Manufacturers don’t believe local authorities are working together enough to promote growth.
More manufacturers disagree than agree with the statement ‘my local authority is effective at pursuing policies to improve the business environment’, according to research with our members.
Regional productivity figures from the Office for National Statistics also show continued economic weakness across the country, with the fall of 0.5% in the first quarter of 2017 confirming a lost decade for productivity growth.
Devolution deals offer a chance for local decision makers to step up and repair some of this picture across England. Deals offer the arsenal for a strategic attack on the place-specific challenges holding back productivity growth, with the funding and voice to do something about it.
Early devolution deals had a focus on what manufacturers thought should be early priorities in that assault – transport and infrastructure investment – with 68% of our members saying they would have access to a wider talent pool if there were better public transport in their area.
But not all areas have deals and manufacturers, most of whom are outside deal areas, will be dismayed at what they see holding back new deals. From local government, this is parochial infighting over who best represents an area. From central government, it’s a preference for new acronyms over implementation and time wasted in closed-door negotiations that result in the same things being devolved everywhere anyway.
This needs to end. The task at hand – sustainable growth across England through devolution – is too important to be a side show.
Our report, Fostering More Industrious Places, sets out what needs to happen to reboot devolution. As part of the forthcoming industrial strategy the government should make it easier for all areas to sign up to a deal by publishing the ‘menu’ of what is on offer.
This should include the core elements of existing deals as standard: more money for transport and infrastructure spending in exchange for better local governance, along with reinstating the abandoned plans for the promised mayoral infrastructure levy.
But we need to be realistic; even with this action there will still be places that struggle to get a deal over the line. There are too many local authorities in England pulling against each other rather than working effectively together. So as an additional step, local enterprise partnerships will be needed to short-circuit these cumbersome local bureaucracies to get a deal done.
Manufacturers already see LEPs as playing the important role of ‘bringing together local authorities and businesses to focus strategically on growth’ (38% agreed with that statement).
Making them the official and trusted deal-making agent will remove the politics and parochialism holding back progress on new deals and start a serious discussion, involving businesses, about how to foster more industrious places through devolution.
Chris Richards, head of business environment policy, EEF