Written evidence from the University of
Hertfordshire
EXECUTIVE SUMMARY
The University of Hertfordshire supports the
creation of Local Enterprise Partnerships. The University has
argued that any structures between Local Authorities and national
Government need to be defined by the profile and requirements
of the local areas within it, also that the RDA system was unable
to support success in economic development and wealth creation,
such as in the innovation-intensive East of England. The University
calls for Higher Education Institutions (HEIs) to be actively
involved in LEPs, which must be business-led, inclusive and outcome/impact-focused.
The University does query, however, the co-ordination of innovation
at national-level, highlighting that much innovation, particularly
that with SMEs, is highly localised in nature. Agility and responsiveness
will be key. The University advocates a strong role for the Technology
Strategy Board (TSB) in addressing this need.
ABOUT THE
UNIVERSITY OF
HERTFORDSHIRE
The University of Hertfordshire has longstanding
links with business, industry, public sector and professional
organisations from the local community and beyond. Offering extensive
business services from expertise, training development as well
as facility and funding management, the University has formed
partnerships with organisations such as Hertfordshire County Council,
the NHS, Business Link, Microsoft, Research Councils UK and the
TSB.
The University is recognised as an enterprising and
business-facing university, in which research and knowledge-related
activities are closely aligned to meet the key future demands
of business and society. It is the top university for Knowledge
Transfer Partnerships (KTPs) in the East of England and in the
top ten nationally.
Over 85% of research submitted to the 2008 RAE
was judged to be of international quality, placing the university
58th out of 163 UK Higher Education institutions. The University
focuses on applied and collaborative research in particular, working
with business, the professions and the public sector to solve
problems and improve processes.
Taking on 2,000 international students from
85 countries around the world, as well as having partner institutions
spanning across 5 continents, the University of Hertfordshire
is very much a global university with great potential to grow
in business and innovation in future years.
A third of the University's income comes directly
from its company trading activities and less than a quarter from
the Higher Education Funding Council.
EVIDENCE
1. The driver for developments such as LEPs
has been the decentralisation of decision-making and accountability
to local areas, allowing communities to define services to meet
their particular needs. For economic development, this means LEPs
taking on the form and functions that fit their area and perhaps
looking very different in adjoining Partnerships. Value for money
will only be achievable if such flexibility is given in practice
as well as in theory.
2. The Government proposal is that some economic
development functions might be organised on a national level,
for example innovation. It is important to recognise that innovation
in SMEs, which will be a key driver for the rebalancing of the
economy, is often highly localised, for example through collaboration
with local universities using KTPs and mini-KTPs, Innovation Vouchers
or other forms of incubation and expert support. This kind of
activity can be transformative for the companies involved (for
example: ongoing savings of £350k/annum achieved for Herbert
Retail and an increase in net profits of more than £75k for
Heales Medical). While the localisation of decision-making under
LEPs is to be welcomed, consideration must be given to how to
secure an effective support mechanism for SME innovation.
3. It is not clear that a national structure
would be agile and responsive enough to deliver innovation schemes
such as KTPs. Nor is it clear that Local Authorities are the right
kind of organisations to do so; it is not core business, brings
less local political capital and falls outside the current skills/expertise
base. Even where Local Authorities can set up LEPs quickly, there
will inevitably be a delay in reaching operational effectiveness;
for SMEs and high-tech start-ups, this could prove "fatal"
as well as representing missed opportunity for economic growth.
There is a role here for the Technology Strategy Board (TSB),
with its established sub-national structure, track record in driving
innovation and business-led approach.
4. Giving the TSB sole responsibility for
funding innovation could be highly cost-effective, given that
it combines national perspective and co-ordination with a sub-national
structure and understanding. An alternative would be for the TSB
to co-fund with LEPs once these are operationally effective, although
this may create unhelpful complexity.
5. It is important that LEPs are genuinely
business-led and are outcome- rather than process-oriented. This
will be vital if they are to succeed in this task, and the broader
remit in economic development and enterprise.
6. We agree with the University of Plymouth's
submission that the Regional Growth Fund should be based upon
a contestable model, not based proportionally upon the old boundaries
of the RDAs and how they were historically funded. Funding should
be based on likely impact and accountability on outcomes. This
approach will support and reward new thinking and success rather
than follow a subsidy model.
7. Local Authorities should be encouraged
to involve universities on LEP Boards. Universities, particularly
those like Hertfordshire with a mission to support business success
through innovation, R&D and specialist skills and support.
Depending on their profile and markets, some universities may
have a role in more than one LEP and should be free to engage
in these as appropriate to local needs.
8. There are universities with a strong
track record in local partnership approaches to economic development.
As the UK's leading business-facing university, Hertfordshire
has taken an active role in creating an innovative and entrepreneurial
economy in Hertfordshire. The University helped set up the economic
development partnership Hertfordshire Prosperity (HP) and chaired
it for six years; under the University's stewardship HP proved
highly successful, helping to secure some £54 million of
public funding for major projects in Hertfordshire since 2002,
generating a further £113 million of match funding. The University
is now on the Board of HP's successor, Hertfordshire Works, and
has been influential in particular in terms of strategy development
and innovation policy.
9. There are a number of reasons why the
University of Hertfordshire was able to play such an important
role in Hertfordshire's economic partnership, and why higher education
institutions have a pivotal role to play within LEPs:
— Many universities are major local employers
similar in size to major corporate businesses. For example, the
University of Hertfordshire has an annual turnover of £225
million, employs 2,200 staff and has a student population of 24,000,
coupled with some 120,000 alumni spread across the world.
— The University has very strong business
credentials, both in its own right and through Exemplas Ltd, its
subsidiary company that runs two business link contracts.
— The University has the ability to combine
strong and effective local linkages with the credibility and the
contacts to lobby on major economic development issues.
— The University is perceived to be a trusted
"honest broker" between the very broad range of private
and public sector organisations involved in economic development.
— At a time of unprecedented change, the
University brings consistency and stability.
10. Universities with such a track record
should have a role in sharing best practice with other institutions
in terms of active engagement in local economic development.
RECOMMENDATIONS
11. We support the University of Plymouth's
recommendations as given in their submission:
— That all universities are encouraged
and supported in playing an active role in the development of
LEPs and the innovation infrastructure for their local area.
— That universities are able/encouraged to
span one or more LEPs if appropriate, reflecting their area of
influence and their contribution to economic development nationally
as well as locally.
— That the structure of each LEP is such
that it reflects priorities locally, and that a critical mass
in terms of membership is achieved, whilst maintaining local accountability.
— That central funding should be allocated
based on a contestable model, encouraging development of collaborative,
innovative and high impact projects.
— That the transition framework and timetable
reflects the inevitably variable speed at which different LEPs
will become operational.
12. We also recommend that consideration
be given to how to effectively support innovation in SMEs at local
level, and that the TSB be consulted on this issue.
13 August 2010
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