INTRODUCTION
1. The Welsh Local Government Association (WLGA) represents the 22 local authorities in Wales. The three national park authorities and the three fire and rescue authorities are associate members.
2. It seeks to provide representation to local authorities within an emerging policy framework that satisfies priorities of our members and delivers a broad range of services that add value to Welsh Local Government and the communities they serve.
3.
WLGA
welcomes the opportunity to feed comments in to the Economy,
Infrastructure and Skills Committee’s inquiry into City Deals
and the regional economies of Wales. Comments are offered below on
each of the issues highlighted for the inquiry.
The current position with
regard to the signed Cardiff Capital Region and Swansea Bay City
Deals and the next steps planned to take them forward
4.
For both the Cardiff Capital Region and the Swansea Bay City deals
a plan of action has been agreed that is designed to support
economic development of the respective regions. The Metro
development is central to the plan for the South East region whilst
in the South West there is a strong focus on digital
infrastructure.
5.
Governance arrangements are in place with a Regional Cabinet of the
ten local authority Leaders in the South East. The Cabinet is
developing its links with other sectors to ensure a rounded,
collaborative approach. Likewise, in the South West, a Joint
Committee has been established including the four Leaders along
with a range of advisors from other sectors/partners. In both
cases, constituent local authorities have endorsed a detailed
report setting out the proposals for their respective deals.
6.
The Cardiff Capital Region has an assurance framework that it will
use to ensure that projects supported (by the balance of funding
over and above the Metro costs) meet a range of agreed criteria.
This is to ensure they align with and contribute to regional
development objectives – socially, economically and
environmentally. The Swansea Bay Deal submission included eleven
specified projects that will now be taken forward.
7.
In both cases, the attraction of additional private sector finance
will be critical. The £1.2bn Cardiff Capital region Deal
seeks to lever an additional £4bn of private sector
investment over a 15 to 20-year period. The Swansea Bay Deal
involves a total investment of some £1.3 billion over a
period of 15 years to include £673m from the private sector,
with the intention that the projects undertaken will attract
further private sector investment over the coming years.
The intended
impact of the City Deals and the way in which this will be
governed, funded and monitored.
8.
Both City Deals have been designed to provide a catalytic effect to
economic development opportunities. Development of the Metro will
open opportunities for new housing, business units and commercial
operations at key hubs on the network. All can generate a financial
return and should therefore be capable of attracting private sector
investment and generating jobs. Collectively, they can help to
achieve more balanced development across the region, easing
pressure along the coastal belt and helping to sustain communities
in the northern half of the region, towards the Heads of the
Valleys. The headline figure is for 25,000 new jobs to be
created.
9.
Swansea Bay aims to deliver close to 10,000 jobs developing and
commercialising solutions to some of the most pressing challenges
in the fields of life sciences, energy, smart manufacturing and
digital networks in both urban and rural areas.
10.
In both cases, the funding for the City Deal itself will come from
UK Government alongside financial support from Welsh Government,
and local authority borrowing[1].
Governance and monitoring will revolve around the Regional
Cabinet and the Joint Committee (para. 5 above). They will provide
leadership and oversight. They will receive regular reports from
senior officers in the constituent authorities[2],
ensuring accountability with open, transparent procedures. Each
region will have to produce monitoring reports to satisfy Welsh and
UK governments. Assurance frameworks and implementation plans must
be approved before government funding is released. For each
authority, the work being undertaken will contribute to their local
Well-being plans, produced in accordance with the Well-being of
Future Generations Act. This will provide a further source of
ongoing monitoring and, in terms of accountability, ensure each
authority’s residents can see how the City Deals relate to
other local activity designed to improve their well-being.
The potential
benefits offered by a possible Growth Deal for North Wales
11.
An injection of funding via a growth bid would provide the same
catalytic impact for North Wales. Substantial work has been
undertaken in North Wales by the North Wales Economic Ambition
Board (EAB). This has included work with the Mersey-Dee Alliance
and the Cheshire and Warrington Local Enterprise Partnership which
is now pursuing a Devolution Deal with the UK Government following
two rounds of funding from the DCLG Local Growth Fund. There are
also links with the wider Northern Powerhouse network as North
Wales was invited by the UK Government to submit a bid that
enhanced the region’s links to the Northern Powerhouse and
included devolution of functions from the Welsh Government (as well
as the UK Government) to the region.
12.
A ‘Growth Vision for the Economy of North Wales’ was
produced[3]
in the autumn of 2016 as the basis for negotiations with the UK and
Welsh Government over a growth bid for the region, along with any
other funding and investment opportunities that could be identified
from EU, private sector and Welsh Government sources. North Wales
has subsequently been invited to bring forward priorities from the
strategy into a growth bid for investment and the conferment of
powers to the region by the UK and Welsh Governments.
13. The Growth Vision sets out the strategic ambition for North Wales for infrastructure development, skills and employment and business growth. It aspires to increase the value of the North Wales economy from £12.8 billion to £20 billion by 2035, with the creation of substantial new employment opportunities. The Vision’s proposed interventions are intended to increase GVA per head and improve the region’s relative wage levels.
14.
The vision has been developed collaboratively with partners from
other sectors. Each of the six Local Authorities has now adopted
the Growth Vision and agreed to work together to deliver it.
Discussions are taking place about the establishment of a Joint
Committee to prioritise what goes forward into the bid and to
provide the necessary governance.
15.
The Growth Vision is supported by a prospectus from the Mersey Dee
Alliance, “Unlocking the Potential” which details a
Mersey Dee spatial proposition which details integrated cross
border proposals which will feature in both the North Wales and
Cheshire and Warrington LEP/Liverpool City Region proposals.
16.
Road and rail infrastructure and connectivity, and integrated
transport planning including bus routes, are central to the Growth
Vision. A potential Metro for North East Wales has been developed
by a range of partners to cope with an anticipated increase in
demand on the transport network resulting from future job growth in
the Mersey Dee cross-border area. Energy and advanced
manufacturing[4]
have been identified as significant sectors of the economy to be
supported as part of any bid. The Wylfa Newydd development in
Anglesey is highly relevant in this respect with the potential for
major job creation (and associated transport demands) in North
West Wales.
17. The North Wales Bid will also seek to develop interventions to support the operation of the markets for both housing and the development of employment land by seeking funds to pump prime development which will then subsequently bring in cash which can be re-invested in further development of housing and employment land.
18. There will be proposals to improve skills and support innovation and the development of small and medium sized enterprises. There will be a drive to develop a Team North Wales approach with the pooling of some Local Authority resources in economic development and transport which could be co-located with similar Welsh Government resources. The key outcome of any structural change proposed supported by specialist development funds will be to make economic development and transport and land use planning more sensitive to the needs of the regional economy.
19.
It will also be important to consider the rural areas of North
Wales and ensure that they are not overlooked and can benefit from
the regional plans. Regionally controlled funds to develop
employment land in North West Wales along with maximising local
employment from Wylfa Newydd, the continued development of Holyhead
Port and proposals for the energy sector and the creative sector
(which has a lively and growing hub around Caernarfon and Bangor)
will be crucial to this objective. It is also anticipated that
improvements to transport infrastructure and skills provision will
enable more people from the North West to access the major
employment sites in North East Wales.
The extent to which a similar growth deal could be of benefit to Mid Wales
20.
The Growing Mid Wales Partnership has developed its own
‘Framework for Action’ [5].
It, too, has been progressing cross-border links, working closely
with the Marches LEP.
21.
There would be sound logic in developing a growth deal approach for
Mid Wales in the same way as for the other three regions. There
could then be a consistent approach across Wales in relation to (i)
financial support and (ii) devolution of powers to the regions.
This will be highly significant in relation to discussions over
future regional policy and the reform of local government. WLGA is
keen to pursue the concept of ‘regional deals’ as an
alternative to any legislative requirement to collaborate. This
also links to a commitment in the WLGA’s Manifesto to seek a
(properly resourced) statutory economic development duty for local
government, capable of being discharged at the regional level,
working in conjunction with Welsh Government and other
partners.
The extent to
which the growth and city deals could solve or exacerbate existing
inequalities, both within and between regions.
22.
It is important to remember that the development of City Deal and
growth bids reflects efforts by regions to attract funding streams
to promote economic development as part of wider plans.
There will be many other funding streams involved in the overall
delivery of such plans. ‘Inclusive growth’[6]
is a key concept here and the plans must embrace social and
environmental aspects of regional improvement, with tackling
inequality as one of the central aims. Indeed, there is a
statutory duty under the Well-being of Future Generations Act to
ensure that development moves us towards a more equal Wales.
23.
Projects undertaken via City/Growth deal funds should therefore
take account of inequality issues within
regions. Wherever possible, they should be designed to help address
them (e.g. through community benefit clauses in contracts; by
establishing links – physical, ICT, skills – between
deprived areas and areas of opportunity). However, they should not
be seen as the only solution. There should be other, complementary
activities taking place (funded through alternative
mechanisms).
24.
The same consideration applies in relation to inequality
between
regions. It
is vital that the work of the four regions comes together to form a
coherent whole. Whilst there inevitably will be a degree of
competition between regions for investment, it should also be
possible for the four regions to work together in the national
interest. That means each region understanding the other
regions’ priorities and having a mature dialogue on phasing
of investments.
The degree to
which the growth and city deals co-ordinate with Welsh Government
strategy
25.
The WLGA recently facilitated a meeting between officers leading on
the work in each region and representatives from Welsh Government.
It was agreed that further meetings of this kind are needed and
they should be mirrored at a political level – e.g. via the
Partnership Council or, possibly, the Council for Economic Renewal.
We are keen to facilitate further discussions between the four
regions and between them and Welsh Government via their recently
established Regional Alignment Board, to develop an understanding
of how best to ensure national WG initiatives interact with, and
relate, to regional activities.
26.
It will be crucial for regional plans and Welsh Government national
level strategies to mutually inform each other. In that way
development proposals will be neither ‘top-down’ nor
‘bottom-up’ but will be co-produced and consistent.
Welsh Government is currently working on four high level strategies
(‘Prosperous and Secure’ etc.) and there is a need for
local authorities to be able to comment on drafts of these before
they are formally published. Only though open communication and
engagement will we achieve the level of co-ordination
required.
27.
It will be
important for the regions to understand how Welsh Government
interventions relate and impact on the regional work and vice
versa. We welcome the new approach to Economic Development
signalled recently by the Welsh Government Cabinet Secretary for
the Economy Ken Skates, recognising the need to change WG economic
development structures to work in closer partnership with the
regions. We look forward to working with him and his officials on
progressing this new approach with the regions.
28. We also look forward to working with other Welsh Government Cabinet Secretaries, Ministers and Departments to ensure they adopt a regional perspective to implementing national initiatives. It will also be important for the four regions and Welsh Government to interact closely with UK Government Departments to ensure that Wales maximises opportunities from key UK Government-led funding initiatives, such as those for supporting research and development, innovation and productivity.