Local authorities have an important role to play in enabling local economic growth. With the retention of business rates, the relationship between the business base and local government will become more closely entwined. Making the case for growth will be crucial if councils, working with Local Enterprise Partnerships, are to fulfil the potential of initiatives such as City Deals, and lay the building blocks for future prosperity.
In this short video discussion, local government lead partner, Andy Ford, discusses the role of local government in stimulating economic growth with Sir Merrick Cockell (LGA), Joanna Killian (Essex County Council) and Nick C Jones (PwC).
Welcome. Over the last few years local authorities have had to respond to very significant financial challenges. However, alongside that important and necessary agenda, councils increasingly are focusing upon what they can do and should be doing to stimulate growth in our local communities and local economies. To help us explore that important agenda we have today three guests. Firstly, Sir Merrick Cockell, Chairman of the Local Government Association, Joanna Killian, Chief Executive of Essex County Council and Nick Jones, Director of the Public Sector Research Centre at PwC.
Sir Merrick if I can start with yourself. The LGA issued an important report in the Summer, Rewiring Public Services. What does that tell us about the role of councils in stimulating local economic growth?
I think one of the things we have learnt in recent years is that central government, and treasury, has a role clearly in leading the economy, in changing policies and implementing economic plans. But actually you are really only going to deliver economic growth by starting at a local level. And that means those areas working far more in partnership, between business and local councils but also with trainers, with further education, with the whole mass of that local community. In our report, Rewiring Public Services, what we have been looking at is where we can go ahead of that really, to change the direction even further. One of the ideas we have talked about is the local treasury, where actually we have far more control at a local level in partnership, with not only the spending of public money but also the raising of taxation. And that means a discussion with local people, local businesses and others about the needs of that community and how we are going to pay for it in future. Right the way through to our idea for a minimal bond market, again we are rejuvenating that sort of historic tradition and looking to do that ourselves. We don’t need permission to do it so we are going to go ahead. It’s going to be sector owned and it would be an alternative to the public works loan board and may be able to unlock some of that pent up demand for investment in infrastructure and other public organisations, public structures, that we need to kick start the next part of economic growth.
So a very exciting agenda there coming from the LGA. In terms of what you have been doing in Essex, Joanna, what actions have the council taken so far and plans to take to stimulate local economic growth?
Growth is an absolute priority for us in Essex. We want people to be able to be active and thriving, and so they need less of our public services. So, for us, we have been supporting our businesses. Some of it absolutely is about funding for infrastructure. For us, businesses are saying that skills is the problem. You know there is just not enough young people coming out of the college with modern skills that modern businesses need to thrive. So our focus is about reconfiguring, with colleges, with businesses, with universities, our skills system so that we can be confident in 5, 10 years’ time that we have got a highly skilled workforce who can have great jobs in Essex.
And Nick, bringing you in on the question of PwC’s recent report ‘Stepping Stones to Growth’. What does that tell us about what local agencies and local businesses need to do to stimulate economic growth?
I think Andy, the research that we have done shows that there is a very complex interaction between business providers of education and training, individuals and government when you are trying to deliver good jobs and great jobs. For the businesses, they really want a demand driven skills system one that provides the hard and soft skills that they need their people to have and sometimes they feel that the system doesn’t provide that. But equally providers need to understand better the demands from the business community and be agile in response. Of course individuals need good information on which to make their informal choices about future career and indeed be inspired by businesses and others who come into their establishment and tell them about the careers they offer. And also, clearly, an important role for government at all levels to help broker, facilitate and make sure that information is available through various bodies such as, in Essex, the employment and skills board.
Yes. We are proposing to set up a skills board which will be business led. We hope its role in the future will be about commissioning collegeshigher education institutes to provide the quality of courses that our young people need. So our ask of government is devolution of skills funding to that board so that they can actually specify how that money should be spent locally to provide skills and to introduce some very simple things. A portal, so businesses, particularly small businesses, can access the support they need in a very complicated environment.
So our job I think, with our skills board, is to simplify, strip out the complexity and make sure we spend money on the right courses for our young people into the future.
That is absolutely right. I mean the days of councils thinking that we could do it all and should do it all are well and truly over. We know that our best role is as an enabler, or as a conductor of an orchestra really, to bring together those other partners who are all working in our localities who are all active members of our localities and to actually help them to change to make the economy effective. That is our proper role and we think actually it’s a very exciting time. There are real opportunities however tough the economic situation may be. This has risen to the top of our priorities in local government and we know there is a real opportunity to help the next stage of our economic development nationally.
So local councils should be picking up those batons now to conduct the orchestras then?
Many are, and we can always learn from the best examplers and Essex is certainly showing the way to many other authorities.
So a very important agenda, a very necessary agenda for local councils but also local partners and local businesses. If you would like a copy of the LGA report - ‘Rewiring Public Services’, please do go to the LGA website. The PwC report called - ‘Stepping Stones to Growth’ can be obtained and downloaded from the PwC website.
Cities have a significant role to play as the engines of sustainable growth. But how can they measure their success? And how can the measures help guide investment decisions and the allocation of scarce resources? Our Good Growth for Cities report, with think tank Demos, presents the findings of our Index on the economic wellbeing of UK urban areas.
, a report from Centre for Cities, PwC and Sunderland City Council, reveals that mid-sized cities have the potential to create more jobs if they can invest in reconfiguring their centres. The report calls on cities and the government to work together to tackle the main barriers that mid-sized cities face in their quest to grow.