The Queen’s Speech

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Rachel Anderson, assistant director of policy, comments on the Queen’s speech

The Chamber welcomes the measures set out in the Queen’s Speech today on enabling local growth and furthering the levelling up agenda.  We must not see levelling up measures watered down.

We also welcome the commitment to carry forward the Government’s plans on energy security which should bring significant growth to the North East’s low carbon and green energy sectors.  We would also wish to see a commitment to new nuclear in that bill.

What was more disappointing is that there were no emergency measures to tackle the cost of living crisis and no further commitment to transport development in the North of England.

We await further details on the Government’s plans for deregulation, however any measures must be introduced in full consultation with business

The North East needs it’s fair share of funding

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Marianne O Sullivan, policy adviser, North East England Chamber of Commerce latest column for the Journal

The Government has announced that the UK Shared Prosperity Fund will allocate £2.6 billion to reverse the country’s geographical disparities. The fund is set to replace previous European Development Funding.

It’s essential that the North East receives the same level of funding as under the EU. The region faces high levels of deprivation and therefore needs to see higher levels of support as part of the levelling up agenda. The Government has said it will match EU funding however we will need to see a regional breakdown of the proposed funding to ensure that this is the case.

Currently UK funds are only due to match EU funds in 2024-2025 as the UK will continue to receive its final allocation of EU money until then. We need clarity over the seven year spending plan and how the funds will be allocated based on need.

The Government has said that it will allocate funding based local population data, and a broadly based measure of need, including factors like unemployment and income levels. These aren’t clearly defined metrics, so we need more clarity on the criteria behind the funding to show that it is being allocated fairly.

This funding is especially important to us in the North East as we’ve received above average EU funds due to allocation based on economic need.  In 2014-20 the North West, North East and Yorkshire and Humber received on average 15 per cent per capita more in terms of EU funding than the UK average.

Added to this, the latest labour statistics show that the region has a higher than average unemployment rate at 5.4% compared to a UK average of 3.8%. We also have the second highest levels of child poverty in the country. It’s essential the region is allocated a fair amount of funding to enable local leaders to tackle deprivation as part of the Government’s levelling up agenda, to ensure people can access opportunities in the North East.

The Government has said funding decisions will be made by elected leaders in local government, with input from local members of parliament, local businesses and voluntary groups. We will be working hard to ensure that the priorities of our businesses are heard and the funding will be put to the best use in the North East.

Good Growth for Cities? North East Needs Support

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The new Demos-PwC Good Growth for Cities report looks at how well positioned UK cities are for recovery from the pandemic. This snapshot of the report focuses on the North East’s performance, changing public preferences, and steps businesses can take to drive Good Growth for all.

 

Good Growth for Cities Index

For the last decade, the annual Demos-PwC Good Growth for Cities Index has measured the performance of cities and regions right across the country.

The index does not only look at economic indicators, but other measures of wellbeing too. These are work-life balance, skills (16-24 and 25+), income distribution, health, environment, income, jobs, transport, owner occupation, house to price earnings, new businesses. Two new indicators have also been added to the index, which are vibrancy of local high streets and safety.

The variables fall broadly in line with the Government’s 12 missions outlined in the Levelling Up white paper, but the report notes that it is interesting that the environment was omitted. The writers recommend that local leaders should consider the environment, sustainability and climate change in their levelling up plans.

 

Of the 14 indicators above, the biggest improvement between 2017-19 and 2018-20 is work-life balance. There have also been improvements in the skills of workers above the age of 25, as well as income distribution and life expectancy. The writers feel these improvements are perhaps a reflection of the rise in flexible working patterns.

Most cities continue to see improvements in their Good Growth scores, and it appears that the pandemic has levelled the playing field to some degree between the highest and lowest ranked cities, with the gap narrowing slightly this year.

 

The North East Region

No North East cities achieved an index score above the UK average. The region also has the lowest performing city in this year’s index: Middlesbrough & Stockton. Despite this, the report stated that Middlesbrough & Stockton is also estimated to have the strongest recovery in the region. Its economy is estimated to grow by 7.0% in 2021 and by 4.9% in 2022.

The report stated that the North East and Yorkshire have performed well regarding:

  • House price to earnings (7 of the 10 cities score significantly above the national average
  • Work-life balance (Every city, bar Hull, scores significantly above the national average
  • Income distribution (Where 9 out of 10 cities score at or above average)

The regions performed poorly in other variables, however, including income, jobs, health, new businesses per head, owner-occupation, and safety.

The report states that many of the issues faced by the North have been exacerbated by the pandemic, as many cities, even those in which the economy is in reasonably good shape, have been unable to capitalise on the changing nature of public preferences and may need support in this area. These changing public preferences are outlined in the next section.

Nevertheless, the report outlines ways in which cities and other areas can benefit from the changing nature of the way we live, and one of the examples was located in Northumbria.

The Northumbria Healthcare NHS foundation is considered to have pushed the boundaries of its expected role regarding its response to COVID-19 by setting up a PPE factory. The factory is about to become the country’s leading PPE supplier for NHS Trusts, and also revived the local textile industry.

 

Public Preferences

As in previous years, PwC asked members of the public to provide their views on the measures they think matter most. The report shows that there has been a marked shift in public preferences, with greater weight being placed on issues such as work-life balance, income distribution, and the environment:

  • Safe and secure neighbourhoods that are free of crime (14%) [New]
  • Fair distribution of income and wealth (14%)
  • Adequate income levels (13%)
  • Good health (10%)
  • Time with family / work-life-balance (10%)
  • Protection of the environment (for example, carbon emission reduction, preserving forests) (10%)
  • Good quality transport systems (road and rail in particular) (8%)
  • Secure jobs (8%)
  • Access to shops on a high street (5%) [New]
  • Affordable housing (4%)
  • Having the skills and education needed to be in employment and earn a living (2%)
  • High levels of entrepreneurship and new business start-ups (2%)

Jobs and Skills, which were perceived as two of the most important variables in the index last year, saw significant decreases this year. It is not yet clear whether this is a temporary shift in values due to the way we have been living over the past couple of years, along with relatively strong confidence in the employment market, or if this is a more permanent shift in preferences.

 

Actions for Businesses

Levelling Up and the Reality of Regional Inequality

  • Take a proactive role in developing local economic strategies, in partnership with local and regional leaders, to identify strategic priorities to boost productivity and support innovation.
  • Play a greater role in delivering a fair recovery across the UK, with a particular focus on reskilling and upskilling, to ensure people are equipped with the right tools for future jobs, particularly in green growth industries.
  • Seek collaborative ventures, including partnership and coordination roles, with central and local government, charities and community groups to create business opportunities and improve the effectiveness of levelling up interventions.

Capitalising on Growth Outside Larger Metropolitan Cities

  • Provincial economies typically experience a deprivation of skilled workers as a result of low wages or better opportunities being offered in more urban areas. Businesses can improve this by investing in the development of talent, through retraining and apprenticeship programmes.
  • Businesses should continue to explore ways to increase flexibility for their employees in a hybrid working environment. Greater flexibility and the opportunity to decide when and where to work may encourage more employees to help support rural and provincial economies at the same time as helping larger metropolitan areas recover.
  • In partnership with local leaders, businesses can push forward the circular economy and green growth agenda by exploring opportunities to localise supply chains as much as possible, reducing excessive carbon emissions from production and transportation and capitalising on local assets.

Driving Social Mobility and Addressing Intergenerational Inequality

  • Recognise the cost that the pandemic has had on the upskilling experience for young people, whether that be virtual fatigue and the perception of online training, or that new hybrid ways of working have made it increasingly difficult to learn from colleagues on the job.
  • Begin to reimagine the upskilling journey, but first they may wish to increase their involvement with education and training providers, as well as apprenticeship schemes, to understand where improvements can be made to reinvigorate the learning experience.
  • Look strategically at the skills system, focusing on skills that will enable the capabilities of the future.

Green Growth to Provide a Basis for All Future Action

  • Craft a coherent and actionable strategy to deliver sustainable growth by breaking down ESG considerations into a set of manageable actions and selecting the areas in which they want to compete.
  • Make use of innovation hubs and grants to collaborate across public and private institutions, to embrace innovative ways of working and disruptive technologies.
  • Unlock efficiencies through incentivising better use of resources, including decreasing waste and energy usage.
  • Drive social mobility, as well as racial and gender equality, in green sectors by offering accessible educational pathways, including skills programmes and apprenticeships, and increased support for career progression.

 

Read the full report here and interact with the website here.

 

Photo by Toa Heftiba on Unsplash

Education should be at the forefront of the levelling up agenda

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Freya Thomspon, Knowledge and Research Executive, latest column for the Journal

To say that the pandemic has been disruptive to many people’s lives is an understatement, and mine is no exception.

Once upon a time, in a land pre-covid, I decided to move to Tokyo on a teaching exchange programme. My dreams of travelling, gaining work experience, and figuring out what I wanted to do for the rest of my life were shattered, however, due to multiple last-minute delays caused by travel restrictions.

I lost thousands of pounds on comprehensive health checks, teacher training, and rent on the Tokyo flat I was encouraged to secure ahead of my arrival. In addition, the countless hours I had spent learning Japanese and how to teach English as a foreign language felt wasted. Scared and unsure, after being wrapped up in my moving plans for over a year, I suddenly needed to reinvent myself in the middle of a pandemic.

While my situation might have been on the extreme side, it is an experience that will feel familiar to many of today’s youth. A survey by Prospects found that 29% of final year students lost their jobs and 26% lost internships, while 28%, like me, had their graduate job offer deferred or rescinded. In addition, a YouGov poll of over 1000 HR decision-makers in British businesses found that 61% of employers cancelled some or all of their work experience and internship placements.

Trying to find a new job with a lack of work experience and connections was extremely daunting, especially since the opportunities that remained became super competitive, and virtual interviews were alien. While I was disheartened that, for a time, I couldn’t even bag a volunteer role related to my degree subject area, I couldn’t be happier with the new path I found in working for the Chamber.

Not everyone is so lucky, though. Experts say that those from disadvantaged backgrounds and with fewer qualifications are most at risk of long-term social and economic exclusion, which means the North East is particularly vulnerable.

With so much emphasis on upskilling and reskilling in order to lead economic recovery from the pandemic, it is perhaps more important than ever to put an end to the chronic underfunding of colleges and put further education and other skills training at the forefront of the levelling up agenda, lest we end up with a ‘lost generation’ of young people who are locked out of work opportunities for good.

Levelling Up Health and Wellbeing in the North East

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In the Government’s outline for Levelling Up the United Kingdom, two of the twelve ‘missions’ concern health and wellbeing. In this post I summarise the missions, their policy programmes, and what they could mean for the North East.

 

Health

The Government has stated that the gap in Healthy Life Expectancy (HLE) between local areas where it is highest and lowest will have narrowed by 2030, and that HLE will rise by 5 years in 2035.

The motivation behind this mission is that there are stark disparities in health outcomes across the UK, and that people deserve to have the opportunity to live long, healthy lives wherever they live. Better health will also improve productivity and wellbeing.

People living in the most deprived communities in England have up to 18 years less of their lives in good general health than the least deprived. The North East has the lowest life expectancy in the country and, in its most deprived areas, life expectancy has been decreasing. This is driven by a variety of factors, including smoking rates, alcohol intake, poor diet, quality of housing, and access to healthier food. Access to and quality of health services are also an issue which can vary by area.

Covid-19 has made these disparities even more stark, with hospital admission, mortality rates, and ‘long covid’ higher among more deprived groups. Access to healthcare has also widened in deprived areas, with waiting lists in England having increased by 55% in the most deprived areas. This is compared to only 36% in the most affluent. Ethnic minorities and people with disabilities have also been disproportionately impacted.

The government’s policy programme to improve health focuses on:

  • Improving public health
  • Supporting people to change their food and diet
  • Tackling diagnostic backlogs

 

Improving public health

The key points:

  • Recent launch of the Office for Health Improvement and Disparities
  • A new White Paper on Health Disparities in England will be released this year
  • The 2019 NHS Long Term Plan
  • The Core20PLUS5 Initiative
  • Rollout of social prescribing
  • A new 10-year Drugs Strategy was published late last year
  • A new Tobacco Control Plan for England is due to be published later this year
  • The Government is investing £75m in weight management services and support in England in 2021-22

A closer look:

The new White Paper on Health Disparities in England that will be released later this year will set out a strategy to tackle the core drivers of inequalities in health outcomes. It will have a strong focus on prevention and disparities by ethnicity, socioeconomic background, and geography. It will also include new ways to ensure that business plays a part in improving health.

The 2019 NHS Long Term Plan and the Core20PLUS5 initiative each look to level up healthcare. The latter focuses on improving cardiovascular disease, cancer, respiratory, maternity and mental health outcomes in the poorest 20% of the population, as well as ethnic minorities. In the North East, this will particularly benefit Middlesbrough.

In rolling out social prescribing, the aim is for at least 900,000 people to be referred to social prescribing by 2023-24. Social prescribing promotes a holistic approach to people’s health and wellbeing. NHS England has also commissioned an evaluation of this rollout to ensure that it meets people’s needs. There are several social prescribing projects across the North East region, including Ways to Wellness and Zone West. More specifically, the Government has invested in a £5.77m cross-government project aimed at preventing and tackling mental illness through ‘green’ social prescribing. This will look at how to increase connection to the natural environment and will be focusing particularly on communities most affected by health disparities.

Finally, a new 10-year Drugs Strategy was published late last year and outlines a whole-system approach. The most deprived areas in England face the highest prevalence of drug-driven crime and health harms associated with drug use. The Government has stated that they will invest £780m to create a treatment and recovery system to break the cycle of problem drug use. As of 2020, the North East has had the highest rate of drug misuse of any English region for 8 consecutive years. We also have the highest rate of drug misuse deaths.

 

Food and diet

The key points:

  • Upcoming Food Strategy White Paper
  • New approach will be launched to assure compliance with school food standards (in collaboration with the Department for Education and the Food Standards Agency)
  • Government to invest £5m in ‘school cooking revolution’
  • Government to invest up to £200,000 to pilot new training for school governors and academy trusts on a whole-school approach to food
  • Aim for every child leaving secondary school to know at least six basic recipes
  • 3-year pilot of a Community Eatwell programme (GPs will be able to prescribe fruit and vegetables and food-related education)

A closer look:

The Government states that their upcoming Food Strategy White Paper will attempt to ensure that everyone can access, understand, and enjoy the benefits of a healthy and sustainable diet. This includes looking at how consumers access information about food. It will support eligible children and families in some of the most disadvantaged areas to learn and improve their knowledge of health and nutrition.

While the project launched between the Department for Education and the Food Standards Agency will engage with multiple local authorities, it does not appear that any will be in the North East. The project aims to promote accountability and transparency of school food arrangements by encouraging schools to complete a statement on their school websites. It is the Government’s intention that this will become mandatory when schools can do this effectively.

 

Tackling diagnostic backlogs

The key points:

  • £2.3bn of Government investment to improve access to vital diagnostic services and tackle the diagnostic backlog
  • At least 100 Community Diagnostic Centres to be established in England by 2025
  • The People at the Heart of Care White Paper published late last year outlines planned reforms to adult social care in England

A closer look:

The majority of the Community Diagnostic Centres will be based outside of London and the South East, boosting diagnostic capacity in areas that need it most and offering a range of services tailored to local needs. The centres may include imaging, cardio-respiratory, pathology, endoscopy and general consulting equipment to allow several tests in one visit, improving the accuracy of diagnosis and overall patient experience. It is said that the Community Diagnostic Centres rolled out this year will deliver nearly three million additional scans in the first full year of operations. Over the next three years, they are projected to increase scans by an additional eight million tests each year, providing the equivalent of 23,000 years of improved quality of life.

As part of the Government’s commitment to build 40 new hospitals by 2030, Two hospitals are to be delivered in the North East by the end of the decade. These include the rebuild of Northgate hospital and a new hospital to replace Shotley Bridge Hospital. It is also said that 725 more doctors and 1,552 more nurses will be working in hospitals in the North East between September 2019 and September 2021.

 

Wellbeing

The Government has stated that, by 2030, wellbeing will have improved in every area of the UK, with the gap between top performing and other areas closing.

This ‘mission’ is considered an overarching, outcomes-based measure of success for levelling up. The report states that wellbeing captures the extent to which people across the UK lead happy and fulfilling lives, and consider it the very essence of levelling up.

Wellbeing is affected by a multitude of things, from physical and mental health, jobs, community relationships, quality of housing, and the environment. The report found that even the most productive and prosperous of places have some of the lowest levels of life satisfaction, which persisted even after controlling for personal and economic characteristics. They considered this a powerful illustration that wellbeing goes beyond income and that other factors are just as, if not more, important.

While the North East had the most significant deteriorations in happiness and life satisfaction from April 2019 to March 2020, the most recent investigation on personal wellbeing from the ONS found that the North East was an exception to increases in anxiety and decreases in happiness the feeling that the things done in life are worthwhile.

The Government states that, over time, it will be able to expand its use of new and administrative data through the ONS and the Integrated Data Services Platform, and that this will improve estimates of factors such as wellbeing.

 

Freya Thompson

Knowledge and Research Executive

@NEEChamberFreya

 

Photo by Andrew Tanglao on Unsplash

Levelling Up on crime

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Last week saw the publication of the long-awaited Levelling Up White Paper, which outlined how the Government intends to address issues of inequality and disparity across the country.

A key test for the strategy, and for the Levelling Up project in general, will be how what is outlined translates into tangible outcomes for voters.

Of the 12 missions outlined, some lend themselves more readily to delivering swift change communities will see and feel – not just by the deadline of 2030 set by the paper, but by the next election.

The mission aimed at tackling crime and creating safer neighbourhoods is one of those on which success will be judged.

By 2030, homicide, serious violence and neighbourhood crime will have fallen, focused on the worst-affected areas.

The North East as a whole had 94.5 recorded crimes per 1,000 population in the year ending September 2021, above the English average of 82.0 per 1,000 population.

But within that figure there is significant disparity between the Northumbria and Durham constabulary (with figures of 87.8 and 88.0 respectively) and the Cleveland area (119.1 recorded crimes per 1,000 population).

There’ll be huge variation within those areas too – for example. while Northumbria’s area has the lowest rate of recorded crime in the North East, Newcastle is mentioned in the White Paper as one of 13 areas given funding to tackle drug-related issues as part of Project ADDER. Although not mentioned in the White Paper, Middlesbrough was one of the first wave of locations involved in Project ADDER in January 2021.

The White Paper does note the localised nature of crime, acknowledging a quarter of crime is focused in 5% of local areas, with 5% of offenders accounting for 50% of recorded crime.

The North East also receives an unwanted name check on reoffending rates, which at 30% are the highest in the country.

The White Paper is light on new policy around crime, alongside a mention for ADDER, it points to the existing Safer Streets Fund – where funding is set to be expanded – and to an enhanced role for Community Payback sentencing.

There is mention of bringing forward plans for a National Spring Clean, where Community Payback hours will be used to address issues like litter, graffiti and broken windows.

More broadly, there is lots of mention of collaboration across police forces, local authorities and other community groups. This includes the ability for a limited group of civil society organisations (having consulted with the local authority and with business) to bid into the Safer Streets Fund – but this funding is limited and must be match-funded locally.

There is a small mention of local devolution, and the possibility of elected mayors taking on the responsibilities of the Police and Crime Commissioner role where geographies align, and having a “clear defined role in local resilience”.

Measures to address crime and create safer neighbourhoods aren’t just about those topics, of course – they are also about attractiveness to investment, maximising opportunity for local communities and helping businesses find and access the best pool of talent.

Although the mission is one of the least well defined – it lacks specific numbers, or many new clear policy asks – it is one which the public will certainly use to measure the success of Levelling Up as a concept.

Arlen Pettitt

Knowledge Development Manager

@NEEChamberArlen

Photo by Tingey Injury Law Firm on Unsplash

Levelling Up: Devolution

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As we continue to analyse the Levelling Up White Paper, we come to the section on devolution. For the purposes of this blog, we’ll just concentrate on English devolution.

 

It is clear from the White Paper that the Government see further devolution as the key mechanism for delivering some of the more eye-catching pledges in the white paper, although it doesn’t go into detail about powers.

At this point it is worth looking a little at what we already have in terms of devolution. The process begun under to coalition government has become a bit of a hodge podge across the country. At the top of the tree are the elected Mayors in the large metropolitan cities, for the purposes of this paper Birmingham and Greater Manchester, where powers over transport, health and blue light services sit alongside responsibility for functions like economic development and inward investment. The next rung down and Mayoral Combined Authorities (MCAs) where an elected Mayor has powers for economic development, inward investment, and adult skills provision but not the other services. These are the types of Mayors we have in the North of Tyne area and the Tees Valley. We also have Local Enterprise Partnerships (LEPs) across the whole country including in areas where there are both Mayors and not Mayors which are a partnership between the public and private sectors and look after economic development but LEPs are under review and may be scrapped or changed. With it so far? Keep notes, there’ll be a test.

The Government recognises that on the whole MCAs have been a good thing and want to roll them out wider and are now looking at traditional Counties as potential new Mayoral bodies. In no attempt whatsoever to relieve the confusion for the ordinary voter, the paper also suggests at County level they could be called Governors rather than Mayors – there was a rumour “Sheriff” had been suggested, but this doesn’t seem to have made it into the final paper.  Whatever they are called, the two areas relevant to the Chamber are likely to be County Durham and North Yorkshire. The paper stresses that any move from County Councils to Mayors (Governors, Sheriffs, Head Honchos, Grand High Poobahs?) would be voluntary, however, it is likely that large funding packages would follow any devolution agreement, so there would be a significant financial carrot in going down the devolved route.

 

Which brings us on to funding. Critics of the White Paper have tended to focus on the funding which is not there and whether any money promised is new. That is probably an analysis for another blog. However, what we have got in the White Paper is a first look at any real detail on how the Shared Prosperity Fund (SPF) may be distributed. For those of you who have shied away from the dark arts of funding (and who could blame you), the SPF is the pot of money which will come from central Government to replace the EU funding lost as part of the Brexit process. In initial post referendum pledges on this fund said that it would match EU funds pound for pound. Whilst this paper gives very little detail on actual levels of funding, what it does suggest is that control of those funds will be devolved to MCAs.  This is a huge step forward and something the Chamber has been looking for from Government as it allows the tailoring of funding to local issues and solutions and ends the one size fits all approach.

There is some more disappointing news on funding though. Where funding pots are mentioned, it seems Whitehall is not yet ready to let go as it is clear we will still have the bidding beauty contests where areas of need are pitted against one another in a one size fits all criteria approach.  This is great news for the cottage industry of consultation which has grown up around bidding applications but is perhaps less good news for Local Authorities and the private sector who must spend precious time and resources endlessly pitching for funds. It is inefficient and rarely solves the problems the funding is earmarked for.

In truth, the mechanisms of Local Government are the parts of the white paper least likely to excite the electorate but wiring and the frameworks to deliver change are important and devolution is central to that.

 

Rachel Anderson

Assistant Director of Policy

@NEEChamberRache

 

Photo by Toa Heftiba on Unsplash

Levelling Up Research and Development

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The Government’s Levelling Up White Paper outlines 12 missions, the second of which is targeting R&D.

The mission states:

By 2030, domestic public investment in R&D outside the Greater South East will increase by at least 40%, and over the Spending Review period by at least one third. This additional government funding will seek to leverage at least twice as much private sector investment over the long term to stimulate innovation and productivity growth.

The White Paper outlines the problem this mission is trying to address, pointing to the fact 54% of R&D spending in the UK occurring in London, the South East and the East of England and that this agglomeration of R&D is going in the wrong direction and has increased by a percentage point since 2017.

The North East traditionally lags behind other regions when it comes to R&D tax credit claims – in the pre-pandemic 2018-19 tax year just 2,000 of the 62,000 claims across the UK came from the North East.

The scale of the issue is also clear from this chart, featured early in the White Paper.

The White Paper sets out a number of ways in which the Government intends to address the uneven nature of R&D spending, but they broadly fall into two categories:

  1. A focus on specific high potential sectors or clusters
  2. Redirecting public sector spending and using procurement processes to foster innovation

So, what’s the North East angle on high potential clusters?

The White Paper mentions offshore renewable energy in the North East specifically as one of “many high-potential innovation clusters across all parts of the UK”. It also touches on a broader set of activity tied to Net Zero, in particular the £33m Driving the Electric Revolution programme which has a presence centred on Newcastle and Sunderland.

In its section on ‘Explaining Economic Geographies’ the paper also highlights automotive, advanced manufacturing and life sciences, universities and research centres, low carbon energy and chemical and the Teesside Freeport as opportunities for the region.

On public spending and procurement the paper leans on a number of government departments to do better with how and where they spend money.

BEIS are to make levellign up one of the key objectives of its R&D investment strategy, increasing the proportion of investment outside of the Greater South East to 55% of its total by 2024/25.

The Department for Health and Social Care, Department for Transport, Department for Environment, Food and Rural Affairs, and Ministry of Defence are all similarly expected to spread their investment more evenly across the UK.

There’s also a specific commitment for Innovate UK’s funding to increase by 36% in real terms, and for greater collaboration between national bodies and local leaders.

Overall, all the messages are positive but how these promises translate into reality only time will tell.

The economics of agglomeration mean businesses, skills and investment in the same or related sectors tend to congregate in certain areas, where innovative or profitable work is already going on – challenging that magnetism will be difficult.

Arlen Pettitt

Knowledge Development Manager

@NEEChamberArlen

Photo by Skye Studios on Unsplash

Levelling Up Digital Connectivity in the North East

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In the Government’s outline for Levelling Up the United Kingdom, one of the twelve ‘missions’ concerns digital connectivity. They sate that the UK will have nationwide gigabit-capable broadband and 4G coverage by 2030, as well as 5G coverage for the majority of the population.

This mission is motivated by the fact that the Covid-19 pandemic demonstrated the importance of digital infrastructure, and that digital connectivity has the potential to drive growth and productivity cross the UK, as well as widen job opportunities through remote working. There are significant spatial disparities in the quality of broadband and mobile networks across the UK, with rural areas more likely to experience worse digital connectivity than urban areas.

In this post I summarise the mission’s policy programme and what it could mean for the North East.

 

Gigabit-capable broadband

In 2020, the UK Government published the National Infrastructure Strategy, committing to providing £5bn in public funding to roll out gigabit broadband to at least 85% of the country by 2025, and subsequently to as close to 100% as possible, working with the private sector. Public investment will target premises that are hardest to reach, and which would otherwise not be provided for by the private sector.

Gigabit coverage has already increased massively over the last couple of years. Across the UK, there was an increase from 10% to over 60% in less than two years. This increase does not exclude the North East, with Gigabit broadband coverage increasing massively from 2% in November 2019 to 66% in January 2022. By 2025, it is forecast to reach 70-80%. With the current speed of growth, it may indeed be possible to reach nationwide gigabit-capable broadband by 2030.

The North East was among the first areas to benefit from Project Gigabit last year, prioritising buildings that had the slowest connections in the local authority areas of County Durham, Darlington, Stockton, Hartlepool, Middlesbrough, Redcar and Cleveland, Sunderland, Gateshead, South Tyneside, Tees Valley and parts of Northumberland. The Levelling Up report states that Project Gigabit is still going ahead in Durham, Tyneside, Teeside and Northumberland.

It is also worth mentioning that the Towns Fund, which is investing over £172m across seven towns in the North East, will include a revitalisation of Darlington which will incorporate town centre WiFi.

 

4G and 5G coverage

The Government has also agreed a £1bn deal with mobile operators to deliver the Shared Rural Network programme. This will see operators collectively increase 4G coverage to 95% by 2025.

There is an opportunity to improve the North East’s 4G coverage greatly. 2021 figures show that the North East’s 4G coverage is lower than 70%, which is lower than every other region in England, as well as Scotland. The report’s figures forecast roughly a 15% increase in coverage Post-Shared Rural Network programme. More work will be needed in the region, then, in order to reach nationwide 4G coverage by 2030.

Meanwhile, regarding 5G, the Government aims for the majority of the population to have access to a 5G signal by 2027. They state that 5G “has the potential to radically change the way people live and make businesses more productive and competitive.”

5G is currently live in some regions across the North East, but often with only with one or two providers.

Since 2017, the Government has provided £200m in funding for 5G Testbeds and Trials, supporting over 200 startups and SMEs across a range of sectors in order to better understand how to use the technology to develop new solutions and services.

In 2022, the Government will publish the Wireless Infrastructure Strategy. This will review how far the private sector will go to deliver wireless infrastructure – including 5G – across the country, and determine whether there are any market failures in places that need to be addressed, and how the Government could tackle these.

 

Digital Skills

The report points out that the economic benefits of gigabit-capable broadband will only materialise if businesses and workers have the skills to take advantage of improved infrastructure. So, we must ensure that people have sufficient digital skills to reap the benefits and prosperity arising from the digital economy. 

In 2020, the UK Government introduced a new digital skills entitlement, giving adults with low or no digital skills in England free access to new digital skills qualifications based on employer-supported national standards. They state that they will continue to work with local leaders to develop Local Digital Skills Partnerships. These collaborative partnerships are now operating in seven regions across England, but none are in the North East.

I would argue that the North East is almost certainly deserving of a Local Digital Skill Partnership. In September of last year, IPPR North produced a report on Addressing Digital Exclusion in North East England. You can read my summary of the report here. The report explained that digital exclusion exists on a spectrum, and is not just about a lack of connectivity. It highlighted that a lack of access to devices, lack of skills and confidence, and lack of inclusive digital design is just as important when considering digital exclusion.

Although it cannot be definitively said how many people in the North East are digitally excluded according to this definition, particularly because there is a lack of data available on digital exclusion at local and regional levels, there is evidence that the North East has higher levels of digital exclusion than the rest of England, particularly in rural areas.

The Government states that it will work with devolved administrations to consider how best to share the insights and evaluation of the programme to help build digital skills capability across the UK. Because digital exclusion is deeply intertwined with other inequalities and deprivation, and the North East has some of the most deprived neighbourhoods in the country, we must hope that specific support will be given to these areas to target the specific forms of digital exclusion that they face in order to truly level up the region.

 

Freya Thompson

Knowledge and Research Executive

@NEEChamberFreya

 

Photo by Georgie Cobbs on Unsplash

Levelling Up Town Centres and Culture in the North East

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By 2030, pride in place, such as people’s satisfaction with their town centre and engagement in local culture and community, will have risen in every area of the UK, with the gap between top performing and other areas closing.

 

Whilst not one of the big-ticket infrastructure pledges such as transport this pledge which really focuses on how we feel about the places we live and use in our everyday lives is probably the most crucial to the Government’s plan in that it is the one most voters will judge “levelling up” by as it is the most visible.

This section focuses on three things, so we’ll take them in turn –

 

Regeneration

This is less about the eye-catching projects and more about looking at some of the drivers of regeneration and how powers can be given to local authorities and MCAs to bring about new investment vehicles. The section also focuses heavily on getting the private sector to invest in regeneration rather than it being simply the domain of the public sector, and by extension the Government.

This is most likely a shift in policy because there is less money available but also because public bodies in recent years have been looking to invest in projects to regenerate an area and to make a financial return and this would make it easier to do. We’ve seen such projects in this area such as Stockton Council’s investment in the Hilton Hotel.

Whilst there are no rabbits out of the hat in terms of announced projects, the Government has committed to a brownfield land fund targeted at Mayoral Combined Authorities (more on the changes to local government and devolution in a forthcoming blog). In this region that means £6m for Tees Valley and £8million for North of Tyne.

 

Town Centres

Town Centres and retail have often been the Cinderella of Government Policy with very little attention paid to them outside Local Authorities. The original free markets left to, well, the free market.

This change in direction is the Government’s recognition that Town Centres are the bellwethers of the mood of a town, prosper and things are good, decline and it is very visible – especially to voters.

Town Centres have been struggling for a while with declines and changes to shopping patterns only accelerated by Covid. We have had a lot of initiatives in recent months in terms of the sometimes-controversial Towns Deals a Future High Streets funds. These looked to deal with longstanding problems such as eyesores and fragmented land ownership.

The document does promise further measures later but doesn’t go into detail but does promise more help in terms of expertise from the High Streets Taskforce.

It does feel like this is the one they have to get right and quickly if the public is to see progress on levelling up.

 

Culture, Heritage and Sport

Possibly the most emotive and, arguably one of the central planks of what it really means to level up. This one is about heart, head, and opportunity.

There are measures to expand youth services and programmes such as the National Citizen Service and the Duke of Edinburgh Scheme. It also promises money for youth centres but, there does not seem to be anything for younger children, no resurrection of Sure Start for example.

We don’t have details of the funding packages, presumably there will be the usual competitive bidding processes, which sort of misses the point but there is at least the acknowledgement of the part youth services play in communities.

Community is another area recognised as a policy area which has slipped in recent years. The measures look to make it easier to bring communities together to own and run assets from community centres to sports teams. There is some money allocated but again it is likely to be on a bidding model.

Culture is a wide area where levelling up is about change of mindset rather than simply throwing money at a something. The paper recognises the opportunity to access culture is something missing in so many areas outside London and the major cities. The document looks at investing in cultural assets in towns regions and flagship projects such as Eden North.

Where the paper seeks to change mindsets is not in the regions but in national institutions. The document seeks to change the rules on Arts Council funding with new allocations heavily weighted to projects outside London and the South East.

It also waves a carrot and a substantial stick (in truth it probably needs to be more substantial) at the National Portfolio Organisations (NPOs), such as The British Museum who receive public funding to do far more in the regions.

 

Rachel Anderson

Assistant Director of Policy

@NEEChamberRache

 

Photo by Charlie Green on Unsplash