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Home , Cambridge, Cambridgeshire, Chatteris

Cambridgeshire and Local Industrial Strategy

A Partner in the - Arc

July 2019 XXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXX

2 Contents

Foreword 4

Executive summary 6

Priorities for and Peterborough 13

Oxford-Cambridge Arc: economic context 18

Evidence summary 24

The five foundations of productivity

Ideas 38

People 46

Infrastructure 54

Business environment 60

Places 66

Priorities across the Oxford-Cambridge Arc 74

Implementation and evaluation 82

3 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Foreword

Cambridge is the UK’s driving force for human discovery. From Francis Crick’s role in the Cambridgeshire and Peterborough discovery of the structure of DNA, is comprised of three different Fred Sanger’s work to understand subeconomies – Greater Cambridge, how to sequence it, and ultimately Greater Peterborough and The to the Sanger Institute's role in Fens. Each is unique, facing its own sequencing one third of the human opportunities and challenges. Success genome, as part of the International for business in each will take a different Human Genome Project, Cambridge form, while the overall goal – an has led our understanding of the inclusive, prosperous, and productive nature of humanity itself. Cambridge economy – is the same. To achieve still produces more patents than the this, many different sectors will need nearest four UK cities put together, and to flourish, creating opportunities its University’s academics and alumni for entrepreneurs and employees. have produced more Nobel laureates The success of the Oxford-Cambridge than any other institution globally. It is Arc is also dependent on an economy the combination of Cambridge’s global in Cambridgeshire and Peterborough leadership in academic discovery, which continues to grow, creating and sectors such as life sciences and further demand for employment and digital, together with Peterborough’s housing. Partners across the Arc rich heritage in manufacturing, and are collaborating to ensure the Arc ’ potential for agri-tech, that delivers on its transformative economic provide the building blocks to make potential for the UK as a whole. Cambridgeshire and Peterborough the UK’s fastest growing and most The mandate to deliver all of this is innovative economy outside . set out in the Devolution Deal signed between central government and local Cambridgeshire and Peterborough partners. Through the establishment is an international hub of innovative of a with devolved business. It is leading in research in powers, local partners set out a fields as diverse as artificial intelligence commitment that ‘Cambridgeshire and agri-tech. It generates £23.7bn 1 and Peterborough will enhance its of national output and has seen position as a global leader in knowledge employment levels growing by 3.3 2 and innovation, further developing per cent over the last six years its key sectors including life sciences,

4 information and communication technologies, creative and digital industries, clean tech, high-value engineering and agri-business’3. This Local Industrial Strategy sets out an evidence-based plan to support industry across the area in delivering Rt Hon Greg Clark MP these goals. The foundation for it is Secretary of State for Business, the Cambridgeshire and Peterborough Energy and Industrial Strategy Independent Economic Review – a thorough review of all the available economic evidence for the area chaired by an experienced and expert panel, bringing in new research on business clusters and growth. This review set out a series of key recommendations, many of which are reiterated and James Palmer developed upon in this document. Mayor of Cambridgeshire By creating the conditions for business & Peterborough to thrive, Cambridgeshire and Peterborough can achieve its goals of doubling economic output and building an inclusive economy. This strategy combines bold ambition with clear actions that will directly support firms to grow, become more productive, and increase their international reach. Prof Aamir Khalid Chairman of The Business Board

5 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Executive summary

Cambridgeshire and Peterborough are determined to make their economy work for all of the area’s communities. The full economic potential of ``Working together collaboratively the region can only be realised across all of the foundations by identifying diverse strengths – of productivity to ensure that from Peterborough’s rapid growth, the implementation of the Cambridge’s global research four Local Industrial Strategies strengths, and The Fens’ innovative maximises the economic potential micro and agricultural businesses of the wider Arc region. and working to tie them together. ``Harnessing the collective strength This Local Industrial Strategy sets out of the Arc’s research base – driving how Cambridgeshire and Peterborough greater collaboration on science and will maximise the economy’s research; developing a network of strengths and remove barriers that ‘living labs’ to trial and commercialise remain to ensure the economy is fit new technologies; and growing for tomorrow’s world. It supports the role of the Arc as a global the aims of the National Industrial research and innovation hub. Strategy by boosting productivity in ``Bringing employers and skills Cambridgeshire and Peterborough. providers together to understand the The interventions within are based current and future skills needs, and on a highly credible, independent planning provision to meet them. evidence base, and are specifically and carefully designed to achieve growth. ``Maximising the economic benefits of new transport, energy and digital This strategy is one of a family of four infrastructure within the Arc. linked strategies covering the Oxford- Cambridge Arc (‘the Arc’), with the ``Developing an improved business other strategies covering , support and finance programme for and the South high growth companies, a shared East . It therefore includes approach to commercial premises a summary of the wider economic and an Internationalisation Delivery context and identifies those priorities Plan to encourage greater trade within each Local Industrial Strategy and inward investment in the Arc. which can be developed at scale across the Arc, complementing the specific Cambridgeshire and Peterborough strategic objectives which sit at the heart of this strategy. This includes:

6 ``Taking a Natural Capital Planning In the short-term, the Combined approach to development within Authority will work to raise productivity the Arc, embodying Government’s per to above the UK average 25 Year Environment Plan and by 2024. Through applying a contributing to the Clean Growth natural capital and ecosystem Grand Challenge Mission to halve the services approach local partners energy use of new buildings by 2030. will ensure this is matched by a Together, the strategies reflect the world-class natural environment. close collaboration and partnership As the Cambridgeshire and working between Local Enterprise Peterborough Independent Economic Partnerships (LEPs) across the region. Review (CPIER) established, it is really three sub-economies. The largest Today’s picture and most international is Greater The Cambridgeshire and Peterborough Cambridge, characterised by high economy is thriving, contributing levels of output and skills, a rich mix of £22bn to the UK. The economy biomedical, pharmaceutical, artificial has outperformed the UK in overall intelligence and other technology growth since 2009, and growth companies underpinned by two leading in employment has significantly universities, one of which is amongst outpaced official figures. The area is the greatest in the world. In the north, an internationally recognised centre Greater Peterborough is important both for artificial intelligence, life sciences, as the largest city and, consistently food production and advanced over the last decade, one of the fastest manufacturing. Cambridge is a growing in the country. It is an area global leader in innovation and the with an important manufacturing commercialisation of new ideas. Local history and existing base. It is also partners’ ambition is to continue to home to a growing range of service, build an industrial ecosystem that financial and professional companies is globally known for tackling the which – with a new 38 minute rail biggest challenges facing society, and connection to London – are set to in so doing to nearly double gross expand further through government value added (GVA) over 25 years. and corporate relocations out of the capital. The Fens, a largely rural area, has a diverse range of market towns; much of the best farmland in the UK; and world-class agricultural production.

7 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

It is a rural economy but one which is Ambitions for tomorrow also home to highly successful, niche This Local Industrial Strategy sets out manufacturing and service companies. three priorities for the Cambridgeshire This Local Industrial Strategy will tailor and Peterborough economy: and mix interventions to the needs of each of these specific sub-economies. ``Improve the long-term capacity for growth in Greater Cambridge Major opportunities exist in the by supporting the foundations of area. The opportunity is to grow productivity. This will support the further, to benefit the whole area, expansion of the region’s innovation building on Cambridge’s world-class powerhouse. Crucially, this will also assets. Devolution, and the creation reduce the risk of any stalling in the of a Mayoral Combined Authority long-term high growth rates that has also given Cambridgeshire and have been enjoyed in the city region Peterborough a key advantage for several decades. This will be with more local powers and done by: investing heavily in housing; funding to deliver the ambitions supporting supply chain development; of this Local Industrial Strategy. delivering transformational transport In addition to making the most of and infrastructure; whilst leveraging opportunities, challenges must also the strengths and better connecting be recognised and overcome. The key the Cambridge cluster – all for the challenge relates to the underlying greater benefit of the other two need to broaden the base of economic economies and the UK. There also growth whilst securing the continued needs to be continued efforts to success of Greater Cambridge, raising support the Cambridge innovation productivity across the wider economy. ecosystem and to continue to attract This will ensure that the whole of international firms to the region; Cambridgeshire and Peterborough grows more high-quality jobs, improving business output and providing better opportunities and outcomes for people.

8 ``Increase sustainability and broaden Sector Deal, local partners in the base of local economic growth, Cambridgeshire and Peterborough will by identifying opportunities for high continue to deepen the connectivity growth companies to accelerate between research and industry, with growth where there is greater a specific focus on addressing the absorptive capacity, addressing Ageing Society Grand Challenge. the current bottlenecks to growth This will include the creation of an in Greater Cambridge; and Innovation Launchpad, partnering ``Expand and build upon the clusters with a global player to help start- and networks that have enabled ups and scale-ups get access to Cambridge to become a global customers and markets world- leader in innovative growth. The wide. A Life Sciences Accelerator Local Industrial Strategy sets out Scheme and key infrastructure how business leaders, sectors, and improvements – such as the A505 places will join together to build an and Cambridge South Station – are economy-wide business support eco- particularly crucial for this sector. system. This eco-system will promote ``Agri-tech: Cambridgeshire and business growth; greater productivity; Peterborough’s ambition is to support innovation commercialisation; greater further growth in pioneering research global market access; and more and development (‘R&D’) in plant effective skills development. This will science and precision agriculture, complement the above to deliver a as part of a regional offer. The more inclusive and resilient economy. innovative ecosystem will be further The CPIER has identified the strengthened, and the Combined area’s sectoral strengths and Authority will develop and fund an specialisms, which this Local Innovation Launchpad facility, or Industrial Strategy will seek to facilities, which offer new locations make the most of. These include: to support the development of innovation ecosystems. Agri-tech is ``Life sciences: Greater Cambridge one of the area’s strategic growth is a global centre of life sciences sectors which does not yet have that will increasingly grow across central agglomerations which will be and be connected a key ingredient in its future success. to a wider cluster operating across the Arc. As part of the Life Sciences

9 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

`` Digital and information A specific opportunity lies in scale-up, technologies (including artificial developing facilities closely coupled to intelligence): the opportunity is to local universities where technologies establish Greater Cambridge and can be developed and taken through the Arc as the preferred global the early stages of commercialisation. base for firms from across the This Local Industrial Strategy also world to create and adopt the recognises five supporting sectors, technologies of tomorrow. As part which are also strengths of the of this, the Combined Authority will Cambridgeshire and Peterborough host a global artificial intelligence economy. These are; , conference in Greater Cambridge. health and social care, , This represents a significant the visitor economy and business opportunity to increase the sector’s tourism, and construction. There growth both within the local economy are opportunities in these sectors to and across the Arc and the UK. create business growth. This Local ``Advanced manufacturing and Industrial Strategy also considers materials: Drawing on existing how these could be maximised. skills and capabilities, the Combined Authority can provide impetus to development of advanced manufacturing across the region. Enhancing the foundations of productivity

Ideas The creation of new launchpads will This Local Industrial Strategy will be focused on key sectors such as ensure that the area’s economic base agri-tech, artificial intelligence and grows by harnessing innovation. advanced manufacturing innovation. Actions to support this include: ``Consider options to develop a Mayoral ``The creation of new launchpads will Innovation and Growth Investment be the focal points for innovation Fund. Providing equity and loan cluster development. The creation investment to firms already accessing of at least four new Innovation growth coaching and support to break Launchpads will be the focal points into global markets and transform for innovation cluster development. their productivity through innovation. Focusing on product development to ``Establish the Innovate 2 Grow support key growth sectors – bringing Network, bringing together leading together established firms with entrepreneurs, innovators, mentors training, R&D, and incubation facilities. and coaches with growing firms to  strengthen linkages across the area.

10 People Infrastructure The People chapter sets out how The views of businesses surveyed education and training levels will and engaged in the development of be improved to ensure business place and sector strategies is that has the supply of skills it needs, poor infrastructure is hampering and that people are provided with growth and is set to increase as a more and better opportunities to problem over the next decade. fulfil their potential, including digital Sustaining and de-risking the area’s skills. Key skills initiatives include: full potential for economic growth ``Implement changes to the relies on transforming the transport, devolved Adult Education budget housing and infrastructure capacity in to change how it is invested and Greater Cambridge and improving the the related outcomes for individual transport system for market towns. opportunity and business needs. Improving connectivity is vital if recent ``Look at scope to create a new growth is not to stall and will contribute university in Peterborough, that will to addressing the Future of Mobility attract highly skilled, productive Grand Challenge. Local partners will: individuals to the city, and develop ``progress key infrastructure priorities, the skills of the local population. for example, establishing in-principle ``Create a Skills, Talent and viability of a Cambridgeshire Apprenticeship Hub: connecting Autonomous Metro (CAM), which could employers, providers, and learners. support sustainable growth in and beyond Cambridge City; ``complete the Cambridgeshire and Peterborough Strategic Bus Review, on the basis of which a Bus Task Force is being established to examine opportunities for an improved future service; and ``work with government to develop a shared evidence base for the current and future energy needs of the Arc, including through the identification of opportunities to test new energy policies or approaches within the Arc.

11 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Business Environment Places The Combined Authority’s aim This Local Industrial Strategy aims is to increase the number of to tailor and customise intervention start-ups and scale-ups to drive to meet the distinctive needs of the growth and productivity. The three different areas of the local Combined Authority will: economy – Greater Cambridge, ``create a new Global Growth Service Greater Peterborough and The targeted at the places and firms Fens. This will include supporting that will have the most impact – market towns as key players. operational from 2020 and working Responding to the with 250 firms per year. This Grand Challenges will be delivered through a new This strategy will make a globally Cambridgeshire and Peterborough significant contribution to the societal Growth Company, an arms-length and economic Grand Challenges that and commercially sustainable, not- the government sets out in the National for-profit business to bring together Industrial Strategy, building on the the Growth Hub, Signpost2Grow and sector strengths of Cambridgeshire the new Global Growth Service; and Peterborough, notably: ``introduce a new ‘Trade & Investment ``life science discoveries that Service’ featuring an integrated transform ageing well; and customer-focused approach to co-ordinating the Global Growth ``artificial intelligence and data Grants and Loans with the support technologies transforming offered by the Department for commercial and public life; International Trade and Buyer Credit ``energy and circular economy (financing overseas customers to buy practices that pioneer British goods) and other products clean growth; and from UK Export Finance; and ``advances in sustainable and ``establish a Global Investor Service healthy food production focused on landing new firms into brought about by agri-tech. Peterborough and Greater Cambridge.

12 Priorities for Cambridgeshire and Peterborough

This Local Industrial Strategy sets out an industrial blueprint to deliver Cambridgeshire and Peterborough’s vision of being a leading place in the world to live, learn, work, and do business. The actions in this strategy will To achieve this, current patterns of help deliver the aims of the growth must change. At the moment, national Industrial Strategy in the Greater Cambridge has a global region; the Cambridgeshire and intellectual and market reach, but its Peterborough Devolution Deal; economic and societal impact remains and the recommendations of the local. Businesses in The Fens are strong Cambridgeshire and Peterborough at bringing cutting-edge research to Independent Economic Review (CPIER). market, but tend to do so in relative The Cambridgeshire and Peterborough isolation. Peterborough is one of the Devolution Deal has set out a clear fastest growing cities in the UK, but has ambition to nearly double output in 25 not translated its industrial heritage and years, and independent analysis has recent growth into shared prosperity. shown that this can only be achieved Therefore, economic successes are by strong increases in productivity. highly place-specific. Within a few Whilst overall output growth has miles of Cambridge there are many outperformed the UK, the area – businesses which are not sharing in its taken as a whole - has become less success, let alone those much further productive, relative to the UK, over the away. Too many of the people working last five years. As is the case elsewhere in Cambridge have commutes that in the Arc, output growth has been are difficult, long and growing: not out sustained by additional employment of choice, but necessity due to high rather than rising productivity. In 2012, housing costs. In isolated hamlets and productivity per hour worked was 98.9 in the biggest cities, the challenge of per cent of the UK average. By 2017, ageing means isolation and ill health. that had fallen to 94.9 per cent, the Businesses face increasing risks biggest five-year fall for any Combined from a changing climate and other Authority area4. Cambridgeshire and environmental pressures. The practical Peterborough has therefore set itself role of this Local Industrial Strategy a five-year target to reverse this must be to apply new approaches trend, aiming to catch up with the to solving these problems. Doing so national average for productivity will deliver the growth needed and per hour worked by 2024. ensure this is done in the right way.

13 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Figure 1: the sub-economies and Cambridgeshire and Peterborough

This Local Industrial Strategy is ``Improve the long-term capacity not a dash for growth at any price. for growth in Greater Cambridge. Cambridgeshire and Peterborough Greater Cambridge is a magnet to Combined Authority will work to companies from across the globe ensure growth is sustainable and has and the home of world-leading digital a positive effect on all communities (including artificial intelligence) and the environment, to ensure the and life science clusters. Its labour long-term health of the area – social, supply and research and innovation environmental and economic. The reputation are of the highest order. Combined Authority’s productivity- But there are signs that constraints growth target is supported by three are starting to bite. Modelling shows priorities, driven by the distinctive that housing, energy capacity and features of the local economy: transport issues will significantly

14 reduce the success of Greater to others. The business support Cambridge if not dealt with. Local networks and skills provision across partners will act, with government’s the area will be better connected to support, to reduce the risk of any ensure that all areas benefit from stalling in the long-term high growth the wealth of expertise that exists. rates that Cambridge has enjoyed ``Expand and build on the clusters for several decades. This will be and networks that have enabled achieved by the Combined Authority Cambridge to become a global and local government investing leader. The benefits of the global heavily in housing, transport and success of Greater Cambridge have, infrastructure, whilst supporting for the most part, remained localised. efforts to increase inward investment Whilst there are signs some non- and to develop the infrastructure knowledge intensive businesses are and skills needed to enable firm moving out of Cambridge to the scale-up. Keeping Cambridge wider area, work will take place to strong is crucial to leveraging the ensure all parts of Cambridgeshire strengths of this globally-important and Peterborough can thrive. This and hugely successful cluster for means building on places’ existing the greater benefit of the other two industrial strengths and developing economies and the UK as a whole. a distinctive offer to help the firms ``Increase the sustainability with greatest potential in these and broaden the base of places to achieve their full growth economic growth. Growth has potential. Specifically, local partners not been balanced across the will target improved productivity local area, and growth in high and access to international markets value companies has been very by identifying opportunities unevenly spread. The interaction for high-growth companies to between the three economies of accelerate business growth where Greater Cambridge, The Fens and there is greater capacity. Peterborough is a potential strength. And innovative growth will be Each economy has its own supported by encouraging individual specialisms, allowing the area as a business leaders, sectors, and whole to lead the UK on multiple places to join together to build an fronts. However, disconnects economy-wide business support between the different economies eco-system. This eco-system will present a missed opportunity. By promote business growth, greater enabling them to work together productivity, better commercialised more closely, this Local Industrial innovation, greater global market Strategy will look to widen the access and more effective skills benefits of high growth in some development – in support of a more areas, most notably in Cambridge, inclusive and resilient economy.

15 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

These priorities will be delivered Avoiding long-term risks to the by the actions set out against each productivity and growth of the local of the foundations of productivity and national economy requires a in the subsequent sections. focus on these issues in Greater Realising this ambition will require Cambridge and its business base. a change in how the three sub- This Local Industrial Strategy therefore economies work. Greater Cambridge is underpinned by the fifth Industrial is a hotspot. There are other patches Strategy foundation of productivity: of excellence in Peterborough, in Places. The approach taken recognises Huntingdonshire, and in The Fens – but the needs of the different places, these hotspots are generally isolated. across one of the largest Combined This means some of the conditions Authority areas in the UK. Greater that have made Cambridge so globally Cambridge, Greater Peterborough, successful must be replicated – dense and The Fens each present different business networks, the right balance of opportunities and challenges. This competition and collaboration, access Local Industrial Strategy responds to to finance, and the provision of high- these, tailoring the application and quality business growth, productivity, mix of the interventions to the very innovation and global market access specific needs of each sub-economy. support, as well as partnerships This means higher levels of transport with key anchor institutions. This will and innovation spend in Greater ensure that the emerging technologies Cambridge, with more focus on and industries are being applied business growth eco-system and will make Cambridgeshire and development, skills and education in Peterborough a better place in which The Fens and Greater Peterborough, to live as well as work and do business. including exploring scope to deliver At the same time, the success of a new university and Innovation Greater Cambridge cannot be taken Launchpads in the north and east of the for granted. There are serious risks area, to stimulate the level of growth that without investment in housing, from innovation, leading to higher transport and infrastructure that the productivity and prosperity there. area needs, the global businesses there These could be closely modelled upon may take flight to more attractive global what is working well in Cambridge. centres of innovation-based growth and it will make it harder to achieve the national 2.4 per cent R&D target.

16 17 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Oxford-Cambridge Arc: Economic Context

This Local Industrial Strategy for Cambridgeshire and Peterborough articulates government and local partners’ shared ambitions for the area at a sub-regional level, outlining how specific interventions in the local area will drive future growth in Cambridgeshire and Peterborough and across the Arc more widely. These local ambitions sit alongside a Introduction to the Arc range of work which will be progressed The Arc is a world-leading economic collectively at an Arc level. area, underpinned by a high-quality Each of the Local Industrial Strategies environment, which has the potential to across the Arc should be read as ‘local deliver transformational growth that will chapters’ of the national Industrial create jobs and boost local and regional Strategy5- outlining not only the economies for the benefit of existing ambitions for the local areas, but also and future communities. It contains how their strengths and assets will almost four million residents and over contribute to national objectives. two million jobs, contributing £111bn of The economic opportunity presented Gross Value Added to the UK economy 6 by the Arc is significant. But it will per year and the transformative not happen by itself. It will take economic potential to contribute concerted and coordinated work around £191.5bn by 2050. It is a highly by both government and the local productive and prosperous region with areas to ensure that the Arc remains global strengths in science, technology an economic asset of international and high-value manufacturing. standing over the coming decades. The Arc covers the ceremonial counties This Local Industrial Strategy for of Oxfordshire, Buckinghamshire, Cambridgeshire and Peterborough, , published alongside those for and Cambridgeshire. The economic Buckinghamshire, Oxfordshire landscape is covered by the and the South East Midlands, Oxfordshire, Buckinghamshire and shows how this will be done. South East Midlands Local Enterprise Partnerships and the Cambridgeshire and Peterborough Mayoral Combined Authority’s Business Board.

18 Figure 2: Map of the Oxford-Cambridge Arc

The Arc as a whole is a strongly The Arc is home to world-leading R&D knowledge-intensive economy. and is already renowned as a place It contains ten diverse universities7, of global firsts – pioneering cures for including the Universities of Oxford and disease, forging breakthroughs in Cambridge, two of the world’s greatest engine technology, innovation in future and most internationally-recognisable energy and transport systems, and centres of learning, and a network of developing world-leading strengths cutting-edge science parks, research in technologies that are shaping the institutions, businesses and incubators. twenty-first century. But it has the ambition and ability to go further.

19 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Its continued success will be critical The Arc has significant strengths in if the UK is to meet its target of the space and satellite sector. The 2.4 per cent of GDP being spent on Harwell Science and Innovation R&D by 2027 and its knowledge and Campus in Oxfordshire comprises over innovation assets enable the area to 90 space organisations employing be world-leading in industries that nearly 1,000 people and is the largest have rapidly growing, global markets. space cluster in Europe incorporating the European Space Agency, the The Arc today: Key Space Applications Catapult and the growth sectors National Satellite Testing Facility. Transformational growth of the scale In aerospace, ’s envisaged across the Arc will need to Cranfield University, which is home to build on the breadth of existing assets the Aerospace Integration Research and strengths found across the local Centre and the UK’s Aerospace area. The Arc is home to two globally Technology Institute, is building a Digital renowned life sciences clusters in Oxford Aviation Research and Technology and Cambridge – the most productive Centre that will spearhead the UK’s life sciences clusters in Europe, which research into digital aviation technology. already compete internationally with the global leaders in San Francisco The Arc is a world leader in advanced and Boston, Massachusetts. These manufacturing, with particular clusters feature prominently in the UK’s specialisms in high-performance Life Science Sector Deals, published technology and motorsport in 2017 and 2018. The Cambridge engineering. Silverstone is home to 40 life sciences cluster alone is home advanced manufacturing companies, to over 400 companies, with 15,500 testing facilities for materials and employees and contributing around vehicles and the iconic F1 Circuit. More £2.9bn annually to the UK economy8. widely, there are over 4,000 businesses Oxfordshire is home to a world-leading operating in ‘Motorsport Valley’9, which bioscience cluster, with an estimated extends from Northamptonshire into 180 R&D companies and over 150 Oxfordshire and beyond – a £6bn global companies in associated industries. It cluster of automotive, motorsport and has world-class R&D facilities, with four advanced manufacturing companies. new innovation centres at the Oxford BioEscalator, the Begbroke Accelerator, Harwell Science and Innovation Campus and Culham Science Centre. Buckinghamshire is also home to a growing med-tech sector and the county also houses national facilities such as the spinal centre in Stoke Mandeville.

20 The Future of Mobility features heavily Policy context across the Arc as a whole, specifically Recognising the importance of the area in the research, development and and the opportunity it provides for the commercialisation of connected and UK, the government has already made autonomous vehicles. Key assets significant investment to support local include the RACE Centre at Culham growth and productivity in the Arc Science Centre, which is a UK centre of over recent years. This has included: excellence of robotics and autonomous systems, Millbrook Proving Ground in ``committing over £400m of Local Central Bedfordshire and, at Milton Growth Funding to the LEPs in the Keynes, a hub of the Connected Places Arc from 2015/16 to 2020/21, to Catapult and the UK Autodrive project. fund growth enabling projects; There are several leading creative ``agreeing over £800m of funding and digital clusters within the Arc. In for economic growth, transport and Buckinghamshire, Pinewood Studios skills through the Cambridgeshire and the National Film and Television and Peterborough Devolution Deal; School comprise two globally renowned ``continuing to invest in the four state-of-the-art facilities. , LEPs’ Growth Hubs to provide Peterborough, Cambridge, , business support across the Arc , Oxford, High Wycombe, and investment in the Greater South Bucks and Aylesbury all have South East Energy Hub; highly concentrated creative and digital ``supporting the accelerated clusters with diverse specialisations. development of key sites through Oxfordshire is home to a range of an Enterprise Zone programme, strengths including computer games, including in Science Vale, software development, cybersecurity, Northampton Waterside, Aylesbury high performance computing as well Vale and Weald; and as film and TV including the new £78m studio facilities at Didcot opened by ``investing, through Innovate UK, Rebellion. In Cambridge, the information £670m in 1000 businesses in the Arc technology and digital technology since 2010 to help them develop and cluster is highly concentrated, with a innovate new products and services. strong track record of establishing and growing globally significant companies. This high concentration of modern, creative, industries, have led to Arc businesses featuring heavily in the UK’s Creative Industries Sector Deal.

21 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

It was part of recognising the Importantly, the government’s national importance that in 2016 the response to the NIC recognised government commissioned the National that delivering ambitious growth on Infrastructure Commission (NIC) to this scale had to go hand in hand undertake a study to strengthen with environmental enhancement collective understanding of the area’s to maximise the benefits to local economic growth potential. The NIC people and leave the environment in published its report10 – Partnering a better state for future generations. for Prosperity: A new deal for the Since then, the government and Cambridge–Milton Keynes– Oxford local leaders have been working in Arc – in 2017, concluding that, with partnership across the Arc to match the right interventions, the Arc could the level of ambition for the area. This harbour transformational growth, includes working collaboratively to even against its existing levels of realise the area’s potential through output. It explained that meeting this four inter-related policy pillars: long-term potential would require both significantly more homes to ``Productivity – ensuring businesses be built and significantly improved are supported to maximise the Arc’s east-west transport connectivity. economic prosperity, including the

11 skills needed to enable communities In its response to the NIC report , to benefit from the jobs created; published in 2018, the government designated the Arc as a key economic ``Place-making – creating places priority, outlining a breadth of valued by local communities, through actions to seize the opportunity for the delivery of sufficient, affordable growth identified in the NIC’s report. and high-quality homes, to increase The government also affirmed its affordability and support growth in ambition to deliver more homes in the Arc, as well as wider services the Arc, supported by measures such including health and education; as the £215m Oxfordshire Housing ``Connectivity – delivering the and Growth Deal and the recent infrastructure communities need, confirmation of £445m Housing including transport and digital and Investment Funding for the Arc. connectivity, as well as utilities; The government has committed to deliver transformational infrastructure ``Environment – investing in projects to improve east-west environmental infrastructure connectivity across the Arc, most and ensuring growth leaves notably by completing the £1bn East the environment in a better West Rail scheme and the Expressway. state for future generations. Government is also working with The four Arc Local Industrial partners to identify what utilities, digital Strategies set out a shared response and environmental infrastructure, to the productivity pillar. planning and investment is required.

22 Figure 3: Cambridge and Peterborough in regional context

Other key strategic corridors This area has the potential to generate In addition to the Arc, Cambridgeshire 400,000 new jobs, half of which would 12 and Peterborough is also the be in technological jobs , by 2036. central nexus for many other This Corridor plays a significant role important corridors and national in the growth of the Life Sciences connections, which will play an sector across the wider region. The active role in future growth. Cambridgeshire and Peterborough Business Board continues to invest London-Stansted-Cambridge in connectivity across this crucial Corridor: This corridor, also known corridor, including recent investment as the UK’s Innovation Corridor, into the upgrade of the M11. connects the area to the capital, via the research centres of Cambridge– Eastern and , and the international Agriculture and Tech Corridor: The airport at Stansted. Key assets local area shares many common include GSK, Enterprise business interests and sectors Zone, and the London universities. with , most notably around agri-tech and food sciences, where the University of is a world-leading research centre.

23 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

This Corridor presents opportunities to Links to international ports: The work together, cementing the East of east coast ports, most notably as a global centre of excellence. , connect to the world, Connections to the midlands and and are a key outlet for exports. As the north: Just as important as links local partners look to grow the area’s south to London and east to Norwich, export contribution to GDP, and are links to the midlands and the thrive in the post-EU exit world, these north. These regional powerhouses links to the global marketplace put are leading the UK in many areas of Cambridgeshire and Peterborough innovation and progress – by connecting in a strong position to trade. into them through key transport links like the East Coast Mainline and A1 the local area stands to benefit from, and contribute to, their productivity growth.

Evidence Summary

A detailed understanding of the economy of Cambridgeshire and Peterborough is the keystone of this Local Industrial Strategy. This is found in the Cambridgeshire Base engine - strong and Peterborough Independent business performance Economic Review (CPIER). This was Businesses in the area are performing developed to inform the Combined strongly. Employment growth has Authority of the nature of the economy, been strong, and, as revealed by developing trends, and issues to be independent analysis of all registered addressed. To ensure this was impartial, businesses in the area, significantly an independent commission was outpacing official sample-based set up to chair it, led by economist figures, by as much as one per cent Dame Kate Barker. Others on the per annum. This is true not only of the Commission included business people urban hotspots of Greater Cambridge and academics with specialist expertise and Peterborough, but right across relevant to the work. Much of the detail Cambridgeshire and Peterborough. that sits behind the key economic features identified here can be found This has translated into strong growth in the review (which is also informing in output, as measured by GVA. the delivery of other key local plans Strikingly, the region has bucked the like the Combined Authority’s Local wider regional trend of the east of Transport Plan and the Non-Statutory England, to outperform the UK. Strategic Spatial Framework).

24 Figure 4: Real Gross Value Added (GVA) – index – 2001=100

An inclusive growth challenge Despite business growth having been This can be seen clearly through strong everywhere recently, the the Indexes of Multiple Deprivation benefits have not been felt across the with strong contrasts within and whole region in the same way. The across the county between areas economy of Greater Cambridge has ranked amongst the best (blue) and been performing the most strongly. the worst (red) in the country13. The positive effects of this have been In many ways, the area is a microcosm felt in parts of the Greater Cambridge of the UK as a whole. It has a ecosystem, with market towns such prosperous south, based around as Ely and St Ives benefiting. However, one principal city, which receives further north the effects are not being the majority of foreign investment felt. Wages are notably lower in the and attracts high value companies northern districts of Peterborough and and talent from across the world. Fenland than the southern districts of International evidence increasingly Cambridge and . shows that this concentration of growth There are related challenges of poorer leads to both high living standards health and education outcomes, with and significant inequality. Further healthy life expectancy falling below north, there is much industry and the retirement age in some parts of innovation, but while there are many the north of the Combined Authority. success stories, business investment, skill levels and wages are lower.

25 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Figure 5: Index of multiple deprivation

26 Risks to UK industrial success This leads the CPIER to make its The CPIER also identified a significant seventh key recommendation, that risk to the national economy if ‘[a] package of transport and other transport infrastructure and housing infrastructure projects to alleviate the issues were not tackled in the Greater growing pains of Greater Cambridge Cambridge area. The report also should be considered the single most recognises the ongoing impacts of important infrastructure priority facing climate change, coupled with future the Combined Authority in the short- to growth and a rising population across medium-term’. Energy infrastructure the area will add further stress to the is also at capacity around Cambridge, area’s environmental infrastructure hampering the ability to build new and natural environment. Advanced science facilities. Securing its future land use and transport modelling success will ensure Greater Cambridge from the can remain a global leader in innovation (similar to that carried out for some and the commercialisation of new of London’s bigger transport projects) ideas and an internationally recognised has shown that, on current rates of centre for artificial intelligence, transport infrastructure development life sciences, food production and housing delivery, the growth of the and advanced manufacturing. economy will slow, before eventually going into reverse within 10 to 15 years.

Figure 6: University of Cambridge modelling: employment growth set to stall in the medium-term, and go into reverse in the long-term.

27 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Sectoral strengths and specialisms The detailed evidence base These have been used as a basis created for the CPIER shows that for recruitment of industry leaders Cambridgeshire and Peterborough to the new Business Board, and for have specialisms in high-productivity, each a sector growth strategy will high value added, sectors. be co-produced between businesses The area is strong in sectors which and the Combined Authority. directly contribute towards the These will sit as part of the Local UK’s Grand Challenges and are Industrial Strategy framework important global growth markets. and will make recommendations Based on a combination of existing for the consideration of the public strength and future growth sector and businesses alike. opportunities, four strategic growth The diagram below shows local sectors have been identified: specialisations in terms of employment ``life sciences; and total turnover compared to the UK in a range of business sectors. ``digital and information technologies (including artificial intelligence); ``advanced manufacturing and materials; and ``agri-tech

Figure 7. Location Quotients for employment and turnover in businesses in Cambridgeshire and Peterborough

28 Life sciences As demonstrated through the Life The sector covers a wide variety Sciences Sector Deals, life sciences of interrelated fields, including is one of the UK’s greatest business pharmaceuticals, genomics, and strengths, and the reach of the biodata. Local industry generates biomedical industry in Greater numerous spin-outs with innovative Cambridge, and increasingly products, including Abcam (which , is international. This offers research tools into proteins and cluster is worth around £3bn annually other chemicals), Crescendo Biologics to the UK economy, encompassing (therapeutics in oncology) and Kymab over 430 companies and employing (developing antibody technologies). over 15,000 people. The growth The Science Industry Partnership, of Greater Cambridge is therefore which brings employers together with intrinsically linked to the future government to provide vocational success of this cluster. Government skills needed for the science announced £45m investment for industry, is launching its first local cloud computing software at the programme in Cambridgeshire. European Bioinformatics Institute Apprenticeship standards for the in Cambridge, in the Spring 14 bioinformatics sector and other Statement , in support of this. key sectors are being developed. The Greater Cambridge cluster is the global HQ of AstraZeneca and also has the presence of other global industry leaders such as GlaxoSmithKline and Envigo. World-leading genomics firm Illumina has recently completed a £150m new facility at Granta Park.

Case Study: Cambridge Centre for Ageing and Neuroscience (Cam-CAN)

The Cambridge Centre for Ageing The Cam-CAN project is using and Neuroscience (Cam-CAN) is a epidemiological, behavioural, and large-scale collaborative research neuroimaging data to understand project, launched in October 2010, how individuals can best retain with substantial funding from cognitive abilities into old age. the Biotechnology and Biological Sciences Research Council (BBSRC).

29 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Case Study: Positive Ageing Research Institute ()

The Positive Ageing Research in ageing unites the Institute with Institute (PARI), is a cross-faculty practitioners, local authorities, multidisciplinary institute involving industry, and voluntary organisations. over 130 academics from across Through innovations local partners Anglia Ruskin University. aim to bring greater sustainability The institute brings together a to technology-enabled health multi-disciplinary team representing services, in order to create business diverse disciplines. Common interests opportunities and economic growth.

Life science opportunities Agri-tech Greater Cambridge is a global centre The Cambridgeshire and Peterborough of life sciences that will increasingly area (and the wider ) is grow across Huntingdonshire and be one of the most fertile soils regions in connected to a wider cluster operating the UK and is home to many progressive across the Arc. Local partners in and innovative farmers, ground-breaking Cambridgeshire and Peterborough will technologists and innovative companies continue to deepen the connectivity across the food and drink value chain as between research, industry, and the well as centres of world-leading research. public sector (especially the hospitals), The management of and confidence in with a specific focus on addressing the key data, including the associated analysis Ageing Society Grand Challenge. This and interpretation for aiding reliable will include the creation of an Innovation decision making will become ever more Launchpad, based on pioneering important. There are untapped potential business scale-up approaches already opportunities in The Fens and across the proven in California, partnering with local area for growing and strengthening a global player to help start-ups and this sector specialism, and by creating scale-ups get access to customers better connections with local clusters in and markets world-wide. It will pioneer clean growth, advanced manufacturing, new approaches in digital health, artificial intelligence and machine learning using the local area as a testbed for – collectively tackling other key policy innovation. A Life Sciences Accelerator agendas in the UK and on a global stage Scheme and key infrastructure such as healthy ageing, nutrition and improvements – such as the A505 well-being. A big opportunity within this and Cambridge South Station – are is to develop new career opportunities as particularly crucial for this sector. part of the devolved local skills system.

30 Agri-tech in this region is increasingly Automation provides opportunities operating as a successful innovation eco- for economies of scale to increase system. An example of this is Agri-Tech the efficiency with which food and East, which brings closer collaboration drink is produced, and new career between the scientific and research opportunities are developing in community and the businesses (including engineering; robotics; software farmers and growers), operating across development and producing algorithms. the supply chain. The Cambridgeshire and Peterborough Combined Authority Agri-tech opportunities has also recently established a venture The ambition is to support further capital fund Cambridge Agri-tech to growth in pioneering R&D in plant support businesses to grow. There is now science and precision agriculture, a need to build on existing partnerships including crop bioscience, engineering, with other geographical areas. robotics and information technology- based systems. This will be achieved as 38,000 people are currently employed part of a regional offer, including New in the agri-tech sector in the local Anglia (through an expansion of the economy, generating approximately joint Eastern Agri-tech Growth Initiative), £4bn of economic value per annum. the Oxford-Cambridge Arc, Greater Agri-tech opportunities were highlighted LEP and other partners. by the CPIER and the sector is forecast to grow by over 10 per cent over the next Innovative ecosystem will be further ten years. The local agri-tech cluster strengthened, including by working with has internationally significant research networks like Agri-Tech East, developing and development in both agriculture new skills provision and building upon and food. This research base is also a the emerging local presence of venture significant provider of postgraduate capital and investment funds. training with a global reputation and The Combined Authority will develop creates a significant market for those and fund an The area’s innovation with higher level skills and qualifications. Launchpad facility, or facilities, which The strength and breadth of the offer new locations for businesses, research base is built on a highly skilled, research institutes, incubators and other international workforce, attracted to key players to co-locate to support the Cambridgeshire by the reputation of development of innovation ecosystems. centres such as NIAB and the University Agri-tech is one of the area’s strategic of Cambridge. Firms in the economy growth sectors which does not yet have have expertise in sensors, robotics, central agglomerations which will be a genomics and communications and are key ingredient in its future success. at the forefront of ideas and commercial applications that are shaping the food production in the UK and globally.

31 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Case Study: NIAB Innovation Hub @

The Innovation Hub is a purpose- ``waste management — packing, built facility in the heart of The processing and alternative Fens, facilitated by funding from uses and markets; the Eastern Agri-tech Growth ``increase value or application Initiative (Local Growth Fund). This potential for new products unique centre managed by NIAB from waste streams; has a particular focus on fresh produce. Welcoming farmers and ``identifying opportunities to growers, food businesses, and other recycle waste or generate users wishing to engage in applied energy and co-products; research work to reduce or re- ``target total and marketable field use all forms of waste in the food losses, due to weather, pests and supply chain and improve resource diseases or other damage; and use efficiency in its production. Research and trial activity includes: ``reduce loss of quality or specification in store due ``waste reduction — healthy to crop physiology, disease soils, crop production, field or storage conditions. and post-harvest storage;

Digital, information technologies and artificial intelligence The vibrancy and technological A well-known example, ARM, was expertise of the Cambridgeshire and started in Cambridge with fewer than Peterborough area digital sector is twenty employees and has grown into a significant reason for the area’s a global player valued at £24bn in international attractiveness. The 2016. This is one reason why Greater sector delivers almost nine per cent Cambridge is an internationally of the area’s revenue and eight per recognised centre for artificial cent of employment. Furthermore, intelligence and digital technology it is the fastest growing knowledge innovation, with Cambridge University intensive sector, increasing 10.4 among the top five globally in this area. per cent over the last three years Academic and home-grown success (compared to 6.6 per cent for KI as has led to major private investment a whole). Foreign direct investment too. established their (FDI) into the area and sector is strong first non-US research centre in and, when these projects occur, they Cambridge in 1997, followed by Apple, generate twice the proportion of Amazon, Samsung and others. jobs than information technologies FDI more generally across the UK.

32 As demonstrated in the artificial Digital and information intelligence sector deal, Cambridge is technologies opportunities a key part of the £1bn invested in UK The opportunity is to establish artificial intelligence start-ups. Venture Greater Cambridge and the Arc as funding of £170m was invested in the preferred global base for firms Darktrace, £140m in BenevolentAI, from across the world to create and and £50m in Featurespace, and the adopt the technologies of tomorrow, number of spinouts from the University offering businesses exceptional talent continues to rise with starts ups such as at all levels and a highly networked PROWLER.io, Cytora, AudioTelligence ecosystem that has global impact. As and Intelligens, and many other part of this, the Combined Authority companies choosing Cambridge for will host a global artificial intelligence their international headquarters. conference in Greater Cambridge. This Cambridge has recently secured a represents a significant opportunity major expansion by -based to increase the sector’s growth both Graphcore, which designs chips used within the local economy and across for artificial intelligence. More widely, the Arc and the UK. It will not be firms are supported in innovative just the digital sector that benefits growth by numerous technological from this growth, but all vertical assets, key amongst which is the new markets who can increase efficiency artificial intelligence supercomputer and deliver advanced benefits to which is being used to support customers through the adoption of artificial intelligence companies in cutting-edge technology products developing next generation solutions. and services such as big data, artificial The inter-relationship between intelligence, robotics and next- digital and the other Local Industrial generation connectivity solutions. Strategy strategic growth sectors Advanced manufacturing can be neatly demonstrated by the 2018 decision of one of Europe’s and materials biggest artificial intelligence firms Specialisms and strengths in this – BenevolentAI – to acquire a drug sector exist across all of the three discovery and development facility at economies of Cambridgeshire and the Research Campus in Peterborough, with an overall strength Greater Cambridge, to dramatically of this region being the practical speed up drug discovery. application of innovation in cutting-edge commercial products. Peterborough has a strong manufacturing history, large firms such as Caterpillar have engineering bases there as well as a number of cutting-edge smaller firms, such as Radical Sports Cars.

33 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Twenty per cent of business turnover Advanced manufacturing generated in Peterborough comes opportunities from high-tech manufacturing (with Advanced manufacturing and materials a further six per cent stemming is a broad sector that contains many from other manufacturing). subsets and will play a myriad of Prototype fabrications for the first roles across the future growth of the magnetic resonance imaging (MRI) Cambridgeshire and Peterborough machines were built at in The economy. The East of England Science Fens, and Stainless Metalcraft continues and Innovation Audit of 2017 found to produce high-end scientific products, this sector to be ‘of foundational such as cryostats, that importance to the other themes’ can maintain very low temperatures. (namely life sciences, agri-tech and Composites are a particular strength information technologies). But alongside in the west of the area, with Forward its ‘foundational’ importance, it has Composites, Paxford Composites and institutions and features which bond Codem Composites based in and around it together as a sector in its own right, Huntingdon, producing alternatives and which this Local Industrial Strategy to steel and aluminium for aerospace, will support specifically to grow. motorsport and other industries. This opportunity covers the whole of Greater Cambridge is home to leading Cambridgeshire and Peterborough, firms such as Marshalls Aerospace where the existing base engine of and Hexcel Composites, as well as firms can be supported to grow into major industry research institutions bigger clusters and eco-systems with such as TWI (The Welding Institute), interventions such as a new Innovation the Cambridge Graphene Centre, Launchpad, the Growth Service, the and the Institute for Manufacturing scoping work for a proposed new operating across the whole country university in Peterborough, and the as well as with firms locally. Greater development of a Fens Business Cambridge also acts as a successful Network. Drawing on skills and spin out engine to the rest of the UK, capabilities that already exist in some with innovations such as metalysis hotspots, the Combined Authority created there and scaled elsewhere. can provide impetus to development Hubs of manufacturing also exist of advanced manufacturing across within Cambridgeshire’s Market the region. A specific opportunity Towns, such as . The St Neots lies in scale-up, developing facilities Masterplan for Growth identifies closely coupled to local universities how the manufacturing base – which where technologies can be includes firms such as Sealed Air – can developed and taken through the act as a contributor to the growth of early stages of commercialisation. the sector within the Arc, making use of new connectivity brought about by East-West Rail and the A428 Upgrade.

34 There is scope to pilot this idea on the motorway connections and access to site, in collaboration the local labour force. Local partners with the Institute for Manufacturing will consider options to provide more and the wider Engineering Department. and better logistics commercial There is also an opportunity to space on the A1 West (Haddon) at collaborate with other centres of Peterborough, where additional, excellence in advanced materials – such contiguous housing is being developed as Greater and CPI in Tees around the Ortons, as this could Valley – to grow the UK’s strengths in provide a significant opportunity for this technology. As part of the Growth improving the city’s GVA performance Service the Combined Authority will ``Health and social care: With almost seek to create Scale-Up Engines to 30,000 staff working in health support early stage commercialisation. and social care in Cambridgeshire Key supporting sectors and Peterborough, the sector is a significant part of the economy, Five supporting sectors have been with long-term potential for growth identified where local strengths and productivity gains through the exist and where local partners adoption of new technologies and can build upon the strong market techniques. Working with existing position to create business growth organisations, such as Cambridge and increase the sustainability University Health Partners, we can of the local economy further: develop closer local links between ``Logistics: The connectedness R&D and early stage product and of parts of Cambridgeshire and therapy development in life sciences Peterborough to the UK transport and the local health and care network means it plays a significant system, opportunities exist to drive part in the UK logistics sector. In commercial and health benefits locally particular, Peterborough has a base as well as globally. The impact of the on the A1, which has attracted many local health and social care sector on firms to establish distribution centres the wider inclusion and growth goals there, including Amazon. Due to the is also crucial. It benefits everyone expansion of online shopping, this to keep staff well, and there is good industry is likely to both grow and evidence that there are opportunities change in future as new methods of for better using employee assistance transport and distribution become schemes and occupational health available. However, to ensure the schemes to keep people in work and city continues to be attractive and reduce pressure on the care system; to capture the growth in this sector suitable sites need to be allocated and developed offering both good

35 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

``Education: Education is a key UK growth and productivity of other export. Recent Department for sectors in the economy, especially Education statistics15 found the in knowledge intensive industries. value of UK education-related In Greater Cambridge a lack of exports to be £18.8bn in 2014. This large conference facilities hampers figure grew by 18 per cent between potential growth here, as international 2010 and 2015. The University of enquires are turned away due to Cambridge’s reputation attracts the lack of sufficient capacity; and many students from abroad – when ``Construction: Much of the these spend money in the UK, it development in Cambridgeshire registers as an export contribution and Peterborough is fuelling strong to the national economy. The growth in the construction sector. This region is home to other key higher gives an important opportunity to and institutions drive productivity and growth across including Anglia Ruskin University, the sector, adopting new techniques and the . and technologies. The local area Due to the prestige of Cambridge, has numerous examples of good there are numerous language building quality, such as the University schools, and colleges offering of Cambridge’s development at preparatory courses, which attract Eddington, which reuses surface students from around the world; level water, reducing wastage and ``Visitor economy and business minimising flood risk. Government tourism: The area is home to has also invested in the Centre for key visitor attractions such as Ely Digital Built Britain at Cambridge Cathedral and the city of Cambridge University, a core partner in the which make a significant contribution Construction Innovation Hub designed to the local economy and natural to support the transformation of assets including and the the construction sector, and the Project are increasingly Construction Industry Training Board important to the visitor offer. However, (CITB) is relocating to Peterborough. Cambridge struggles with the weight The subsequent sections of this of tourist attraction at times, and strategy set out the actions that will be like many world cities, ‘over-tourism’ taken against each of the foundations is a risk. Many of the market towns of productivity to support further and villages surrounding Cambridge business growth and productivity have rich visitor opportunities, which gains, building on local existing if developed into a more coordinated strengths and emerging trends. These offer can bring in revenue and create actions will support all sectors. real economic opportunities. Business tourism is very important as well and has an important impact on the

36 37 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

38 Ideas

Deliver an economy-wide, place-based innovation and growth eco-system. Cambridgeshire and Peterborough is some of this area’s greatest assets, a global centre of highly diverse and through enabling the future success of successful innovation, representing the local centres of innovation – most one of the UK’s greatest assets for idea notably Greater Cambridge – whilst also generation and commercialisation. R&D actively working to spread innovation funding by UK Research and Innovation across more of the economy, moving (UKRI) in the UK is the highest outside firms and sectors up the value-chain. of London within Cambridgeshire and 16 To achieve this, the evidence and Peterborough . Its future success is key recommendations from the CPIER to the UK achieving the commitment and the 2017 East of England Science set out in the Industrial Strategy of 2.4 and Innovation Audit have been per cent of GDP invested in R&D by considered and interventions have 2027, and 3 per cent in the longer term. been tailored in ways that will support The priorities and interventions of this clusters of innovation to grow and that Local Industrial Strategy are collectively are bespoke to places and sectors. intended to maximise the potential of

Figure 8 The Innovation Ecosystem model as developed through the CPIER

39 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Evidence and barriers Combined with the area’s private Productivity growth is heavily R&D labs and public sector research dependent on the introduction of establishments such as the Medical innovative new products and services Research Council Laboratory of and the ideas and the circumstances Molecular Biology, this provides the which give rise to them. Whilst region with a formidable research base. much process innovation happens Knowledge institutions can be found in situ in offices and laboratories in in other clusters in various stages of companies wherever they are, the maturity, such as the recent Agri-tech nature of innovation is changing more Innovation Hub, sponsored by the generally in a way that is becoming National Institute of Agricultural Botany more context sensitive. If the major (NIAB), which was brought forward innovations of the motor age happened with Local Enterprise Partnership in a handful of places and a small investment. The Combined Authority number of large companies, the model proposals to make the case for creating of today is more complex, diverse a new university in Peterborough which and more broadly based. So, place could, over time, become the knowledge matters intrinsically for innovation. engine in the north of the region. Greater Cambridge is one of the world’s This model of innovation sees the most effective and diverse innovation knowledge engine as the foundation systems. Innovation ecosystems for three pillars of policy, namely need knowledge engines that drive finance and intellectual property, development. These include research physical space and capability institutions like universities at the development programmes. high end, and education providers at The picture on availability of, and access an earlier point in the system. It also to, finance and intellectual property is includes the businesses, professional mixed. Cambridge has a deep pool of service advisors, and supply chains early stage finance through the likes which generate clusters of specialisms of Cambridge Angels and Cambridge that draw in interest and expertise. Capital Group, but even here firms Across Cambridgeshire and report low levels of access to scale up Peterborough this knowledge engine capital and growth strategy support. operates to the highest of levels within Greater Cambridge. The University of Cambridge provides one of the best research institutions in the world, and a pivotal anchor for innovation in the city and beyond.

40 The University is seeking to address this In terms of capability development, market failure by supporting Cambridge both the finance and property offers in Innovation Capital and private sector Greater Cambridge are more developed investors – such as Amadeus and than those elsewhere. In Peterborough Ahren – are important players, but there is need which could be met linked elsewhere there is a lack both of to the proposed new university and seed finance and an absence of the growth support proposed through collaborative approach to innovation the Mayor’s Endowment for Global which seems to be so important Growth (EGG). The Fens are similarly a part of Cambridge’s success. in need – focused on sectors including The requirements for physical space, agri-tech and advanced manufacturing. like finance, have stages. What a One key reason for the differential business needs in its start-up phase development of the areas which reflects is different to its needs as it matures the strength of the innovation and and grows. It is vital, if an innovation growth eco-systems in each area is ecosystem is to be effective for there the strength of networks and linkages to be variety and availability at every in each area. Cambridge has highly stage.There is evidence that Greater effective networks: the links between Cambridge could benefit from more incubators, venture capital, mentors start up and particularly scale up space, and entrepreneurs are essential to which are less likely to attract private the ‘Cambridge Phenomenon’. In sector funding given the risk profile and Peterborough there is greater a need need for more commercially focussed to establish the sort of functional wet labs for product development and mentoring, advisory, coaching and testing. The Combined Authority and supply chain networks that have made Greater Cambridge Partnership are Cambridge so successful. The Fens working to support this. Peterborough needs to encourage firms who compete has a significant shortage of business to collaborate and build knowledge. space and especially incubator space, important to encourage entrepreneurs to set up and locate. The Fens lack suitable move-on space and also the tailored innovative spaces that can link to specific sectors and can support wider start up and innovation activity in market towns.

41 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Interventions

Ambition in places where access to finance To deliver an economy wide place-based is more difficult. This will provide innovation and growth eco-system equity and loan investment to firms already accessing growth To drive progress towards coaching and support to break into achieving this priority, global markets and transform their Cambridgeshire and productivity through innovation; Peterborough will: --expansion of the Eastern Agri- ``Improve networking and linkages: tech Research, Development --establish the Innovate 2 Grow and Prototyping Growth Network, bringing together leading Initiative, enabling direct funding entrepreneurs, innovators, mentors support to more firms; and and coaches with growing firms to --establishing an SME Innovate 2 Grow strengthen linkages across the area; Fund to promote R&D, innovation and --establish new networks and commercialisation of ideas – offering strengthen existing networks match funding to SMEs to write bids in specific towns and cities; to access R&D and innovation grants. --support businesses, universities ``Improve the amount of physical and other partners to collaborate space for businesses to set to maximise public and private up and grow, including: investment, including R&D funding in --continue to work to develop at least the four major growth opportunities four new Innovation Launchpads. identified above and to support the These will be the focal point for supply chain innovation which will be innovation cluster development. needed across many sectors; and Focussing on product development --establishing a Fens Business Network. to support key growth sectors – bringing together established firms ``Improve funding for Intellectual with training, R&D, and incubation Property exploitation: facilities. These will be focused --Consider options to develop a on key sectors such as agri-tech, Mayoral Innovation and Growth artificial intelligence and advanced Investment Fund, targeted at growth manufacturing innovation; and firms to fill gaps in the equity and --supporting new start up, incubation, loan market to break into new and scale-up space where markets and support innovation market failures are identified. and productivity gains. Particularly

42 ``Introduce new programmes Arc partners will also use assets of support for businesses such as Harwell, Silverstone and --developing a CPCA-wide innovation Cranfield to establish new networks and growth support eco-system, that support the convergence of harnessing the growth, innovation technologies across sectors and and productivity expertise seek to develop emerging districts within the Knowledge Engine such as West Cambridge. of Cambridge to create 1,000 ``Seek to grow its role as a global Global Growth Champions; research and innovation hub, acting as --establishing Micro Innovation a UK magnet for international talent, Systems in market towns, in specific R&D, Foreign Direct Investment and locations to be identified by the research collaborations. The LEPs and Market Town Strategies, that MCA will work with the Department for integrate the improved business International Trade, the Arc Universities networking infrastructure local Group and others to channel foreign partners propose to create, with the investment in the assets and projects Global Growth Champion support that will make the biggest impact services, the proposed growth on Arc-wide and UK growth. investment funding into specific new Government is working in market town business growth space. partnership with Cambridgeshire Working with local partners and Peterborough to support across the Arc Cambridgeshire the delivery of this priority by: and Peterborough will also: ``Agreeing a Devolution Deal with local ``Harness the collective strength partners that provides new powers of the Arc’s research base will be over transport, planning and skills, essential. The new Arc Universities £600m investment fund over 30 Group will act as the focal point years to grow the local economy and a from cross-Arc collaboration on further £170m to deliver new homes. science and research, identifying ``Investing £146.7m Local Growth and delivering joint R&D projects Fund to the area which has and providing a pipeline of talent to delivered, for example: knowledge-intensive businesses. --£1m investment to support a ``Strengthen its ability for businesses to new innovation campus at the commercialise ideas coming out of its Cambridge Biomedical Campus; and universities and others. Key to this will --£500k investment into the MedTech be a network of ‘Living Laboratories’ Accelerator, set up to facilitate that both trial technologies linked to the early stage development new developments across the Arc and of innovations in the broad help address the Grand Challenges. area of medical technology.

43 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

``Investing £153m to support research --build on the Arc’s existing role and innovation in Cambridgeshire as a testbed for new transport and Peterborough through Innovate technologies, such as automated UK’s competitive bidding rounds. vehicles and drones, working with ``Defra and Cambridgeshire and government and Zenzic to access Peterborough will take forward existing research and development a new partnership, with Defra support, and identify further providing advice on best practice opportunities to trial new mobility in and Cambridgeshire and services within the Arc; and Peterborough exploring opportunities --support local authorities within the to stimulate a step change inrural Arc to implement the Principles of innovation more broadly. the Future of Mobility Urban Strategy, ``Supporting research and development providing guidance on design and of new transport systems and planning to ensure new communities technologies across the Arc through are designed and built to enable investment by the Centre for new approaches to mobility. Connected and Autonomous Vehicles, the Office for Low Emission Vehicles (OLEV), UKRI, Zenzic (formerly known as Meridian Mobility) and Innovate UK. ``Working with the LEPs within the Arc and other local partners, including England’s Economic Heartland, to: --support the delivery of the Future of Mobility Grand Challenge mission and Road to Zero Strategy: utilising the considerable R&D assets within the Arc to put the UK at the forefront of the design and manufacturing of zero emission vehicles, supporting government’s commitment to end the sale of new conventional petrol and diesel cars and vans by 2040;

44 45 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy People

Improve and grow the local skills base to support a successful, globally competitive economy and labour market grounded in high-skilled and better-paid jobs, increased productivity, and growing strong, sustainable communities. The Cambridgeshire and Peterborough Evidence and barriers Combined Authority has developed a The Cambridgeshire and Peterborough Skills Strategy Framework that aims economy is largely successful to improve and grow the local skills – GVA growth has outpaced base to support a successful, globally that in the region or nationally competitive economy and labour consistently over recent years. market grounded in high-skilled and better-paid jobs, increased productivity, But its three different sub-economies and growing strong, sustainable have different needs, and that is communities. This Skills Strategy sets particularly true for this first Foundation out the actions that will be undertaken of Productivity. The interface between to drive this foundation of productivity demand for labour and places plays forward. It has three key themes: out in consequentially different ways. The evidence base for the area’s Skills ``achieve a high-quality offer tailored to Strategy builds upon the CPIER to the needs of the three sub-economies; describe this issue in detail. Together ``empower local people to access with the Combined Authority’s Public education and skills to participate Service Reform programme, the fully in society, to raise aspirations approach to skills will involve local and enhance progress into further partners working with government learning or work to help them to explore ways to overcome both stay and progress in work; and deep-rooted social challenges and the implications of rapid growth on develop a dynamic skills market `` local public services in the context of that responds to the changing significantly reduced public funding. needs of local business. A summary of the evidence and actions of the Skills Strategy Framework follows.

46 47 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Figure 9 Education Deprivation

The actions in the Local Industrial in between, ensuring that the Strategy and the Skills Strategy education and skills offer of the area show how local partners are is adapting to enable employers in working across the different parts of each economy to get the skills and Cambridgeshire and Peterborough, abilities they need from the resident with those communities at each workforce, who in turn have access end of this spectrum and those to high quality and well-paid work.

48 Nothing is more foundational for part in the economy of the area. If so, people than their education, which is aspiration and achievement will remain why it is important, if not central, to low, removing the ability of further this Strategy. Within Cambridgeshire education and the Apprenticeship and Peterborough, educational Levy to work in the way intended, outcomes are highly uneven. South and too much of Cambridgeshire Cambridgeshire has some outstanding and Peterborough will remain locked educational outcomes for example, in a low skill, low pay equilibrium, whilst and Fenland structurally unable to provide the score 308th and 241st respectively out absorptive capacity the high growth of 324 Local Authorities in England – areas of Greater Cambridge and hence why government has declared Peterborough very much need. Raising them a Social Mobility Opportunity educational outcomes across the Area. The map, on page 48, shows how whole areas is essential to rebalancing educational deprivation is unevenly the economy of Cambridgeshire spread. If some of the schools of and Peterborough and the delivery Cambridgeshire and Peterborough of the goals in this strategy. are not equipping young people with these outcomes, they can’t play their

Figure 10 UK Employee Skills Survey

49 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Technology, the rise in data driven career and vocational pathway approaches, the rapid move to promotion in schools and colleges; ‘servicisation’ and new markets ``Plugging the skills gaps – improving are rapidly changing the skills that connections between education businesses need and will continue to do and qualifications and skills and jobs so. Skilled labour shortages are in issue by ensuring all young people have for many sectors, including construction, access to quality careers advice and health and care, a range of STEM guidance to make informed choices related firms. The CPIER shows that at transition points and linking these shortages are having a greater careers to curriculum to provide impact on a wider range of businesses the support young people need to than in other regions and England as make choices at GCSE and A level; a whole.This includes on metrics such as increasing workload, creating higher ``Engagement in STEM subjects operating costs in the information in schools/colleges - embedding technology and construction sectors, the importance of STEM subjects in and meaning delays in new products schools/colleges to raise awareness of coming forward – therefore acting to jobs/qualifications that are available slow down innovation and business within growth sectors including growth potential. Cambridgeshire and manufacturing, engineering, life Peterborough partners have therefore sciences, agri-tech, digital and agreed a skills strategy that focusses information technology, construction on the overall responsiveness of the and health and social care; skills system and ensuring that people ``Connecting the disconnected - of all ages have the information improve connections with the labour and training (or retraining) needed market for those that currently to adapt and learn new skills. risk missing out, through support, Priorities transition programs, wellbeing support and community groups, Based on the evidence the with a specific focus on retraining, Cambridgeshire and Peterborough including for older people; and Skills Strategy Framework sets out six core priorities: ``Improving the evidence and evaluation base - it is imperative that ``Staff shortages in priority local partners are highly successful sectors – improving the availability through the devolved projects they of trained staff in technical currently run. Measuring impact and management roles; and evaluating outcomes effectively, ``Perception vs reality – improving ensuring that the investment yields, the perception of some sectors or wherever possibly exceeds, the and industries and improving return expected will be essential.

50 Interventions

Ambition ``Continue to develop a Work Readiness Improve and grow the local skills and Aspiration Pilot: intensive base to support a successful, globally interaction in schools in areas of competitive economy and labour deprivation, to reduce NEETs. market grounded in high-skilled Local partners will review the and better-paid jobs, increased findings of an independent pilot productivity, and growing strong, and consider locally led plans to sustainable communities. expand beyond the small number of schools currently engaged, To drive progress towards to an economy-wide scheme. achieving this priority, ``Create a Skills, Talent and Cambridgeshire and Apprenticeship Hub: connecting Peterborough will: employers, providers, and learners. ``Establish the Skills Advisory Panel to provide local labour ``Create a Skills Brokerage Service, market intelligence to support bringing together demand and supply adult funding decisions and through a new dedicated service. engagement with providers. ``Establish an Apprenticeship ``Implement changes to the Ambassador Network, a voluntary devolved Adult Education budget network of business champions to change how it is invested and encouraging businesses to overcome the related outcomes for individual reticence to create apprenticeships opportunity and business needs. and encourage uptake. ``Undertake an in-depth evaluation ``Provide sector specific support of actions being taken as part of by continuing to deliver the CITB the Opportunity Area in Fenland Construction Hub to provide on-site and East Cambridgeshire, to inform training for workers from declining future locally led interventions which sectors and military veterans. may be developed through focussed ``Look at scope to create a new work on market towns in the area. university in Peterborough, that will attract highly skilled, productive individuals to the city, and develop the skills of the local population.

51 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Working with local partners Government is working in across the Arc Cambridgeshire partnership with Cambridgeshire and Peterborough will also: and Peterborough to support ``Review labour market intelligence the delivery of this priority by: across the Arc, to gain a better ``Agreeing a Devolution Deal with local understanding of how skills provision partners that provides new powers is currently delivered and funding over transport, planning and skills, utilised. This will include working £600m investment fund over 30 closely with the Department for years to grow the local economy and a Education through local Skills further £170m to deliver new homes. Advisory Panels and providers ``Devolving the Adult Education budget across the Arc to consider how local to Cambridgeshire and Peterborough. provision supports the ambitions set out throughout these strategies; ``Implementing the Work and Health Programme, a collaborative Work with local employers to increase `` initiative between government apprenticeship uptake across (through the Department of Health the Arc, supporting employers to and the Department of Work and maximise their Apprenticeship Levy Pensions) and places to support contributions and drive social mobility. people to find and keep a job. ``Work with local employers to ``Funding the Health and Social support the effective role out of T Care Progression via levels and utilise local labour market DWP to support progression within intelligence to work with providers and across this priority sector. to consider how the local T level offer will support local businesses. ``Investing £146.7m Local Growth Fund to the area which has Establish an Arc-wide skills `` delivered, for example: marketplace, enabling the LEPs to continue to build on the positive --a new state of the art training working relationships with the facility at Alconbury Weald Careers and Enterprise Company Enterprise Zone to deliver technical, and other careers services. This advanced and higher vocational will utilise the evidence provided skills in manufacturing, engineering, by each Skills Advisory Panel, advanced construction and high- connecting businesses with skills technology industries; and providers and people with targeted --creation of new training facilities at support including apprenticeships, West Anglia Training Association STEM skills, T levels, technical in Huntingdon, specifically a and degree apprenticeships. ‘mock-up’ motorway facility and civil engineering academy. 

52 ``Working together to explore ways ``Government will commit to discussing to increase the number and range with local partners how best to of apprenticeships across multiple make the case for creating a new sectors. This will ensure the university in Peterborough. Pending Apprenticeship Levy produces the successful discussions, fundraising benefits for which it is intended and will be taken forward locally. to better support those employers to effectively utilise their levy.

Jagex

53 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Infrastructure

Drive productivity growth through infrastructure The national Industrial Strategy The Combined Authority and notes that ‘having modern and partners have recognised that accessible infrastructure throughout infrastructure is a broad issue the country is essential to future comprising transport, housing, digital growth and prosperity’. The capacity connectivity and energy. All of which of infrastructure is the limit of what is are experiencing critical issues in possible – without continually updating Cambridgeshire and Peterborough and improving infrastructure to meet that is constraining growth potential. businesses’ needs, other attempts to boost business productivity and output Evidence and barriers will have rapidly diminishing returns. Insufficient infrastructure is hampering But better infrastructure doesn’t productivity growth. As part of just enable. It can effect change, by the CPIER, a survey of businesses giving confidence to investors and in the area was carried out by companies that the success of an PWC to understand what the most area is a project the government is important issues for them were. Poor willing to put its money behind. And infrastructure was repeatedly identified infrastructure spending should itself as a brake on growth in the area. The be considered an investment – the findings were striking and even with financial and social returns of strategic the Greater Cambridge Partnership’s infrastructure projects will repay ambitious future investment strategy, the initial outlay many times over. comprising c.£600m programme of transformative infrastructure up to The Devolution Deal with government 2031, including Phase 1 Cambridge has provided Cambridgeshire and Autonomous Metro schemes that are Peterborough with funding and due to be delivered in the early 2020s, powers to deliver the locally important much more is needed. Thirty per cent infrastructure needed to drive of businesses surveyed felt that digital growth. The Combined Authority infrastructure was constraining their has responsibility for a devolved growth. Transport was another often- transport budget and government cited limitation, businesses stressing also provided a further £95m from that ‘better road networks and finding the Transforming Cities Fund, to put a solution to reduce traffic congestion towards improvements in transport. in Cambridge’ was a top priority.

54 55 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

The clear growth in demand for Employment growth is closely linked transportation into Cambridge can to demand for housing, with much of be seen by looking at the number of the employment need being met by entries and exits to Cambridge station, people moving to the area. The CPIER which has almost tripled since 1997/98. identifies both the need to increase The (TTWA) of the the rate of housing delivery and the city has ‘expanded since 2001 more need to develop housing which meets a than any other TTWA in England’17. range of needs, such as ‘intermediate’ Closely tied to issues around transport housing for those who don’t qualify for are housing difficulties – with transport social housing but are unable to get infrastructure often being key to on the housing ladder. These housing opening up new areas for housing issues are not just important for quality across the whole area. As shown in the of life, but have been identified as a diagram, employment growth has been key problem in business surveys. consistently outpacing housing growth, especially in the south of the area.

Figure 11 Growth in employment and housing stock, 2012=100

56 To meet this need, the Cambridgeshire The success of the agri-food economy and Peterborough Combined Authority is also linked to water supply and Housing Strategy has established a waste water management. Planning £40m revolving fund, which allows and investment in flood resilience the Combined Authority to go and water management delivers long beyond the Devolution Deal target term returns on investment and is of 2,500 affordable homes. The essential to support continued growth. Combined Authority will also use The area’s strengths in research, the Spatial Framework and direct artificial intelligence and digital investment in new settlements to will assist businesses in adapting encourage extra affordable housing and becoming more resilient to provision, including by developing environmental change. The provision homes for first time buyers with of significant numbers of new homes price target based on earnings. also provides the opportunity for Having the right energy infrastructure sustainable development, in how is essential for growth, to meet the communities operate and through needs of businesses and to support design, construction and ensuring the development of well-functioning, a net gain in biodiversity. attractive places to live and work. Local partners are committed to Already around Cambridge, further investment in infrastructure in a development and growth locations way that addresses wider goals of are significantly constrained due air quality, energy provision and to lack of electricity capacity. The use, biodiversity, resilience and expected shift towards electric adaption to climate changes. vehicles will add further pressure to the network as well as creating This Local Industrial Strategy supports new opportunities. The Combined the move towards more sustainable Authority also wants to ensure that methods of production, energy systems, improvements in energy infrastructure water management and modes of benefit residents, increasing the transport. In addition, it encourages affordability of supply and contributing businesses to adopt a natural capital to addressing fuel poverty. approach, taking decisions in the light of their net environmental impact. Environmental infrastructure is also essential in enabling continued economic development. Over one third of the Cambridgeshire and Peterborough area is at risk of flooding, and climate change and sea level rise will exacerbate this risk.

57 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Interventions

Ambition Working with local partners To drive productivity growth across the Arc Cambridgeshire through infrastructure. and Peterborough will also: To drive progress towards ``Collaborate with Department for achieving this priority, Transport, , Cambridgeshire and Company and Peterborough will: England’s Economic Heartland to expand the economic benefits of ``Seek to realise the ambitions in planned strategic transport links the locally agreed strategies: and improvements to the Major --Cambridgeshire and Peterborough Roads network across the Arc and Combined Authority develop the first-mile-last-mile Business Plan 2019/20; connections across the Arc. --Greater South East Local ``Work with government to develop a Energy Strategy; and shared evidence base for the current and future energy needs of the Arc, --Connecting Cambridgeshire including through the identification Delivery Plan. of opportunities to test new energy --Local Transport Plan policies or approaches within the Arc. ``Continue to deliver the ``Work with government to identify Greater Cambridge City Deal and diffuse best practice on digital worth £1bn, to improve local infrastructure planning in the Arc and infrastructure in Cambridge City explore opportunities to align new and South Cambridgeshire. transport infrastructure with digital ``Complete the Cambridgeshire infrastructure in the Arc. This will and Peterborough Strategic Bus aim to support industry to accelerate Review, on the basis of which a the roll-out of full fibre networks, Bus Task Force is being established enabling accelerated growth of to examine opportunities for 5G technologies across the Arc. an improved future service. ``Continue the rollout of the Smart Cities initiative to Market Towns, along with ongoing work by Connecting Cambridgeshire to increase superfast broadband coverage.

58 ``Work to standardise public data ``Investing £146.7m Local Growth where possible, and with support from Fund to the area which has government policy experts, to ensure delivered, for example; that the opportunities to collect and --£22m to support Ely capitalise on data are utilised – with a Southern Bypass; and view to addressing Grand Challenges around the future of mobility, the --Improvements to Bourges ageing society, and clean growth. Boulevard in Peterborough. ``Work with government across the ``Continue to deliver the wider Oxford-Cambridge Arc to Greater Cambridge City Deal explore proposals for new approaches worth £1bn, to improve local to funding infrastructure, as set infrastructure in Cambridge City out in Government’s response to and South Cambridgeshire. National Infrastructure Commission ``Funding CPCA to develop Report at Autumn Statement 2018. local energy strategies and Government is working in supporting implementation via partnership with Cambridgeshire the South East Energy Hub. and Peterborough to support ``Funding the Connecting the delivery of this priority by: Cambridgeshire programme, jointly ``Agreeing a Devolution Deal with local invested into by local authorities partners that provides new powers and the Combined Authority. over transport, planning and skills, £600m investment fund over 30 years to grow the local economy and a further £170m to deliver new homes. ``Investing £95m from the Transforming Cities Fund. ``Investing in significant new transport infrastructure through East West Rail and the Expressway, and first-mile- last-mile connectivity, as detailed in the Joint Statement on the Arc published at Spring Statement 2019.

59 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Business Environment

Increase productivity, changing the spatial distribution of growth and supporting an increase in business growth and skills levels across the whole of the local economy The evidence, challenges be taken to increase productivity, and opportunity changing the spatial distribution of Cambridgeshire and Peterborough growth and supporting an increase has a dynamic business environment. in business growth and skills levels Between 2012 and 2017, there were across the whole of the local economy. over 25,000 businesses born here, The historical growth dynamic must be compared to just under 20,000 changed. The local innovation growth businesses dying. The start-up culture hotspot of Cambridge is global in its and business creation capacity is intellectual and market reach but strong, but so too are the factors more localised in its economic and that make early-life business survival societal impact. Greater Cambridge challenging; not least cashflow. has some of the highest levels of There has been a growth in turnover entrepreneurship, where firms are of companies in the area over the created and scaled to take advantage last six years of at least two per of new business models, new forms of cent per annum, with over 10 per business and customer value and some cent in South Cambridgeshire. of the fastest growing global markets. There is a good track record of It is home to a high concentration supporting indigenous high growth of high-growth technology firms firms, supported by dense networks enabled by a world-class innovation in the Greater Cambridge economy and growth support eco-system. between entrepreneurs across sectors, The conditions that make Greater educational establishments, and Cambridge a success need to be the groups which have developed spread and replicated – primarily and play a key role on the life of the peer-to-peer and commercial the city and business environment. marketplace for innovation, growth, This is reflected in the type of productivity and market access business growth clustered in Greater support, complemented by relatively Cambridge with agglomeration easy access to growth finance. benefits around high value industries including life sciences and digital. However, as set out in previous sections, delivering the overall growth ambitions means that action must

60 61 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

A new approach to Primarily, this enhanced business business support growth support will be available to at Cambridgeshire and Peterborough least 250 firms per annum and over will create a new Global Growth 1,000 by 2024, with an emphasis Service, bringing together a range on sectors and clusters in Greater of interventions to provide support Peterborough and The Fens. to help businesses set-up and grow. Secondly, to support productivity This will include access to mentors, growth in the two sub-economies coaches, exporting expertise and new where it is currently lower, namely funding such as grants and loans. The Greater Peterborough and The Fens, Growth Hub will be the foundation the enhanced support will be structured for further development of the local so that it delivers growth in the firms growth support offer and market, which supported, that is more productive than local partners will develop to provide the firms’ previous baseline business. further, targeted, growth support to Thirdly, export growth will be supported firms in specific places. This reflects from 30 per cent to 35 per cent of GDP need to spread growth more evenly across the area, by delivering growth in across cities, market towns and rural the firms engaged, that is more export areas. The current Growth Hub will intensive than their baseline business. continue its role in focusing on the ‘long tail’ of low-productivity firms, Figure 12 shows how the Combined providing typically between one and Authority will integrate the different three of light-touch support to elements of the new business support smaller (the vast majority of current offer, targeting place and firms. A new customers being micro-firms) and Growth Company will be created to lower growth potential firms, ensuring provide capacity and drive forward inclusive support is available for all the proposed Growth Service. Its role types of business. The Growth Hub will be to shift the growth dynamic will continue to remain free and to create more sustainable growth impartial as the first point of contact. and de-risk growth. It will guide investment and interventions more This will be an of the strategically through innovative use Growth Hub and Signpost2Grow. The of funding and business models. new service will pro-actively target businesses by segment, sector, their growth potential and their leaders’ personal experience and characteristics, to increase capacity for growth.

62 Figure 12: The Combined Authority’s new business offer

63 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Interventions

Ambition ``Create an Inaugural Growth Increase productivity, changing the Investment Fund targeted at growth spatial distribution of growth and firms to fill gaps in the equity and loan supporting an increase in business market to break into new markets and growth and skills levels across the support innovation and productivity whole of the local economy. gains. Particularly in places where access to finance is more difficult. To drive progress towards ``Introduce a Global Growth achieving this priority, Champions Programme, targeted Cambridgeshire and at life science and digital sectors. Peterborough will: ``Create a new Global Growth Service ``Continue to invest in the Cambridge targeted at the places and firms Compass Enterprise Zone. that will have the most impact – ``Work with the Small Business operational from 2020 and working Commissioner to launch a new with 250 firms per year. This programme to improve business will be delivered through a new survival rates for start-up and Cambridgeshire and Peterborough early stage firms, including a Growth Company, an arms-length plan for a new economy-wide and commercially sustainable, not- payments policy for SMEs. for-profit business to bring together ``Encourage local businesses to the Growth Hub, Signpost2Grow and adopt natural capital principles. the new Global Growth Service. ``Introduce a new ‘Trade & Investment Service’ featuring an integrated and customer-focused approach to co-ordinating the Global Growth Grants and Loans with the support offered by the Department for International Trade and Buyer Credit (financing overseas customers to buy British goods) and other products from UK Export Finance. ``Establish a Global Investor Service focused on landing new firms into Peterborough and Greater Cambridge.

64 Working with local partners Government is working in across the Arc Cambridgeshire partnership with Cambridgeshire and Peterborough will also: and Peterborough to support ``Work with government, within existing the delivery of this priority by: budgets, to develop improved, ``Agreeing a Devolution Deal with local joined-up business support for partners that provides new powers high-growth firms across the Arc, over transport, planning and skills, developing an Arc-wide offer to £600m investment fund over 30 different kinds of business. years to grow the local economy and a ``Work with the further £170m to deliver new homes. to help SMEs in the Arc to access ``Investing £146.7m Local Growth the finance they need to grow Fund to the area which has their businesses. Local partners delivered, for example; across the Arc will also explore the ``the Eastern Agri-Tech Growth existing landscape and any gaps in Initiative which is supporting the finance for businesses, as well as development of new andinnovateideas the establishment of an Arc-wide within this growing sector; and business angel network to better engage with early-stage investors. ``£16.1m of Growing Places Funding to support businesses in creating jobs. ``Work with government to develop a shared understanding of ``Continuing to support the market failures in creating new Cambridgeshire and Peterborough’s commercial premises within the Growth Hub to provide high quality Arc, bringing together a range of business support across the county. analysis already being undertaken ``Supporting the development of locally, regionally, and nationally. the Alconbury Enterprise Zone. ``Work with the Department for International Trade to encourage greater trade and inward investment, building on existing engagement at LEP level and including the development of an Oxford-Cambridge Arc Internationalisation Delivery Plan.

65 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Places

Tailor and customise intervention to meet the distinctive needs of the three different areas of the local economy – Greater Cambridge, Greater Peterborough and The Fens. Economic activity does not take and attracts many international place in a vacuum. In the past place firms to operate in the area, eager has often been left out of nationwide to capitalise on the wealth of talent economic strategies, its inclusion as a and innovative potential. Similarly, it foundation of productivity recognises is home to Anglia Ruskin University a fundamental truth: how places work which has a strong reputation affects how their people and businesses attracting many students to the city. work. One of the central findings of Through various waves of innovation- CPIER is that the Combined Authority based growth, Greater Cambridge has area is not one, but three distinct cemented its position as one of the top economies – Greater Cambridge, Innovation Growth Clusters in the world, Greater Peterborough and The Fens. with multiple sector based sub-clusters This can be seen from observing and networks some also with a global travel to work patterns and examining profile. It is the centre of this area’s concentrations of sectors. This insight life sciences, digital and technology, is central to any economic strategy for education and visitor economies. the area, as it recognises that different economies have different opportunities The Greater Cambridge economy and challenges and therefore must extends out in a number of directions be treated differently. These are not across strategic corridors, such bounded areas, it is not absolute where as the life sciences sector which one economy stops and another starts. extends south through the M11/A1 innovation corridor to London and The Greater Cambridge Economy westwards to Huntingdon – which Greater Cambridge is a jewel in the also plays a significant role in the crown of the UK economy. It extends sector – and out across the Oxford- out beyond the city to the rural towns Cambridge Arc. It will continue to be and villages which surround it, and local centre of inward investment, over time have become more and more high quality apprenticeships, jobs connected to the city. This economy is and infrastructure investment. generally prosperous, with high skills and wage levels. With its prestigious university at its core, it generates many new indigenous businesses

66 67 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Science parks and incubators have The Greater Peterborough largely been subject to excess demand, Economy and the city is a high performer in Peterborough is one of the youngest and measures of innovation, such as patents fastest growing cities (by population) in per head. The city has also developed a the UK. It has grown rapidly since the globally pre-eminent and rich business arrival of the , firstly networking culture, which brings as a centre of the brickmaking industry, together entrepreneurs from different and more latterly, a centre for high- disciplines and backgrounds, leading end engineering. It has also developed to types of knowledge spill-overs and specialisms in professional services, cross-sector collaboration that drive agri-tech, logistics and distribution business growth. Many of the big tech (complemented by its strong road and businesses (such as Amazon, Apple, rail connectivity) and environmental Google, and Microsoft) have located sectors, such as water management. in the city centre, in a clear sign of its appeal to world-leading companies. Peterborough is a centre of clean growth and as an Environmental Capital is an However, success has come at a cost. exemplar for the future sustainable Infrastructure which was designed for growth of the whole economy, with a small town is struggling to cope with best practice being rolled out. It was the weight of commuters looking to named World Smart City in 2015 work in the city. Strong employment (beating Moscow and Dubai) and has growth has resulted in large numbers since further invested in pioneering of people moving to the area. And this approaches to a circular economy rapid influx of high salary workers has which this strategy will look to support had some negative consequences: and spread across the whole region. average house prices have risen from three to thirteen times average Peterborough has suffered, however, income in the last twenty years, and from poorer skills outcomes than the Cambridge has been identified as south of Cambridgeshire, with relatively the most unequal city in the UK. But low levels of degree-level qualifications, with the removal of these constraints and is in the bottom ten cities in the UK 18 Greater Cambridge has the clear ability for people with no formal qualifications . to increase its already significant This is partly due to the lack of a contribution to the UK economy. university in the city. Peterborough is also beginning to attract investment from some London-based companies looking to move professional and financial functions out of the capital. But for a city of its potential, it still attracts relatively low investment.

68 The Fens There is a high rate of ‘high employment, The Fens is an area with a history rich in low productivity’ business, which innovation, developed over generations manifests itself in low skill rates through necessity of creating success in and reduced wages. There are few demanding natural conditions. The very interactions between businesses, and a land itself is a testimony to the ingenuity lack of open engagement between firms, of engineers and the calculated risk which reduces the scope for innovation. taking of funders, who recognised In addition to these economic challenges, the potential that use of pumping there are also environmental risks, technology and water management including water management risks techniques could have to create an area for agri-food businesses. Much of the of fertile farmland. The Fens contain area is below sea level, and rising sea much of the UK’s best farmland, and an levels and increased incidences of associated industry of agriculture, agri- heavy rainfall will further increase the tech, and food manufacturing has grown risk of flooding. The CPIER recognises up as a result – carrying the legacy of flood risk infrastructure as enabling ingenuity into modern-day industry. infrastructure. If this infrastructure were The Fens are also home to a network of not in place, and ceased to function, market towns, such as March, the economic cost would be between and , which each have their £7.3bn and £8.8bn. Understanding own unique character and industrial future flood risks, and identifying and specialisms and plentiful natural capital. delivering options for managing water Many diverse businesses continue to sustainably for the future is therefore be based in The Fens, based on local critical to the area’s economic success. innovation and entrepreneurship. Nonetheless, The Fens have some unique economic challenges. The distance of some of the market towns from local cities, combined with poor transport infrastructure, has meant that populations are ageing as young people move away, and there can be a sense of economic isolation.

69 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Interventions

Ambition -- deliver the key infrastructure projects, To tailor and customise intervention notably the A10 and A505 Corridors to meet the distinctive needs of the as well as Cambridge South Station; three different areas of the local -- implement the Greater Cambridge economy – Greater Cambridge, Life Sciences Accelerator Scheme, this Greater Peterborough and The Fens. will support budding new companies To drive progress towards and help deliver necessary lab space; achieving this priority, -- academics and businesses will Cambridgeshire and be brought together to establish Peterborough will: Greater Cambridge as the preferred ``Work collectively to overcome the global base for firms from across acute growth constraints facing the world to create and adopt the Greater Cambridge and support digital and life science technologies the innovation-led economy of tomorrow. This will be supported to grow further both locally through collaboration across the Arc and into the wider region: and the establishment of a Global Artificial Intelligence Conference -- The Combined Authority is committed and a National Innovate to Grow to exploring how the longer-term (I2G) Conference in the city; growth of Cambridgeshire and Peterborough could be supported -- introduce the new Global Growth through new and innovative Champions Programme. This transport interventions. The network of 400 champions will work Combined Authority, working actively with the Greater Cambridge with the Greater Cambridge Partnership to target businesses Partnership, commissioned work in both the life science and digital to establish the in-principle viability sectors to accelerate their growth; of a Cambridgeshire Autonomous -- increase apprenticeships through Metro (CAM) network which could the introduction of a new Skills support sustainable growth in and Brokerage Service, working with the beyond Cambridge City. Local Greater Cambridge Partnership; partners will continue to develop the -- continue to invest in the Cambridge business case for the CAM, exploring Compass Enterprise Zone to further which models can build on existing enrich the business ecosystem investment to enable private sector and learn from these to inform investment for the proposed scheme. other interventions; and

70 -- alleviate perceived barriers to -- deliver the Work Readiness and growth, such as regulation, by Aspiration Pilot that will work by enhancing the Better Business for leading on intensive engagement All Programme and promoting with local schools to drive up Primary Authority to all businesses. aspiration and attainment and ``Improve skills, growing the high- prepare young people for work. productivity business base, ``Deepen business networks and and attracting investment in develop supported clusters to Greater Peterborough: improve productive, business -- examine scope to create a new growth in The Fens: university in Peterborough, that will -- develop The Fens Business attract highly skilled, productive Growth Network that will provide individuals to the city, and develop opportunities for collaboration the skills of the local population; between businesses to drive -- Develop a masterplan for the productivity growth and will evolve redevelopment of the Peterborough new clusters and networks of Station Quarter, the masterplan will businesses linked together through be used by local partners to attract the 250 Global Growth Champions investment and occupiers, both local partners will create in The Fens; private and public sector, to deliver -- develop market town masterplans high quality jobs and business space for growth, tailoring economic as part of this City centre project. policy for each market town, and -- introduce a new Global Growth increase the attractiveness of Champions Programme of 350 the towns for the new generation champions that will work actively of lifestyle entrepreneurs; with Opportunity Peterborough to -- create an Advanced Manufacturing target businesses in key sectors Innovation Launchpad that in and around the area that will will bring together local supply grow, become more productive, chain businesses, international and trade more globally; R&D institutes, national training -- continue to work to delevop providers and partners with Innovation Launchpads in areas global market access; such as agri-tech or artificial -- encourage innovation and early intelligence enabled logistics; stage growth in conjunction with -- introduce a Skills Brokerage the National Libraries Intellectual Service that will boost uptake of Property Centres in Cambridge apprenticeships, especially in the and Peterborough and assist the advanced engineering, business creation of additional IP centres in and logistics sectors; and market towns and rural areas;

71 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

-- improve infrastructure, notably ``using intelligent and sensitive the A47 upgrade, a vital transport design in new housing and intervention for the North of the infrastructure developments; and Combined Authority (especially for the ``considering ways to maximise market towns of Wisbech and March); environmental expertise across the -- expand the Eastern agri-tech Arc and to empower the business Growth Fund by £4m, this will community to champion and enable direct funding support to support the Arc’s natural assets. more firms in The Fens; and Government is working in -- CPCA will continue to review partnership with CPCA to support options for providing business the delivery of this priority by: space for agri-tech Innovation such ``Agreeing a Devolution Deal with local as that previously invested in the partners that provides new powers NIAB Innovation Hub in Soham. over transport, planning and skills, Working with local partners £600m investment fund over 30 across the Arc Cambridgeshire years to grow the local economy and a and Peterborough will also: further £170m to deliver new homes. ``Consider ways to contribute towards ``Supporting - through the the government’s Clean Growth Grand Cambridgeshire and Peterborough Challenge mission to at least halve the Devolution Deal - £4.1m of investment energy use of new buildings by 2030, to accelerate the growth of St Neots supporting the Arc’s wider ambition as part of the St Neots Masterplan, to create clean, energy efficient and the first Market Town in the Combined sustainable communities for all. Authority to complete one. Ensure that the environment ``Investing £146.7m Local in the Arc is left in a better Growth Fund to the area. state for future generations: ``Establishing a Greater Cambridge ``embodying England’s 25 Year City Deal worth 1bn, which is Environment Plan which sets out working alongside the Combined our comprehensive approach to Authority to ensure that the improving landscapes and habitats, recommendations of the CPIER and and the aspiration to move to a policy the needs of this sub-economy are of net environmental gain in future; effectively responded to locally. ``engaging with government to co-design a local natural capital planning approach for the Arc, ensuring that the wider work on productivity is aligned;

72 ``Investing over £650m, since private sector partners in Cambridge 2010, through Homes England, to to boost Outward Promotional support housing delivery across Activity to sell the Cambridge Cambridgeshire and Peterborough. brand in more global markets. ``Working with the Department for ``In partnership with the Environment International Trade and other local Agency and other flood risk partners, the Combined Authority management authorities, producing will seek to maximise trade and a jointly owned strategic plan for investment opportunities within managing flood risk, considering the area, forming a chapter of climate change and sea level risk, the wider Arc Internationalisation and take steps locally to support the Plan. This will include a Greater delivery of the resulting option for Peterborough Inward Investment managing flood risk in The Fens. Pilot to actively market Peterborough and in collaboration with the Greater Cambridge Partnership building on the work already undertaken by

73 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Priorities across the Oxford- Cambridge Arc

This Local Industrial Strategy has started to set out how shared priorities for Cambridgeshire and Peterborough fit with a wider range of activity being taken forward locally, regionally and nationally. The Oxford-Cambridge Arc cuts across in the ‘Connected Core’ of the Arc. boundaries and affects each of the Bringing these many assets together four areas in the Arc in similar ways. at scale would create a driver of These offer government and local growth and innovation for the UK. partners the opportunity to act at scale However, the Arc is not yet a single with a consistent approach across innovation ecosystem and has potential the Arc and, as with the preceding to drive greater economic growth local priorities, they can be structured and productivity: more can be done around the foundations of productivity: to connect its numerous assets in a ``Ideas – Innovation, including manner which demonstrably adds the Future of Mobility value. Achieving this will involve ``People – Skills both building existing strengths such as life sciences and providing ``Infrastructure - Energy and Digital the best environment possible ``Business Environment for the emergence of disruptive technologies. The prize is higher R&D ``Places – including Environment investment in support of the Industrial Local partners will work together Strategy’s 2.4 per cent R&D target, collaboratively across all of these UK leadership in transformative Foundations to ensure that the technologies, and a continued post- implementation of the four Local EU Exit future as a global centre for Industrial Strategies maximises science, research and innovation. the economic potential of the In order to achieve this, Arc wider Arc region as a whole. partners will work with government, Ideas UK Research and Innovation and others on the following priorities: The Arc has unrivalled science and technology capabilities – from the ``Harnessing the collective strength renowned research centres in Oxford of the Arc’s research base will be and Cambridge, to their surrounding essential. The new Arc Universities technology campuses such as Group will act as the focal point Harwell, and commercial testbeds from cross-Arc collaboration on

74 science and research, identifying To achieve this, government will work and delivering joint R&D projects with the LEPs and MCA within the Arc and providing a pipeline of talent to and other local partners, including knowledge-intensive businesses. England’s Economic Heartland, to: ``The Arc will strengthen its ability for ``Utilise the considerable R&D assets businesses to commercialise ideas within the Arc to meet the Future coming out of its universities and of Mobility Grand Challenge and others. Key to this will be a network government’s Road to Zero strategy. of ‘Living Laboratories’ that both This will put the UK at the forefront trial technologies linked to new of the design and manufacturing of developments across the Arc and zero emission vehicles, supporting help address the Grand Challenges, government’s commitment to end developed by industry and local the sale of new conventional petrol partners across the Arc. Arc partners and diesel cars and vans by 2040; will also use assets such as Harwell, ``Build on the Arc’s existing role Silverstone and Cranfield to establish as a testbed for new transport new networks that support the technologies, such as automated convergence of technologies across vehicles and drones, working with sectors and seek to develop emerging HMG and Zenzic to competitively districts such as West Cambridge. access existing research and ``Finally, the Arc will seek to grow development support, and scoping its role as a global research and further opportunities to trial innovation hub, acting as a UK mobility services within the Arc. magnet for international talent, ``Support local authorities within the R&D, Foreign Direct Investment Arc, as set out in the Future of Mobility and research collaborations. The Urban Strategy, by providing guidance LEPs and MCA will work with the on design and planning to ensure new Department for International communities are designed and built to Trade, the Arc Universities Group enable new approaches to mobility. and others to channel foreign investment in the assets and projects People that will make the biggest impact The Arc is starting from a strong on Arc-wide and UK growth. position with a well-functioning As outlined earlier, the Arc’s R&D labour market - across the Arc strengths also makes it well placed employment is high compared to to address the Future of Mobility national averages and education Grand Challenge, with many assets attainment rates are generally good. such as Culham, Cranfield, Millbrook The Arc is home to many world-leading and Silverstone playing an important higher education institutions that role in developing and testing drive the knowledge rich economy. new transport technologies. 

75 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

It is vital that the Arc continues to such as age, health or automation. build on this solid foundation in To do this the LEPs and Combined order for all people and communities Authority will continue to build on the across the Arc to have access to well-established relationships with these opportunities and businesses local partners to address these deep- have access to the workforce they rooted challenges. This will include need to meet future ambitions. ongoing engagement with Jobcentre Businesses across the Arc consistently Plus, local education providers cite attracting and retaining a and community organisations. sufficiently skilled workforce as a particular challenge. Through the newly Across the Arc, through Skills established Skills Advisory Panels, Advisory Panels, LEPs will LEPs will bring local employers and work with government to: skills providers together to understand ``Review labour market intelligence current and future skills needs and put across the Arc, to gain a better in place activity to address these local understanding of how skills provision challenges. Through these Panels the is currently delivered and funding four LEPs and government will work utilised. This will include working together to understand the challenges closely with the Department for that businesses across the Arc face Education and providers across the in securing the workforce they need Arc to consider how local provision to meet their future ambitions. supports the ambitions set out throughout these strategies. Whilst recognising the strong overall employment position of the Arc, it is ``Work with local employers to increase also essential that work to drive growth apprenticeship uptake across across the region considers how best the Arc, supporting employers to to address inequalities and challenges maximise their Apprenticeship Levy certain groups face in accessing and contributions and drive social mobility. progressing in the labour market. Work with local employers to Delivering transformational growth support the effective role of T levels necessarily requires actions to support and utilise local labour market the key growth sectors identified in the intelligence to work with providers economic context chapter above. But to consider how the local T level doing so in an inclusive and sustainable offer will support local businesses. way will also require all partners to ``Coordinate the work of Skills consider how best to: encourage Advisory Panels to bring together good quality employment across the training providers from across the whole economy; support progression Arc, with a view to establishing an for those in low pay and low skilled Arc-wide skills marketplace. This will employment and, support workers to build on the LEPs’ positive working stay in employment when they are at relationships with the Careers and risk of losing their jobs due to issues

76 Enterprise Company and other As well as getting the basics right, careers services, and work to improve there is the opportunity for a step- provision across the Arc. This will change in connectivity. Government utilise the evidence provided by each and Arc partners are working to deliver Skills Advisory Panel, connecting East-West Rail and the proposed businesses with regional and Expressway which are central to national skills providers and people enabling the long-term housing and with targeted support including business growth ambitions within the apprenticeships, STEM skills, T levels, Arc. However, greater connectivity technical and degree apprenticeships. will not be fully delivered without the There will also be continued challenge of the ‘first-mile-last-mile’ collaboration across the higher being addressed. The Arc suffers from education sectors through the significant congestion which local Arc Universities Group to ensure partners are looking to address through alignment between the higher innovations such as the proposed education offer and the emerging Cambridge Autonomous Metro and needs of breakthrough businesses, Luton DART (Direct Air Rail Transit). including top quality leadership and The LEPs have already produced management training supported local energy strategies, documenting by the business school network. the energy needs of their local areas. These will be the starting point to Infrastructure consider the energy needs of the Arc The Arc as a whole is already as a whole, drawing in new evidence, experiencing infrastructure constraints joining up local energy strategy delivery – especially in energy, transportation, and using the opportunities created water and housing. Realising shared through the growth of the Oxford- ambitions around economic and Cambridge Arc as a catalyst for a community growth will require the transformation of energy generation, development of the right infrastructure distribution and use across the Arc. to meet the needs of existing and new communities, supporting the economy of the Arc and championing the UK’s global competitiveness.

77 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

Digital and data coverage in the Arc ``local partners will collaborate with is good relative to much of the UK Department for Transport, Highways – with world-leading infrastructure England, East-West Rail Company in some of the region’s specialist and England’s Economic Heartland facilities – though it remains patchy, to expand the economic benefits of especially in rural areas. This holds planned strategic transport links, back growth given the opportunities improvements to the Major Roads for knowledge-intensive home-working network and the first-mile-last- and 5G-enabled innovations in the mile connections across the Arc; rural economy throughout the Arc. ``government and local partners will The area’s natural capital and conduct a review of recent evidence environmental infrastructure underpins work at local, regional and national- and supports the local economy, level, to develop a shared evidence offering flood protection and providing base for the current and future energy clean water and natural spaces. The needs of the Arc. This could provide changing climate will affect existing opportunities to test new energy infrastructure resilience and future policies or approaches within the Arc; infrastructure needs, requiring us to ``government and local partners will create climate resilient places and work to identify and diffuse best infrastructure. In addition, the Arc practice on digital infrastructure presents a unique opportunity to deliver planning in the Arc and explore flood risk and water management opportunities to align new through strategic activity across local transport infrastructure with digital authority and LEP boundaries. infrastructure in the Arc. This will The growth anticipated across the Arc aim to support industry to accelerate gives us a chance to test innovative the roll-out of full fibre networks, approaches to: improving digital and enabling accelerated growth of data connectivity; minimising energy 5G technologies across the Arc; demand and increasing energy supply; ``local partners will work to standardise and addressing the Grand Challenges. public data where possible - such The scale of growth also offers as through the opportunity the chance to explore new ways of created by local government coordinating and funding the delivery unitarisation in Buckinghamshire and of new infrastructure across the Arc. To Northamptonshire - and with support seize these opportunities, the Arc Local from government policy experts, Industrial Strategies announce that: to ensure that the opportunities to collect and capitalise on data are utilised. This will be done with a view to addressing Grand Challenges around the future of mobility, the ageing society, and clean growth; and

78 ``government and local partners will with existing support programmes to work together across the wider develop an Arc-wide offer to different Oxford-Cambridge Arc to explore kinds of business. They will profile proposals for new approaches to the firms that can deliver the biggest funding infrastructure, as set out in shift in growth, productivity and government’s response to National exports in places, diagnosing barriers Infrastructure Commission Report to growth in the firm’s capacity to at Autumn Statement 2018. innovate and increase productivity. As part of this, Arc partners will Business environment identify new ways to establish peer- The Arc is home to a dynamic business to-peer networks linking firms within base and a range of high-growth and and between sectoral clusters; innovative firms. However, businesses local partners and the British Business across the Arc still encounter barriers `` Bank will work together to help SMEs to growth, particularly in accessing in the Arc to access the finance they the support they need to scale-up need to grow their businesses. Local rapidly, securing the right finance partners across the Arc will also and access to the right commercial explore the existing landscape and premises to start and grow. any gaps in finance for businesses, as The Arc’s collective ambition is to well as the establishment of an Arc- become a world-leading ecosystem wide business angel network to better for high-growth businesses: with an engage with early-stage investors; environment that enables them to local partners will work with commercialise technologies, grow to `` government to develop a shared scale, and export. Central to the Arc’s understanding of market failures approach will be developing a Global in creating new commercial Growth Network of internationally- premises within the Arc. This will focused businesses, scale-ups and bring together a range of analysis sectoral clusters. Together, this will already being undertaken locally, foster a breakthrough growth region regionally, and nationally. This will and a driver for the UK economy. ensure that the right premises Partners across the Arc will work are planned for, prioritised with government and others locally within any bids for future across the following priorities: government funding, and built; and ``local partners will work with government, within existing budgets, to develop improved, joined-up business support for high-growth firms across the Arc. Central to this will be a network of the four Growth Hubs across the Arc, who will work

79 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy

``finally, partners across the Arc Places will work with the Department for Taken as a whole, this package of International Trade to encourage Arc-wide interventions, which sits greater trade and inward investment. alongside existing interventions being This will build on existing engagement progressed by government and local at LEP level and include the partners, will support sustainable development of an Oxford-Cambridge growth across the region, benefitting Arc Internationalisation Delivery Plan its residents, communities, businesses and quarterly meetings of the Arc- and the country more widely. Delivering wide trade and inward investment transformational growth in this way group. However, much more needs will create opportunities across the to be done if the Arc is to reach Arc – spreading the benefits both its potential as a global player to its prosperous centres and its able to compete with innovation- more deprived communities, and growth zones like Seoul, Helsinki, across its urban and rural areas. San Francisco and Toronto. This will include an Arc presence at Doing so will require a holistic MIPIM Cannes in March 2020 and approach and partnership working with an updated capital investment led government and industry, to achieve Oxford-Cambridge Arc Brochure growth and improve place-making, and Investment Prospectus which developing sustainable, resilient and identifies investable opportunities. culturally vibrant communities. This Work will also continue to better aims to provide a high quality of life for integrate Arc sector propositions residents - now and in the future. The into the Department for International scale of growth envisaged across the Trade’s sector and market priority Arc also offers the opportunity to plan campaigns, linking the Arc’s key for and build exemplar developments sectors into the ten highest potential with high design standards; places export and inward investment where people want to live and work. markets to drive Arc growth Heating and powering buildings globally. This will involve analysis accounts for 40 per cent of the of available data on success across total energy usage in the UK. By the Arc by sector and market. Each making new communities within of the partners will work with the the Arc more energy efficient and Department for International Trade embracing smart technologies, to develop a LEP-level ‘chapter’ for energy demand and household bills the Internationalisation Delivery Plan, can be cut, and economic growth based on the priorities and assets set boosted while meeting the country’s out in their Local Industrial Strategy. targets for carbon reduction.

80 Conserving and enhancing the in line with national policy, so local natural environment is at the heart of partners will work with government ambitions for the Arc; growth offers to explore opportunities for local an opportunity for environmental delivery of the Plan within the Arc, enhancement, in turn driving including considering issues such as productivity and innovative place climate resilience, water management making. Government and local partners and biodiversity net gain; have agreed to embed ‘natural capital’ ``local partners will also engage with thinking throughout the approach to government to co-design a local the Arc; harnessing nature to adapt natural capital planning approach to climate change, manage flood for the Arc, ensuring that the wider risk and deliver broader benefits work on productivity is aligned; to businesses and communities. ``intelligent and sensitive design Working through existing should be used in new housing partnerships, government and and infrastructure developments partners across the Arc will: to create or enhance habitats in ``consider ways to contribute towards line with national policy; and the government’s Clean Growth Grand ``government and the LEPs will Challenge mission to at least halve the also consider (i) ways to maximise energy use of new buildings by 2030, environmental expertise across the supporting the Arc’s wider ambition Arc, creating opportunities to share to create clean, energy efficient and best practice across public and private sustainable communities for all. sectors; and (ii) how to empower the As the national Industrial Strategy set business community to champion out, we will work not just to preserve, and support the Arc’s natural assets, but to enhance our natural capital working together to attract and retain – the air, water, soil and ecosystems the skilled workforce of the future. that support all forms of life – since this is an essential basis for economic growth and productivity over the long term. To ensure that the environment in the Arc is left in a better state for future generations, local partners and government agree that: ``England’s 25 Year Environment Plan sets out our comprehensive approach to improving landscapes and habitats, and the aspiration to move to a policy of net environmental gain in future. The policy for the Arc should embody this approach

81 Industrial Strategy Cambridgeshire and Peterborough Local Industrial Strategy Implementation and Evaluation

This Local Industrial Strategy will set the direction for the Cambridgeshire and Peterborough economy. Built upon solid foundations of clear evidence, it highlights where the Combined Authority and government will work together to maximise key strengths and tackle major challenges. Governance This work will report to the Arc At the local level, the Combined Leader’s Board, ensuring this Authority’s Business Board will lead workstream is aligned to shared work the implementation of this Local on place-making, connectivity and Industrial Strategy through its existing the environment, as well as central governance and delivery structures, government’s national governance embedding the Local Industrial structures, such as the Local Industrial Strategy priorities into the Combined Strategy Implementation Board Authority’s annual Delivery Plan and the cross-Whitehall Oxford- and wider programme of activity. Cambridge Arc inter-departmental The Cities and Local Growth Unit board and Arc advisory group. will work with the Business Board to engage government in delivery at the local level as necessary. At a regional level, the four LEPs, supported by the Ministry of Housing, Communities and Local Government Oxford-Cambridge Unit and Cities and Local Growth Unit, will collaborate through the productivity group of the wider Oxford-Cambridge Arc governance to deliver the shared Arc level commitments set out in all four Local Industrial Strategies for the Arc.

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Funding The Combined Authority will comply This Local Industrial Strategy does with all of the monitoring and not include any new spending evaluation requirements of each commitments outside of existing particular funding source, in addition budgets. Instead, it will inform the to the wider requirement to monitoring strategic use of local funding streams the implementation of the Local and, where relevant, spending and Industrial Strategy as a whole. decisions at the national level. Monitoring outcomes To demonstrate progress towards As well as setting out specific short- the long-term vision set out by this term actions, this Local Industrial Local Industrial Strategy, the Strategy Strategy has also set out the Combined contains a number of specific actions. Authority’s long-term aspirations and Where these actions are locally-led, the specific outcomes local partners these will be drawn from local budgets are aiming to achieve. These will help which exist for those purposes; where guide future action and evaluate actions are shared between the progress. The implementation of Combined Authority and government, this Local Industrial Strategy will they will be funded from existing local support local partners’ ambition, and departmental budgets, with funding outlined in the Cambridgeshire and allocated for those specific purposes. Peterborough Devolution Deal, for This Strategy does not represent all the priorities and action being developed in ``economic output to increase by the Combined Authority. As detailed in nearly 100% over the next 25 years; this Strategy, the Combined Authority ``inclusive and evenly occurring growth will regularly review the latest evidence across the broader base of the to continue designing the most effective economy, with marked improvements approaches and interventions to in productivity, greater exports and be at the forefront of the future UK an increase in high value jobs; economy. This Strategy sets out long- ``jobs and skills opportunities being term ambitions and will continue to available for all individuals and higher- evolve as the economy changes. skilled and better-paid jobs created for all residents across the economy’s cities, towns and rural areas, leading to greater economic growth, as well as individual opportunity and prosperity; ``businesses thriving in new and expanded clusters and networks across the whole economy, replicating the key conditions that have made Cambridge a global leader in innovative growth;

84 ``safe and adaptive transport Evaluation systems supporting an expanded The government is committed to workforce and economy, supporting devolution where there is a strong progress towards local partners’ evidence base, robust governance and ambition for residents having delivery track-record in place. Robust easy access to a good job within evaluation is an essential element of 30 minutes by public transport; demonstrating these competencies. ``local delivery of the 25 Year Local Industrial Strategy ambitions Environment Plan; and are monitored through a two-pronged ``housing being affordable, and framework. First, there will be a set of communities that are desirable SMART Business Board deliverables, places to live and work. which will be measured and reported on as part of the Business Board’s In order to ensure the opportunities Annual Delivery Plan. Second, there will in this Local Industrial Strategy are be a set of wider economic indicators, met, the Combined Authority will which the LEP can track and report monitor the progress of the outlined on, and which will – if deviating from commitments by developing a local projected trajectories – serve as Implementation Plan setting out clear a prompt for discussions with the milestones, deliverables and timings for Combined Authority Business Board, the actions set out in this strategy. In government and other stakeholders line with the national Local Enterprise around possible corrective action. It Partnership Assurance Framework, the will examine opportunities to embed Combined Authority Business Board evaluation into programmes and will produce an annual delivery plan policies where possible. The Combined and a qualitative end-of-year report to Authority Business Board will also evaluate how they and other partners continue to assess the latest evidence have contributed towards achieving on ‘what works’ for interventions, in Local Industrial Strategy objectives. collaboration with independent experts.

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1. As measured by Gross 7. Anglia Ruskin University, Value Added, ONS 2016 Buckinghamshire New University, 2. Based on analysis in the Cranfield University, Oxford Brookes Cambridgeshire and University, The , Peterborough Independent University of Bedfordshire, Economic Review (CPIER) University of , University of Cambridge, 3. https://assets.publishing.service. University of Northampton gov.uk/government/uploads/ and . system/uploads/attachment_data/ file/600239/Cambridgeshire_and_ 8. AstraZeneca and MedImmune Peterborough_Devolution_Deal.pdf (2018), Cambridge: driving growth in life sciences: Exploring the value 4. ONS: Subregional productivity: of knowledge-clusters on the UK labour productivity indices economy and life sciences sector. by city region, Table A1 (February 2019 release) 9. Silverstone Park (2017), https:// silverstone-park.com/media/latest- 5. https://assets.publishing.service. news/silverstone-park-commercial- gov.uk/government/uploads/ director-roz-bird-confirmed-as- system/uploads/attachment_data/ one-of-grant-thorntons-100- file/664563/industrial-strategy- faces-of-a-vibrant-economy/ white-paper-web-ready-version.pdf 10. Partnering for Prosperity: a new 6. Interim findings from Oxford- deal for the Cambridge-Milton Cambridge Arc economic evidence Keynes-Oxford Arc, National study (2019) AECOM and Oxford Infrastructure Commission, 2017. Economics. Taken from https:// Available at: https://www.nic. assets.publishing.service.gov.uk/ org.uk/publications/partnering- government/uploads/system/ prosperity-new-dealcambridge- uploads/attachment_data/ milton-keynes-oxford-arc/ file/785869/Oxford_to_Cambridge_ Arc_-_government_ambition_ 11. Government Response to and_joint_declaration.pdf “Partnering for Prosperity: a new deal for the Cambridge- Milton Keynes-Oxford Arc”, 2018. Available at: https://www.gov. uk/government/publications/ cambridge-milton-keynes-oxford- arcstudy-government-response

86 12. LSCC report 13. http://cambridgeshire.wpengine. com/wp-content/uploads/2017/08/ Cambridgeshire-and-Peterborough- 2015-IMD-Map.pdf 14. https://assets.publishing. service.gov.uk/government/ uploads/system/uploads/ attachment_data/file/785618/ WMS_final_Commons.pdf 15. Department for Education: UK revenue from education related exports and transnational education activity 2010-2014 (released July 2017) 16. http://smartspecialisation- hub.org/wp-content/up- loads/2019/01/2.4-PLACE. pdf?utm_source=Newslet- ter+subscribers&utm_cam- paign=5bb89dc02c-EMAIL_CAM- PAIGN_2019_01_14_11_13_ COPY_01&utm_medi- um=email&utm_ter- m=0_5ba091826c-5bb- 89dc02c-206124285 17. https://www.cchpr.landecon.cam. ac.uk/Projects/Start-Year/2015/ Refining-the-recent-release-of- the-ONS-Travel-To-Work-Areas/ Experimental-review-of-the-Cam- bridge-Travel-to-Work-Area/Report

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