factories and offices is needed by a range of branches
of government, and it is not correct, despite some CLG statements,
that this is superseded by the internet
5. Many policies of RDAs benefitted from regional
knowledge and negotiation, including major innovation policies
which still require a view of cultural industries and universities
across a wide area.
6. It is accepted that having several RDAs with
offices abroad to promote inward investment was open to criticism.
Nonetheless, the last meeting of the Committee established with
the Secretary of State that UKTI attracts the majority of its
enquirers to the south of England. This is to be expected from
normal research evidence held by Economic Geographers. As it is
now accepted that areas eligible for the Regional Growth Fund
require positive assistance, this would present a conflict of
interest and priority for UKTI. This will need offsetting with
a joint body with intelligence and a brief for that area. A possible
scheme would be based on the "Northern Way" (combining
hitherto the strategies of the North West, Yorkshire and the Humber
and North East RDAs), extended to add at least the Midlands RDAs.
7. There is an argument for retaining small
government staffs in Regions to provide a minimum of intelligent
co-ordination of London departments' activities, at least for
the areas further in travel time from London. If on that basis
the southern Regions did not claim this need, then the government
would be entitled to implement a distinction between North and
South, which matches frequent practice in many analyses and books.
PROBLEMS FOR
THE BUSINESS
OF LEPS
8. All this said, there are expected to be many
problems in establishing a fully viable set of LEPs, even (as
above) for BIS topics alone. Much of the precedent for this lies
in the establishment by the last government of sub-regional partnerships,
voluntary at the point of entry to Local Authorities (variously
known as Multi-Area Agreements, Economic Prosperity Boards, Economic
Improvement Areas and City Regions), for which a small "grey
literature" exists on CLG sites.
9. Negotiations between local authorities over
these agreements have shown constant flux, with authorities withdrawing
over particular issues, and associated changes of name. Disagreements
between Local Authorities over the September submission of draft
LEP proposals are active at the time of writing. Differing political
control among authorities and changes in control from future elections
will inevitably provoke attempts to withdraw from previously harmonious
agreements (This was one major reaction to a lecture given by
the author in South America on City Regions).
10. This variation is one reason why the Office
for National Statistics recently found great difficulty in defining
a standard set of City Regions for England. They have also declared
to an inter-departmental committee that their contract arrangements
preclude them providing fresh economic statistics for LEP areas
(other than by summing existing, more limited series for constituent
areas of LEPs in present data-bases).
11. The view of researchers in this field is
that the post-war co-ordination of Authorities in conurbations
has been particularly difficult beyond the sphere of maintaining
statistics. The strength with which Partnership agreements have
been pursued is extremely variable. Thus the possibility of building
a reasonably consistent set of LEP areas, boards and functions
is not very great within one parliament: if different LEPs are
pursuing different sets of topics at different speeds, then the
question may arise among businessmen of a "postcode lottery"
of assistance.
12. This author is not equipped to anticipate
the likely funding of LEPs from different sources. However, resources
are key. He would emphasise as a member of two Local Strategic
Partnerships over 5 years, and Chair for one, that interest and
activity relate very fundamentally to the supply of money: when
it is all allocated for one year, then the dynamic and level of
attendance (sadly) fall off very clearly. Resignation of business
members from LEPs is to be expected when they find that they are
spending a lot of time on public sector procedures over little
resource.
WIDER CO
-ORDINATION OF
ALL FIXED
INVESTMENT BY
LEPS
13. The needs of the economy are intimately
bound up with the topics of housing, transport, infrastructure
and planning. This long-overdue integration was embodied in increasing
work between ministries, prompted by business, in integrated Regional
Strategies, which were to be signed off by BIS and CLG jointly.
It was equally correct that the letter of June 29th announcing
LEPs was signed jointly by the Secretaries of State of both BIS
and CLG.
14. It is argued here that it is necessary for
LEPs to embrace all these topics: and that not as another "talking
shop" but as bodies having statutory Planning powers at the
centre of their individual work. If, as often stated, LEPs are
responsible for "real economic areas", then they must
embrace the economy, housing, transport and planning together.
None of those topics can be dealt with at a lower level like that
of most Local Authority areas.
15. To argue this from a business point of view:
much as one might welcome aspects of devolution to the 368 Local
Planning Authorities, the withdrawal of Regional Spatial Strategies
without replacement nonetheless leaves a vacuum of uncertainty
for business investment; as mentioned in a letter to the Secretary
of State of 24 May:
"Briefly, having 368 separate Planning Authorities
could produce:
— Unco-ordinated wasteful competition between
new shopping centres
— Unco-ordinated buck-passing by between
nimby southern authorities
Such points were frequently in the FT till two
months ago, including representations from the Home Builders Federation..."
16. The British Chambers of Commerce asked members
in June about spending cuts and how they rated competing claims
for future spending. This survey of business leaders (PLANNING,
30th July, p.6) said that transport and regional development should
be the main priorities for government spending in the autumn review.
Business is very concerned over rational development of transport,
whereas the division of the map into 368 units is inimical to
this; as in my letter of 26 July to the Minister for Decentralisation
— "My first role in Teesside arose
from the fact of huge disagreement between independent LPAs [Local
Planning Authorities]. Imagine the A19 passing Teesside on the
west from Wolviston to Crathorne, as proposed by the then Durham
CC. That was what prompted Department of Environment to require
Teesside Survey and Plan, whose analysis proved the road would
be more valuable on its present route, and inspired the long-respected
Teesside Structure Plan.
— Only this week, Durham CC are resolving
a major disagreement between the most local and adjoining areas
over the impact of diverting a flow of opencast coal to rail
— My point at QEII [Conference Centre]
was that a major development area straddles the boundary between
Stockton and Hartlepool Boroughs. My recent consultancy work there
brought out painfully the point that the otherwise excellent Partnership
(existing and proposed) between Tees Valley Authorities leaves
them as entirely independent sovereign Planning Authorities. Most
Planners say that dropping Strategic Planning will, at the very
least, put an end to important cross-boundary developments. The
proposed LEP (otherwise no doubt satisfactory) will not deal with
this problem unless LEPs are LPAs".
17. In turn it is a mistake to exclude allocation
of new employment land from the brief for the new Planning system,
as does the CLG Select Committee in seeking views on "the
arrangements which should also be put in place to ensure appropriate
cooperation between local planning authorities on matters formerly
covered by regional spatial strategies (eg waste, minerals, flooding,
the natural environment, renewable energy etc.)"
18. The allocation of employment land by the
Planning system is of great interest to business. For example,
successive strategies for North East England since the arrival
of the Nissan factory have allocated a small, set number of sites
for large inward investment: otherwise all the present 12 Unitary
Authorities would wastefully allocate one each.
19. The location of new growth is the more advantageous
if it is carefully calculated in relation to that of existing
and new housing and transport for goods and personnel. This objective
is jeopardised by the ending of strategic planning; quoting the
editor of PLANNING 9th August, p.9)
"Following the scrapping of regional spatial
strategies, just over half [of 70 LPAs surveyed] expect to review
their local development framework housing targets|Only one in
five authorities will review employment targets|How many employers
will spend big bucks investing in an area if there are serious
doubts about housing their staff?
This is the planning system's equivalent of the emperor's
new clothes. A key purpose of spatial planning is to balance potential
jobs with homes. It seems a funny way to attract inward investment,
build confidence and firmly embed economic recovery"
20. In short, although the legal apparatus of
Planning has to lie with CLG and Local Government, the business
and housing interest is different from the outcome of what 368
Local Authorities might decide. The last government responded
to business and Treasury influence in legislating for merging
Regional Economic and Spatial Strategies. This may have proved
too cumbersome, but the lessons must be learnt, that there needs
to be economic input into Planning. It is not the sum total of
what Councillors on District Planning Committees might think,
and say to CLG ministers through their national associations
21. It is now therefore argued here that LEPs
are of value to Planning and vice versa
(1) It is necessary at all stages that
Planning is part of LEP work, but
(2) That is not sufficient as the only
proposal to fill the vacuum between the 368 Authorities and Whitehall,
(3) LEPS must have Planning powers: otherwise
much of their work could prove nugatory: for example, a LEP containing
say five Boroughs could find its separate Planning Committees
voting to develop or approve rival out-of -town shopping centres,
despite previous broad accords.
22. It is now argued that the LEP level is
the only one at which to resolve the strategic co-ordination of
Planning. This statement does not reflect criticism of the
dropping of the Regional Spatial Strategies as such, but the surprise
of many bodies and of academics at their dropping without replacement.
23. Background: In the sphere of Economic
Geography "functional economic regions" have been recognised
since for example a work of 1947, "City, Region and Regionalism"
(R.E.Dickinson, Routledge). As part of their professional training
of up to 5 years, all Planners are taught the inevitable growing
interdependence of adjacent towns and suburbs for the activities
of work, housing, shopping, leisure and services, which have to
be taken account of in providing land, engineering calculations
of road needs and Planning approvals. By the end of the 1960s
the Ministry of Labour was linking local authority areas together
in "Travel-to-Work" areas. It was a normal requirement
of Ministry of Transport that new roads could be financed only
by calculating detailed forward travel needs in "Land Use-Transportation
Surveys" for conurbations and larger growth centres such
as Northampton. The Metropolitan Counties of 1974-85 had their
own Structure Plans which survived the closure of those Authorities.
It is argued here that these plans provided the basis for continued
growth of transport and green belts, and that they could not have
been produced by the present separate Metropolitan Boroughs or
present-day Integrated Transport Authorities.
24. RDAs have met almost unresolvable conflict,
sufficient to risk losing regional projects, between metropolitan
boroughs. A `law of the jungle' would leave disadvantaged communities
further behind, Bradford behind Leeds, or deprived ex-coalfield
areas behind those with Motorway junctions and would serve in
the end to deny the very sense of responsibility which looks after
present-day Britain. Present local authorities are too small to
embrace concrete strategic issues. When we look at the eight leading
provincial cities (for which the Conservatives would recommend
having separate elected mayors), we find that the average proportions
flowing in from adjoining areas summed to no less than 42 % of
all workers already by 2001, while many Local Planning areas of,
for example, the East Midlands lose about half of their resident
workers to adjoining areas for work.
25. It is argued here that LEPs provide a scale
at which future essential strategic planning should continue (while
saving essential parts of the recent Regional Spatial Strategies).
Government Party speakers over the last year have not been unaware
of the gap which their Planning proposals would produce between
District and nation. Some have therefore referred to these proposals
for sub-regional economic partnerships and implied that these
could be extended to fulfil `a strategic Planning role'. The need
for strategic awareness among District authorities was noted.
It would be a duty for their Local Development Frameworks `to
be genuinely spatial'; unless authorities contributed genuinely
to their cluster they would not get their regeneration money;
there was every need to explore how authorities could engage in
joint working within and between scales; joint plans between authorities
would have to show that they could deal with strategic issues.
26. The proposal here is to recognise that in
terms of planning fixed investment, there is not a large volume
of decisions that cannot be transferred down to sub-regional
level: they largely concern transport systems from Birmingham
northwards as between the Manchester, Liverpool, Sheffield and
Leeds areas and between Newcastle-upon-Tyne and the Tees Valley.
On the other hand, the 368 Planning Authorities cannot be expected
always to work in the interests of all neighbours. This point
is recognised in statements by junior CLG ministers: there should
be a "duty to co-operate" and the possibility of County
Councils (where they exist) acting as the co-ordinators of infrastructure.
27. The power of Regional Spatial Strategies
and previous Structure Plans was that their approved text provided
legally-enforceable certainty for implementation through Planning
Inspector decisions. Thus for example a Plan which calculated
the need for housing and proved suitable sites for it in Borough
A could be implemented to meet the expansion of employment in
the adjoining Borough B which had no housing land. Disputes about
retail centres were decided on an agreed policy calculated across
the whole Plan area.
28. LEPs will need to have the legal right
and duty, in full consultation, to assemble and write the legally-enforceable
Plan for the whole area. This need not involve them in all the
myriad day-to-day decisions of the Local Planning Committees.
29. This leaves the issues of Chairmanship and
memberships of LEPs. There could be the view that Plans can only
be approved by elected Councillors, in which case they could convene
as a separate Planning sub-Committee for this purpose. In total
the situation would not be very different from the regime from
1974 to 2004 when County Planning Committees undertook strategic
work and a few larger decisions while the lower tier of Districts
undertook all the detailed work in the implementation of Plans.
30. In the longer term this arrangement would
resolve the question of the remoteness of recent Regional machinery.
Following the rejection of the North East Assembly through a referendum,
many experts looked to the model of two-tier planning of Greater
London with its overall "London Plan". Along with the
two-tier Planning of the four Scottish City Regions, this would
register a convergence of views at a sensible scale.
CO -ORDINATION
BETWEEN LEPS,
AND THE REGIONAL
LEVEL
31. This section takes up the Committee's concerns
about co-ordination of roles between LEPs and "arrangements
for co-ordinating regional strategy". The underlying point
is that efficiency requires the salvaging of the best of Regional
thinking from ten years' recent work in Economic and Spatial Strategies,
and draft Regional Strategies as well as broader arrangements
across large Sustainable Community Growth Areas such as Milton
Keynes and South Midlands.
32. There are problems in building up a single
and complete system of LEPs. For example, if (as expected by the
Centre for Cities) some City Regions covering only part of a Region
are more effective than others, there could be a `confusing patchwork
quilt' of residual and rural areas, resulting on part from the
arbitrary building blocks of upper-tier Authorities. As stated
by an earlier Select Committee
"It is essential that the Government should
give real assurances to those for whom a city-regional style of
government is inappropriate that the development of policy will
not result in a reduction of support for other areas"
(CLG Committee, Is there a future for Regional
Government?, Session 2006-7, para.179)
33. Excessive competition between pairs of rival
LEPs for economic development is widely foreseen at least by established
interests and in correspondence to sub-regional newspapers in
Yorkshire and the North East. As stated by the Northern Echo
editorial of August 7, "the last thing the North-East
as a whole needs is for in-fighting to break out between close
neighbours". Statistical data over nearly 25 years indicates
relative success for the Manchester and Leeds City Regions over
their neighbours in Liverpool, Pennine Lancashire, Sheffield,
Teesside and Newcastle (Champion & Townsend, 2010)
34. This raises the question of the need for
and working principles of previous economic strategies. One of
their objectives might be to maximise growth by cultivating the
areas seen as most likely to attract new investment. Another might
be to ensure some growth for weaker areas, as seen in traditional
distribution of industry policy, and the BIS list of assisted
area wards for Grant for Business Investment.
35. Policy has varied between the objectives.
However, this government, which is concerned with deprivation
and the reduction of welfare assistance, should, it can be argued,
retain machinery for assisting weaker areas.
36. Such a policy is implied in any case in
the Regional Growth Fund, identifying whole Regions for possible
attention. These points raise the issue of retaining some measure
of co-ordination of strategy at the regional level in addition
to LEPs.
37. It was always an open public question whether
the last government's "sub-national review", after taking
large volumes of evidence, would go for a system of City Regions
or of Regions. In the event, the Regions initially held sway,
but a second tier, of sub-regions entered voluntarily.
38. Before, however, any administration actually
adopts LEPs, it is necessary to review a number of points:
39. Firstly, international evidence for the
importance of stability was emphasised to ministers at seminars,
showing that the places that had sustained growth and development
were the ones that had not changed their system of governance.
40. It is likely that, for individual functions,
the present system of eight units is capable of being cheaper
and easier to staff, either for development or Planning purposes,
than a sub-regional system of about 40-60 LEPs, and more capable
of understanding and communicating with Whitehall. The present
machinery has provided economies of scale within which to look
after specialised issues; it is capable, many note, of dealing
with the European Union and with climate change targets, low carbon
technology and renewable energy as well as intra-regional transport
and other large scale projects, and the co-ordination and implementation
of infrastructure.
41. The Regions, although not dignified with
an assembly or subjective public recognition, could still provide
groupings for the discussion of regional allocation problems,
to overcome the basic problem met by and underlying the sub-national
review, that Local Authorities are not elected to co-operate in
looking after each others' interests
42. A personal view is that the sub-national
review got this debate right in having two levels, in that case
starting with Regions, but going on to emphasise the role of sub-regions
within the overall picture (with a voluntary but incomplete pattern
of Multi-Area Agreements). RDAs may have had deficiencies and
their scale of expenditure in present circumstances may warrant
their closure in southern Regions. Regional Government Offices
(though candidates for slimming down in other regards) are in
a position to draw on everything that has been learnt in the co-ordination
of government department activity across the map, and should continue
with simple regional strategies and with Leaders' Boards, lately
agreed to represent the leaders of democratically elected councils.
Their strategies may not need to be as full as at present. What
must not be allowed to disappear is a floor of basic machinery
for strategic co-ordination.
12 August 2010
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