Appendix 3

GLASGOW CITY DEAL ‘TOWARDS A CITY-REGION ENTERPRISE AND JOBS HUB’

ENTERPRISE PORTFOLIO RESEARCH FINAL REPORT

SMART CONSULTANCY JUNE 2016

1

Contents

Executive Summary ...... 4

Introduction and background ...... 7

PART 1 – THE CASE FOR CHANGE ...... 11

1.1 City Regions – evidence and policy trends ...... 11 The Scottish Government review of enterprise agencies ...... 11 Scottish Government manifesto commitments ...... 12 Scottish Cities Alliance ‘Empowering Scotland’s Cities – Empowering City Government’ ...... 12 Responding to the city-region context ...... 13

1.2 Current enterprise support arrangements ...... 14 Summary of service mapping returns received to date ...... 14 Conclusions on current provision ...... 15

1.3 Learning from elsewhere ...... 17 Greater Manchester ...... 17

1.4 The appetite for change ...... 20 Local authority leadership consensus...... 20 Wider stakeholders ...... 21

PART 2 - NEW APPROACHES TO CITY REGION FOCUSED ENTERPRISE, EMPLOYABILITY AND SKILLS DELIVERY ...... 23

2.1 Towards a Glasgow City-Region Enterprise and Jobs Hub ...... 23 Early action areas ...... 24 Moving forward ...... 26 Delivery and resources ...... 27

2.2 Fit with related developments...... 28

2.3 Governance and partnership arrangements ...... 29 Interim report observations and recent related developments ...... 29 Suggested governance and partnership developments ...... 29 City Region Distributive Leadership model ...... 30

2

2.4 Performance Indicators ...... 31 SLAED indicators and Scottish Enterprise KPIs ...... 31 Other indicators...... 32

2.5 Practical considerations and timescales ...... 34 Practical considerations ...... 34 Timescales ...... 35

2.6 Suggested Next Steps ...... 36

APPENDIX 1 – ENTERPRISE SERVICE MAP ...... 37 Local Authorities...... 38 Key national delivery agencies ...... 40 Higher and Further Education Institutions ...... 42 Employer intermediary organsiations ...... 44 Third sector organisations ...... 45 Procurement focused interventions ...... 47 Miscellaneous ...... 48

APPENDIX 2 – CONSULTEES ...... 49

3

Executive Summary

This report represents the second and final output of research commissioned by the Glasgow City Deal Cabinet to support its enterprise portfolio. This is led on behalf of the Cabinet by Councillor Mark Macmillan of Renfrewshire Council. The research was tasked with reviewing the implications opportunities for future support to businesses from the City Deal agreement, ensuring collective approaches recognised and maximised the opportunities from the major infrastructure investment and governance changes the Deal triggered.

The case for change

The research process was undertaken in two phases. The initial report in February 2016: reviewed the wider policy context within which developments were taking place at Scottish, UK, European and worldwide levels; summarised the economic development case for taking more of a city-region focus to enterprise service delivery and governance; mapped existing interventions provided by a range of partner agencies across the city-region; and identified some practice from elsewhere that may be of interest in considering future developments.

Part 1 of this second report details the ‘case for change’ in terms of future city-region support to enterprise. This notes some key wider messages from across the world which now highlight: the importance of city-regions as the drivers of economic growth and success; a future environment where the key competition will be between global cities; and the need to recognise and ensure that success for the city-region is reflected in all of its constituent areas.

The current significance of this agenda is reinforced by four key context developments which have taken place since the interim report was produced:

• the Scottish Government’s current review of enterprise agencies which will include consideration on the role of regional approaches

• the new Scottish Government’s commitment to establish Regional Economic Partnerships and Forums

• a major new report by the Scottish Cities Alliance calling for a ‘New Deal’ for Scotland’s cities - including further devolution of enterprise related activities

• the referendum vote for the UK to leave the European Union, which is likely to have very significant implications for the future economic development of city-regions

The research process involved looking at practice in other cities. Greater Manchester was identified as providing most direct and immediate learning for Glasgow, and although some of the context is different, the Manchester experience has informed some of this report’s recommendations.

In addition to the case for change, the research report also sought to identify the appetite for change in terms of the ambition and pace of new developments to support enterprise. This

4

was primarily tested at senior level within the city-region’s 8 local authorities, although some wider partner perspectives were gathered. For the Councils, it was apparent that a significant consensus now existed to quickly move forward ambitious new city-region focused developments.

Research, good practice and consultations highlighted that the case for future city-region action on enterprise was also largely replicated in terms of the employability and skills agenda. Moreover, practically connecting these interventions would be central to the City- Region realising its growth and jobs targets. As a consequence, the report suggests that the City-Region Cabinet should now seek to connect and integrate future action across all of these areas.

A new approach to city-region focused enterprise, employability and skills delivery

Based on the case and appetite for change, section 2 of the report suggests future actions the City-Region Cabinet should now advance. These are recommended to start with a clear statement of intent to seek to align local authority and a wider range of partner services into a consistent and consistently communicated city-region wide offer for businesses and people seeking to access and progress in work. Actions to advance this are recommended as being advanced through the concept of a ‘City-Region Enterprise and Jobs Hub’.

This is suggested as evolving initially as a mixture of locally delivered services ‘re-badged’ and recognised as part of a consistent city-region wide support service, and thereafter extending this to the aggregated delivery of relevant services at a city-region level.

7 early action areas are identified to begin this process:

• definition and communication of single enterprise offer for region

• development of a Glasgow City Region Business Gateway service

• development and promotion of an enterprise asset map/directory

• a region wide business development initiative to engage and connect further with resources and activities in the HE/FE sector

• a Glasgow City Region information and intelligence Hub

• combined sectoral initiatives

• IT/digital support initiatives

At this stage, no specific recommendations are suggested for employability and skills interventions. These were not the focus of this research. But the report suggests that these agendas are closely linked, and that the overall City-Region Enterprise and Jobs Hub should include potential incorporation of these services

5

In practical terms, the City Region Economy Sub Group will now be tasked with taking this forward by initially agreeing a future action plan based on the recommendations of this report, and then progressing this accordingly. As wider relationships further develop, it is anticipated that relevant staff from partner agencies will also be invited to join the process of developing a Regional Enterprise and Jobs Hub.

The approach recommended in taking forward the City Deal’s enterprise portfolio also demands a number of key partnership and governance developments. These have wider implications beyond the enterprise portfolio, and link to the Scottish Government’s commitment to develop Regional Economic Partnerships/Forums and the current review of enterprise agencies.

It is recommended that the City-Region Cabinet now:

• fully engage key partners in the City-Region partnership. As a minimum this should include: Scottish Enterprise; the Scottish Funding Council; Transport Scotland; SPT; Skills Development Scotland; the Department of Work and Pensions; and when appropriate the Scottish Government. Appropriate engagement structures should be established at the political, senior management, and operational strategic management levels

• continue to support the progress of the private sector Regional Economy Forum chaired by Lord Haughey to ensure that the Scottish Government’s intention to ensure meaningful business input to Regional Economic Partnerships is addressed within city- region structures

New approaches to enterprise support at the city-region level also demands consideration of how future progress or ‘success’ would be evidenced. Consequently, the research sought to identify the key performance indicators. An outline framework is suggested in the report based on a combination of indicators used by SLAED, Scottish Enterprise, and from a number of other key national strategies. It is suggested these are now baselined within the wider Regional Economic Development strategy.

The City Deal Cabinet has indicated a wish to move forward developments on the Enterprise portfolio with considerable urgency. This is to ensure the views and suggestions of the Cabinet feed into, inform and gain from other related developments now moving forward quickly – most notably the review of enterprise agencies, and anticipated announcements on Regional Economic Partnerships.

In addition, a full action plan to move forward the recommendations in this report is recommended to be agreed by October 2016.

6

Introduction and background

This report represents the second and final outcome from research the Glasgow City Deal Cabinet commissioned in support of its enterprise portfolio. It follows on from the first phase report, and requires to be read in conjunction with some of the detail contained in that document1.

Research and consultation for both phases of the research confirmed strong support for the economic and social benefits of taking an increasing service and policy focus on the city region geography. These issues are considered further in the following section. In Glasgow, this had moved forward a stage through agreement between 8 city-region local authorities, and the Scottish and UK Governments to establish a City Deal in August 2014. Through a series of major infrastructure projects and related enterprise and employability initiatives, the Deal aims to stimulate economic growth and create new jobs across the city region, and in a way that benefits all areas and all communities.

The interim enterprise report summarised a wide and substantial literature and policy context which increasingly emphasises the popularity of taking a strategic city region focus. This is a worldwide trend which recognises the critical contribution of city regions to national economic performance. In other parts of the UK it has informed the establishment of 26 City Deals, and now further development of wider devolution deals. In Scotland, it has led to the agreement of further City Deals for Aberdeen and Inverness, with more anticipated. Whilst individual City Deals vary, and in particular there are some key differences between the English/Welsh and Scottish experiences, taken together these developments mark a significant change in the governance landscape – in Scotland and across the UK.

This is the wider context within which the enterprise portfolio research was conducted. Whilst aspects of these developments go well beyond the brief for this work, without understanding this context it would be difficult to identify and make the case for changes in enterprise supports at the city-region level.

This research has also demanded linkage with other work-streams developing a regional economic strategy, and a regional skills and employability strategy. Consequently, a challenge throughout this work has been to specifically address opportunities and implications for enterprise related services, whilst recognising that these interconnect with a series of other developments. As a result, some of the observations and suggestions for action are enterprise specific, whilst some have wider implications.

For the enterprise portfolio specifically, feedback on the first phase report signalled that the case for, and benefits of, a city-region approach were shared across constituent City Deal authorities, and many wider partners. The demand of the second phase work was subsequently to suggest recommendations for action related to enterprise support that followed the city region logic into practice in terms of: how services were delivered and designed; how resources were allocated, and how authorities worked together with wider partners at a regional level.

1 Glasgow City Deal Enterprise Portfolio research – interim report: Smart Consultancy (March 2016).

7

This demands identifying all relevant supports currently supporting enterprise, and considering the best future location of these at Scottish, city region and local authority level.

Overall, consultations suggested that this was a debate overdue in the Scottish context, and one that could be further stimulated by the expectation that the programme of new Scottish Government will involve the creation of new Regional Economic Partnerships.

In practical terms for local authorities, any potential changes require consideration of:

• services currently delivered and focused at local authority level that could be aggregated up in some form to the city-region level, and

• services currently delivered at a national level that could be devolved down in some form to the city-region level

These are challenging developments, but in many ways this is not a new debate. It demands consideration of the appetite for change, and the potential for consensus to move in this direction. For a number of reasons, this appetite may now be greater amongst both City Deal authorities and the Scottish Government.

Local authorities can largely control developments in the ‘aggregated up’ category for services they deliver or fund, whilst ‘devolution down’ demands negotiation and discussion with the Scottish Government and some key national agencies. This report recommends that the City Deal Cabinet signals an intention to move forward immediately on options to align and integrate local authority controlled services, and uses these developments to engage and seek a response to the wider agenda of disaggregating delivery downwards from the national level.

Suggestions in this report on how local authorities could develop a more city-region based response on enterprise services do not constitute a full business case. This will require more work across the partner authorities. But ‘internal’ local authority consultations undertaken in this research indicate a strong intention to progress quickly, and this should inform the pace and nature of the next stage of the developmental process. It is also suggested that the logic of this way forward transfers to the employability and skills agenda, and that future work should consider the inclusion of these interventions alongside enterprise developments.

Process

The overall research process undertaken for the enterprise portfolio research is summarised in the diagram below:

8

How is How do we enterprise Does the What is the work with What do we Learning What Starting currently CR level ‘enterprise each other measure as from should we points supported matter in all agenda’? and wider ‘success’? elsewhere? do now? in the CR this? partners? area?

Details of the first 7 stages are contained in the interim report, though some issues have been revisited and tested further in the second phase process. Overall, the second stage primarily addressed the final issue – based on the findings, ‘what should we do now?’

The second stage of work included:

• discussions with the Council Leaders and Chief Executives of the 8 constituent local authorities

• discussions with lead enterprise and employability officers in the local authorities

• further discussions with officers in the Scottish Government, Scottish Enterprise, and the Glasgow Chamber of Commerce

• a study visit to Greater Manchester to discuss related work there on the Greater Manchester Growth Hub, the Greater Manchester Growth Company, New Economy Manchester, and a specific region wide sectoral initiative ‘Cottonopolis’. This visit also included a discussion with the Chief Executive of Greater Manchester Chamber of Commerce

• ongoing liaison with the Leader of Renfrewshire Council (as City Deal lead for Enterprise), and senior officers in the Council – including submission of an emerging findings paper in May 2016

• input to a meeting of the City Deal Economy sub group

• ongoing research on relevant city-region enterprise related KPIs and baselines, and on further wider city-region developments – most notably developments during and after the 2016 Scottish Parliamentary elections, and an important new publication by the Scottish Cities Alliance

• input to series of City Cabinet and workshop events in early June 2016, including a presentation on the projected nature of this report, and feedback on areas of consensus apparent from the Council Leader discussions

9

• ongoing liaison with consultant colleagues working on the city-region Economic Development strategy and the Skills strategy

• submission of the final report, initially in draft form, and following discussion and feedback, preparation of a final agreed version

10

PART 1 – THE CASE FOR CHANGE

1.1 City Regions – evidence and policy trends

The interim report identified that a very significant lobby and supporting research now advocates the importance of vibrant city-regions to overall economic prosperity. This is supported by a wide range of strategies at the Scottish and UK levels, and trends in many other countries in Europe and beyond. The Glasgow City Deal has provided a further dynamic to this debate, as has the proliferation of City Deals across England and now other parts of Scotland. If the other 3 main City Deals in Scotland currently under consideration are finalised, over 76% of the population will live within a City Deal area.

These developments recognise the scale, concentration of resources, networks and marketing appeal of cities. The arguments also posit that the core geographic unit which defines the city-region is much wider than the boundaries of a single local authority. In terms of enterprise, the city-region case notes that the future economic development challenges will be between global cities; in this context local responses have to move from narrower intra-region competition to an acceptance of a common destiny at city-region level. In short, that all constituent areas will benefit from the success of the whole region.

In terms of governance, service delivery and resource allocation mechanisms there is consequently a need to consider how current arrangements reflect these trends in practice, and whether any changes could assist Glasgow City Region to maximise its potential. This report focuses on the implications of these issues for the enterprise agenda, but many of the core principles extend into other areas - most immediately the delivery of employability and skills interventions.

Section 7 of the interim report provides more detail of this debate, and it is consequently not considered further here. But three developments since the interim report was produced are of significance and worth noting. These developments within a period of just two months are themselves indicative of an intensifying Scottish dynamic on this agenda.

The Scottish Government review of enterprise agencies

In late May, the First Minister signalled a commitment that over the summer the new Scottish administration would carry out ‘…a major review of the roles, responsibilities and relationships of our enterprise development and skills agencies’. This was followed by the publication of the terms of reference of the review in mid-June. These indicate the main agencies covered in the review are: Scottish Enterprise (including Scottish Development International); Highlands and Islands Enterprise; Skills Development Scotland; and the Scottish Funding Council. But the review will also take account of the economic development role of local authorities, Visit Scotland and Creative Scotland, and the need for complementarity across all interventions.

Of specific relevance to this research, the review’s remit includes consideration of ‘…how local and regional approaches that build on national and local assets and relationships can best exploit and tackle’ economic and skills opportunities and challenges. 11

It is clearly too early to suggest the likely outcomes of the review, but the immediate governmental priority signalled and the speed of the process may be significant. It is likely that national/regional arrangements will be one of the issues under consideration in the review process.

Scottish Government manifesto commitments

The SNP manifesto for the 2016 Holyrood elections contained some key commitments related to the City Region agenda, and to enterprise policy development. Following the party’s return to power, relevant actions are contained in the new programme for Government. Two commitments are of most relevance:

'To target growth in regional economies we will also establish Regional Enterprise Forums, led by enterprise agencies with strong private sector involvement, to promote and oversee local business support'.

And in terms of 'Local Governance', a commitment to:

'Continue to grow and develop City Deals, Town Centre Partnerships and Regional Economic Partnerships so that clusters of agencies and shared interests can work together for the benefit of their local economies and communities'.

Further clarification can be anticipated on the intended relationship between ‘Regional Enterprise Forums’ and ‘Regional Economic Partnerships’, or whether these are in practice likely to become one and same. Either way, how enterprise agency led Regional Economic Partnerships and local authority led City Deals with economic growth and employability targets align is anticipated to be a key issue in determining the future regional economic landscape.

Scottish Cities Alliance ‘Empowering Scotland’s Cities – Empowering City Government’2

Published in June 2016, this report is based on research commissioned by Ernst and Young earlier in the year. The report calls for a New Deal in the relationship between Scotland’s cities and the Scottish and UK Governments. A key element of this is suggested as:

‘…a radical change in the approach to economic development within Scotland’s cities. We want to work more effectively with Enterprise and Skills agencies to both enhance conditions and to foster opportunities for local business to grow.’

This is based, amongst other reasons, on concerns that projections suggest Scottish cities will be out performed by their comparable English counterparts in the period 2015-2020, and that the trend to devolve further powers to English cities may exacerbate this divergence. Consequently, the SCA report outlines the following as the basis of a ‘new deal’:

2 Empowering Scotland’s Cities – Scottish City Alliance (June 2016).

12

We Want We Will Stakeholders Impact To work more effectively Work as a cross city Scottish Government in Opportunities to work with Enterprise and Skills collective to establish a its review of national collectively to develop agencies to create better clearer process for agencies solutions to the big conditions and engagement between challenges facing opportunities for cities and all Government Scotland’s cities such as businesses to grow agencies inequalities, the attainment gap, the Cities to share in decision Commit to finding more Scottish Enterprise, productivity gap and making with national efficient ways of working Highlands & Islands equipping the labour agencies at a policy level and de-cluttering Enterprise and force of the future in relation to enterprise overlapping agendas Department for Business and skills Innovation and Skills All parties play to their relative strengths to drive Cities to be given a clear UK Trade and Investment enterprise and business strategic role in directing and Scottish growth national agency Development investment into cities and International regions Scottish Funding Council Cities to have a clear role and Skills Development in the Scottish Scotland Government’s announced review of national agencies

Brexit

As this research was concluding, the UK voted to leave the EU. Although the precise shape of Brexit is far from clear at this stage, it is certain to be detrimental to cities in terms of the loss of very significant EU funding support – impacting generally across the region, and also directly within some of the Glasgow City Deal’s employability and business development programmes. In competitive terms, the changing trading status of Glasgow in the European city-region context is likely to be very challenging. Brexit will consequently present further leadership challenges for the City Deal Cabinet. These reinforce the need to ensure strong and co-ordinated city region leadership which is inclusive of all public sector partners and the business community.

Responding to the city-region context

Both the longer term agenda, and more recent Scottish and UK developments, are potentially relevant to the future development of the Glasgow City Deal and city-region. This has already been recognised by the City Deal Cabinet who have agreed to respond positively and constructively to help inform and shape these processes. This will include suggestions to maximise the existing and evolving city-region infrastructure as a central point of more integrated regionally focused approaches.

These issues incorporate but extend well beyond the enterprise portfolio research, but are nonetheless considered further later in this report.

13

1.2 Current enterprise support arrangements

The interim report summarised the current delivery landscape of enterprise related supports operating across the city-region. This was based on a definition of the ‘enterprise agenda’ agreed at the start of the process as:

‘The ‘enterprise agenda’ incorporates the way in which all services which support business start-ups, sustainability, growth and diversification combine together to advance the economic growth objectives of the City Deal’.

The definition then provided the starting point for the mapping study of relevant partner enterprise interventions. Specific services prompted in this were3:

• Enterprise and business skills training • Start up support • General business growth support/sustainability • Globalisation support • Procurement and supply chain supports • Social enterprise specific supports • Support to academic research/business links • Business premises and infrastructure • IT infrastructure support • Sources of finance

The final service map identified that 33 separate agencies and organisations provide relevant interventions.

Summary of service mapping returns received to date

Category Returns received Local authorities (8) • East Dunbartonshire Council • East Renfrewshire Council • Glasgow City Council • Inverclyde Council (incorporating Riverside Inverclyde) • North Lanarkshire Council • Renfrewshire Council • South Lanarkshire Council • West Dunbartonshire Council Key national delivery agencies (2) • Scottish Enterprise • Skills Development Scotland (interim return) Higher and Further Education Institutions • Glasgow University (10) • Glasgow Caledonian University • Strathclyde University

3 It was agreed at this stage not to include interventions delivered within schools.

14

• University of the West of Scotland • Glasgow School of Art • Glasgow Clyde College • New College Lanarkshire • South Lanarkshire College • West College • Glasgow Kelvin College Employer intermediary organisations (3) • Federation of Small Businesses • Glasgow Chamber of Commerce • Renfrewshire Chamber of Commerce Third sector organisations (5) • CEiS • Engage Renfrewshire • Entrepreneurial Spark • Lanarkshire Enterprise Services • Prince’s Trust Scotland Procurement focused interventions (2) • Scotland Excel • Supplier Development Programme Miscellaneous (3) • Clyde Gateway Urban Regeneration company • Jobs and Business Glasgow • West of Scotland Loan Fund

An updated summary of the interventions provided by these sources is contained as appendix 1. However, this is unlikely to be a comprehensive list of all supports available, and in addition the map can only represent the situation at a ‘moment in time’. Some of these supports will change over time or disappear, whilst new approaches will be added. It is a caveat applied to most mapping related work that is difficult to avoid.

A further issue is the interpretation of the term ‘enterprise supports’. It is apparent in survey responses this was considered to include wider interventions that are closer to the employability agenda. These have been removed from the analysis at this stage. This is to support focus in this research, but the practical links between these related supports remains critical in practice. This is reflected in later recommendations.

Finally, a distinction has to be made between agencies that fund services and those who deliver them. Without this the service map would erroneously suggest a duplication of interventions. In the summary contained as appendix 1, where possible services are presented by delivery agency. This is probably the most useful representation for employers seeking to understand the landscape, and when organisations are seeking to work together most effectively at an operational level. In planning and potentially redesigning services, organising the map by funding source may be of more value.

Conclusions on current provision

This is clearly a significant number of support sources, and leads to an overall sense of a ‘busy’ landscape. A number of factors are important in explaining this varied range:

15

• many of the services do not cover the whole city-region area – most notably virtually all the local authority services are focused at Council area level. In practice, these are often the same or very similar services delivered within different geographic units

• the scale of interventions both in terms of the nature of support, the number of businesses engaged, and the costs of support provided varies enormously – many interventions are in reality very small scale

• the services reflect the wide ranging needs of businesses including advice, grants, loans, training, market development, procurement, property support etc

• many of the services are targeted at businesses at different stages in their development profiles - from start up to various levels of growth

• many services are targeted on employers of a certain size – with some recognised progressions in place as businesses grow

• a group of services are specifically focused on social enterprise development

These reasons explain why a range of supports are to be anticipated. A challenge for partners in the city-region context, however, is to consider the degree to which these interventions come together to provide a cohesive, integrated and logical response to advancing the enterprise agenda. And the degree to which these provide an understandable, collective service response that addresses the needs of all existing or potentially new businesses seeking support.

Consultations suggested some good examples of co-ordination across services, but within a fairly consistent sense that this could be improved. These discussions largely reflected observations from an individual local authority area perspective – how all this works together at a city-region level has not been significantly considered to date. This issue goes to the heart of how the City Deal structures may wish to reconsider support to enterprise.

The previously referenced Scottish Cities Alliance report of July 2016 reaches a similar conclusion across all Scotland’s cities, noting ‘…a cluttered landscape remains for enterprise in terms of who is best placed in the public sector to support innovation and early business growth’. As the largest city-region, it can perhaps be assumed that in Glasgow this situation is most marked.

Reflecting current arrangements, the recommendation of this report is to work towards a more integrated approach aligning services more at the city-region level where applicable. In the first instance, this demands that the local authorities themselves re-assess the relevance and effectiveness in a city-region economic development context of operating either very similar or ‘competitive’ programmes between each other. This process then requires other agencies operating with a different geographic focus to also consider aligning services further to respect city-region dynamics. The mapping study in this research provides a starting point, and later the report suggests some practical early action areas to test new approaches.

16

1.3 Learning from elsewhere

The initial research report identified some practice from elsewhere in the UK, Europe and across the world that highlighted other service and governance responses to the city-region agenda. From this, it was identified that developments in Greater Manchester have perhaps the most directly comparable lessons that could inform future service development ideas in Glasgow. Consequently, a study visit was undertaken supported by some pre and post visit desk research and telephone consultations.

Greater Manchester shares a number of characteristics with the Glasgow city-region, but some of the context is also quite different. Key similarities include that GM is a ‘mono-city’ region with 10 local authorities, and has some similarities in terms of industrial history. It also recognised as an increasingly successful and effective city-region model which is widely accepted as being at the leading edge of the city devolution process in the UK.

Greater Manchester has, however, key differences from the Glasgow situation that need to be factored:

• it is significantly larger than Glasgow with a combined population about one million higher. But this is within the context that Manchester sits within a national government unit which covers approaching 60 million people – comparatively it is consequently far less significant in the English context than the Glasgow city-region which incorporates a third of the Scottish population

• consultees stressed that current arrangements in Greater Manchester are the result of a development period covering a number of decades. This has resulted in a governance structure which now includes a combined Greater Manchester authority, sitting alongside the constituent local authorities This arrangement is currently unique in the UK

• more recent and ongoing developments in Greater Manchester have more been associated with the process of further devolution to the city-region, and in many ways are a response to the devolution process in Scotland that has, to date, been focused at the national level

• specifically linked to the enterprise agenda, developments in Greater Manchester have taken place to the backdrop of the abolition of Regional Development Agencies across England in 2011. The Glasgow city-region equivalent – Scottish Enterprise – still exists, representing a significantly different operating landscape

These differences are important in determining the nature and pace of potential developments in Glasgow city-region. But nonetheless, it is suggested they contain some potentially replicable good practice.

Greater Manchester

The overarching strategy and delivery mechanism in Greater Manchester is the group of companies collectively coming together as the Greater Manchester Growth Company

17

(GMGC). This is governed by a Board with equal representation from the Greater Manchester Combined Authority (GMCA) and the private sector. The company is jointly responsible to the GMCA and the Local Economic Partnership (LEP). Three Advisory Boards with wider membership are responsible for: Workforce Development; Business Support and Business Finance; and Internationalisation and Marketing.

The overall aim of the GMGC is to work together to transform the economy of Greater Manchester. Overall services cover: skills; employability and careers interventions; business support at all stages of the growth pipeline; and bespoke packages to support inward investment.

Within the company portfolio is the Greater Manchester Business Growth Hub which co- ordinates a wider range of business support services across the city-region, including:

• a growth service • growth start up • mentoring growth • growth leadership • innovation growth • digital growth • green growth • access to finance • sectoral programmes in: digital, creative and technology; life sciences; low carbon and environmental goods and services; manufacturing; and a textiles growth programme

The Growth Hub seeks to work as a cohesive unit both brokering and delivering services. It operates on a ‘hub and spoke’ basis with some functions still delivered by individual local authority business teams. It is primarily resourced through a combination of local authority contributions, the imaginative use of EU funds, and the UK Government. In practical terms, secondments from individual authorities have augmented capacity, and these have proved to be increasingly popular. KPIs relate to jobs, business assists and supports.

The hub is based around a partnership model that extends far beyond the constituent local authorities. It now has over 170 member organisations ranging across the private and public sectors, and wider civic society.

A further key element of the Manchester package – also contained within the GMGC – is New Economy. This is a dedicated research and development capacity for the city-region providing high level analysis and evaluation services to inform evidence based economic development. Specific services include support to:

• business and science • European policy and funding • planning, housing and the environment • research, evaluation and community benefit analysis • skills and employment • strategy

18

It should be re-emphasised that it has been an extended journey in Greater Manchester to reach this stage, which has taken place within a different context. Moreover, and in part due to the gestation period, local consultees reflected on a widespread instinct to ‘think city- region’ that is not yet embedded to the same degree in Glasgow. With these provisos, however, some aspects of the Greater Manchester approach are of potential relevance. These are reflected in the early action areas suggested to develop a ‘City Region Enterprise and Jobs Hub’ detailed in section 2.1.

19

1.4 The appetite for change

Alongside policy and strategy drivers, and potential change options, a critical consideration is the appetite for change. This has two dimensions: the degree to which services and governance changes are important; and the degree to which these are considered urgent.

The other obvious consideration here is the consensus or otherwise amongst a wide range of stakeholders, and the degree to which views align as the basis to practically move forward.

Research within this study has primarily focused on identifying the views of the 8 local authorities. This reflects that the local authorities have a strong wish to lead on this agenda, and that this leadership has to come from the most senior elected member and officer levels.

Some observations are also made on the views of other key partners on these issues, and are reflected below. But discussions were held at a period of new policy development and reviews, linked to a new Scottish administration. Consequently, and understandably, definitive views by wider partners were difficult to offer.

Irrespective of this, the recommendations of this report are for the local authorities to move forward developments in areas that they directly control, in particular how some activities could be aggregated more with a city-region focus. This would then provide a platform to enable and encourage a response at this geographic level from key partners.

Local authority leadership consensus

Specific consultations with the leaders of all 8 local authorities in the spring of 2016 indicated consensus on a range of key points central to moving forward. These were then tested, discussed further, and confirmed at a leader’s workshop in early June. The issues clearly extend to areas well beyond the enterprise research, but they directly inform the appetite and potential pace of change on this (and other) agendas.

• the city-region is agreed as the functional economic geography required to maximise jobs and growth, this is based on strong international and UK trends

• this is a ‘win–win’ for all areas – but this point needs continual articulation and supporting evidence

• ultimately the city-region agenda is about jobs and prosperity for all areas and communities, and over time it must include evidenced impact in areas of relative deprivation

• clear and committed political leadership is essential and this will be consistently provided by the Council leaders

• this is important and urgent

20

• local authorities should ‘shape and lead’ rather than ‘respond and fit with’ emerging new developments in the city-region. Developments in the wider Scottish political context now indicate that some form of change is on its way, bringing both opportunities and challenges for the City Deal Cabinet

• Glasgow city-region needs to stay ‘up with or ahead of the game’ – other Scottish cities are moving in similar ways; in England cities are now being significantly empowered; and international examples indicate strong gains from city-region approaches

• new developments need to respect both ‘aggregation up’ and ‘devolution down’ to the city-region geography

• local authorities will now show a lead in respecting the city-region agenda by translating theory into evidenced practice and change – suggested early actions from the enterprise portfolio should continue this process

• local authorities need to build wider partnerships with other agencies and the business community – based on inclusion, engagement, and consensus

Reflective of this significant consensus, the City Deal Cabinet meeting on 7th June 2016 agreed a series of immediate and practical actions to move forward. General actions were identified as:

1. Agreement and the allocation of briefs and initial tasks for each Council leader under a distributive leadership model.

2. Agreement to engage key partners in City-Region economic planning, including Scottish Government ministers, Scottish Enterprise, Skills Development Scotland, SPT, the Scottish Funding Council, Transport Scotland, the Department of Work and Pensions and potentially others.

3. Agreement to further engage and accelerate private sector/business engagement.

More detail on these actions are contained in section 8.

Specific to the enterprise agenda, the Cabinet agreed:

4. Early action to move towards a ‘Regional Enterprise and Jobs Hub’. This is now considered in section 6.

Wider stakeholders

As indicated above, the views of other partners are less easily summarised given the fluid policy and review context. But from discussions with Scottish Government officials, and staff of Scottish Enterprise it is apparent there is a significant and growing interest in the city- region agenda in terms of new potential partnership arrangements and potential new delivery models. Related developments of interest in England and beyond are recognised,

21

and the overall Scottish Government view on the importance of successful cities is powerfully reinforced in the 2016 refresh of ‘Agenda for Cities’. Moreover, the new Government’s commitment to establish Regional Enterprise Partnerships/Forums, and the review of enterprise support agencies both indicate an interest in a refreshed look at regional level potential.

There are also some indications of interest from the business community in new regionally focused enterprise and economic development approaches. But these need to be further investigated and tested. It is suggested in section 2.3 below that further work by the business led Regional Economy Forum chaired by Lord Haughey will be critical to ensuring this key stakeholder group are partners in further shaping new approaches. This reflects the importance the City Deal Cabinet places on meaningful and practical involvement of the private sector in informing and guiding a positive future vision for the city-region – providing additional insights, ideas, and expertise to enhance the work of public sector partners.

22

PART 2 - NEW APPROACHES TO CITY REGION FOCUSED ENTERPRISE, EMPLOYABILITY AND SKILLS DELIVERY

2.1 Towards a Glasgow City-Region Enterprise and Jobs Hub

Based on the findings of the process, the enterprise research was requested to identify some early practical actions that the City Deal Cabinet could advance. This is now suggested as starting with a clear statement of intent to seek to align local authority and a wider range of partner services into a consistent and consistently communicated city-region wide offer for businesses and people seeking to access and progress in work.

Actions to advance this are suggested as being based around advancing a ‘City-Region Enterprise and Jobs Hub’. In addition to the wider issues of context above, this is suggested leading from:

1. Overall buy in to the city region enterprise perspective (and wider regional economic development rationale) amongst member authorities – with an assessment that this will: maximise growth; reflect the reality of a city-region economy and labour market; produce gains for all areas and communities; and eliminate approaches based on ‘intra-region’ competition.

2. A willingness shared across the local authorities to take the lead here through practical early actions at a city-region level which show a demonstrable commitment on these issues.

More specific enterprise related research findings which support moving forward in this way are:

3. Recognition that the current enterprise support map is: cluttered; involves potential duplication; restricting opportunities for economies of scale; sometimes promotes intra- region competition; and that local authority area focused delivery infrastructures may potentially be a ‘harder sell/easier to refuse’’ proposition to secure partner engagement than a more regional approach.

4. Practice that indicates some related services can operate effectively above an individual local authority level eg West of Scotland Loan Fund, the Supplier Development Programme, Scotland Excel; and some aspects of Business Gateway (though these are not all ‘regionally’ structured).

5. Evidence from elsewhere – particularly Greater Manchester - that regional hubs are viable and can be effective – though some of these operate on a much larger scale than is likely to be practical in Glasgow at this stage.

6. Some evidence/expectations that businesses would respond positively to more regionally focused delivery mechanisms.

23

The City-Region Enterprise and Jobs Hub is suggested as evolving initially as a mixture of locally delivered services ‘re-badged’ and recognised as part of a consistent city-region wide support service, and thereafter extending this to the aggregated delivery of relevant services at a city-region level. This would require to evolve alongside new city-region partnership and governance arrangements.

The second phase here is likely to be more challenging, and it is suggested relevant areas are selected on the basis that one or more of the following apply:

• a clear and easy ‘regional gain’ is apparent in terms of economies of scale, and where individual authorities are currently duplicating effort

• current approaches appear to be generating intra-region competition – against the premise of the wider city region vision

• the service offer delivered by individual Councils appears very similar in nature, and where as a consequence some regional collaboration in design, management and reporting may have potential

• (in the current context in particular) individual Councils - and also potential partner agencies - cannot by themselves apply the optimum level of resource to the service/activity

Early action areas

The service audit, wider research and consultations at this stage suggest a list of areas where coalescing around a regional hub focus may have some potential value.

Commitment/definition/communication of single enterprise offer for region

This will include developing and articulating a city-region wide statement of the minimum expectations all businesses should have of enterprise related support – irrespective of where they enter the system or operate. It is premised on recognising business development in any part of the city-region benefits the whole city-region. In practice, there will remain specific local authority area additions to the offer, but these should also be articulated and discussed within the development process. The full service mapping returns (detailed in a separate research document) will provide a starting point for this process.

Development of a Glasgow City Region Business Gateway service

A significant element of the current local authority enterprise support service is the Business Gateway. This is delivered at individual local authority level, with 4 local authorities undertaking a lead management and reporting role. Business Gateway is a national initiative, but in recent years the services delivered have become increasingly diverse across different areas, with very significant local variations.

24

Given the wider city-region enterprise case made elsewhere in this report, it is suggested that partner local authorities should now move towards a city-region managed Business Gateway service. This would: provide a renewed consistency in the offer; reduce the number of management, contracting and reporting arrangements; and increase the potential for more integrated city region wide events and training activities. In practical terms, this would probably require a single authority assuming the Business Gateway lead role across the whole city-region area.

Further consideration will be required on the timing of these developments. Currently different arrangements are in place between in-house and externally contracted services, and the timeframes of existing contractual arrangements need to be factored. A new regional approach to Business Gateway delivery will also require to agree an appropriate future relationship with the Business Gateway National Unit based in COSLA.

Related and supporting practical work can be advanced more immediately linked to increased Business Gateway integration. It is apparent from local authority service mapping returns that a number of events and training activities are delivered at individual local authority level. Many of these are delivered through the Business Gateway. There are opportunities to further consider a city-region focus to some of these activities where local area approaches appear very similar. This would bring potential benefits of scale and opportunities for businesses to network at a wider level. A key message from Greater Manchester is that events of this nature have proved popular with the business community.

Development and promotion of an enterprise asset map/directory

This links to but is different to point 1. Across the city-region it is very apparent that there is a vast range of physical and intellectual assets that support enterprise related developments. These include enterprise hubs, incubators, innovation centres, self-employment hubs etc. There are also good examples of integrated delivery hubs. But again these are not collated, promoted and marketed as city-region resources. Comprehensively pulling together these resources into a single accessible portal, and maintaining this would signal a stronger and integrated city-region enterprise message. Invest in Glasgow has some very useful publications in this respect which will be useful starting points. A fall out from these developments is also likely to be more consideration on how these facilities network and cross refer to support individual enterprise journeys.

A region wide business development initiative to engage and connect further with resources and activities in the HE/FE sector

Service mapping returns highlight a wide range of enterprise resources within the city- region’s vibrant HE and FE sectors. Many individual examples of partnership work across agencies are in place, but these appear random and inconsistent. There is much more potential to utilise these resources to mutual partner, and critically enterprise, advantage. In this context, it is suggested that a joint approach to the collective city-region HE/FE sector by the 8 local authorities may identify new opportunities, and provide a ‘scale’ of interest leading to new working protocols and opportunities. This work could also explore whether any baseline city-region data on ‘improved knowledge exchange from University research’

25

could be established. As noted in section 2.4, this is a key indicator within the ‘Scotland Can Do’ strategy which is only available from Universities themselves.

A Glasgow City Region information and intelligence Hub

This action area is suggested on the basis of the information and intelligence activities of local authorities and partners keeping pace with a full acceptance of the city-region agenda. This research and other studies have noted that the amount of available intelligence and data available and analysed at city-region level is limited4. It is also suggested as an area where the capacity of some individual local authorities is particularly stretched.

In the first instance, it is recommended that consideration is given to the potential for local authorities to further share their combined regional employment, enterprise and skills research and development capacity. This would allocate ‘city-region’ lead roles on the basis of ‘distributive leadership’ principles, and potentially lead to the secondment of key staff to a co-located Hub. In a second phase, this approach could be extended further to partner agencies. The example of New Economy in Manchester is of some interest here, though it is different in scale to anything that may be practical in Glasgow.

Combined sectoral initiatives

Local authority mapping returns indicate individual local authorities are supporting specific initiatives in the same economic sectors. This suggested action area is to review the synergy between these and ensure opportunities for joint promotion, delivery or learning are shared. It is an example of an area where some focus on ‘intra-region’ competition may lead to opportunities to secure gains for the city-region being missed. Tourism is an example of a relevant sector, and any developments here need to align to the lead tourism portfolio role allocated to the leader of Inverclyde Council.

IT/digital support initiatives

The rationale for this suggestion is broadly similar to that above on sectoral initiatives. An added consideration is that where support is delivered remotely the potential for combined city-region wide approaches may be stronger.

Moving forward

Progressing the issues on this list should form the basis of the early action plan for the cross authority team taking forward work on the enterprise portfolio. It should not be viewed as exclusive of any other areas of work identified through further assessment of the criteria suggested on page 24, and analysis of the service mapping messages. Aspects of this work clearly involve the engagement of key partners, but an important message is that these are all areas the local authorities can collectively advance themselves – demonstrating commitment and building momentum for wider partner involvement.

4 A related point here comes from the recently produced Scottish Alliance report ‘Empowering the Cities’. This reflected city local authority concerns that they often felt they did not have access to appropriate information on both the enterprise and skills agendas. Across the two potential phases of work suggested here, some progress on this issue may be possible.

26

An important point on the above list is that in some areas changes in approach may not be practical or assessed as bringing any added value. This should be considered an acceptable outcome: the key process point is that the question has been asked in the context of the city-region agenda - taking cognisance of the criteria detailed earlier on page 24.

Finally, it should be noted that the list above does not contain any specific recommendations for employability and skills interventions. These were not the focus of this research. But elsewhere, the report suggests that these agendas are closely linked, and that the overall City-Region Enterprise and Jobs Hub should include potential incorporation of these services. Identifying a similar list in these areas would be of value, and from there much of the development process is likely to be similar. An obvious example, which straddles all these agendas, is the opportunity and logic for a single city-region wide recruitment incentive/wage subsidy programme.

Delivery and resources

The suggested way forward is premised at this stage as having very minimal direct financial implications for partner authorities. The main resource demand initially will be the in-kind contribution of officer resources. These will be supplied through the wider ‘distributive leadership model’ agreed by the Cabinet on 7th June 2016 which is detailed further in section 8. These arrangements will continue the city-region lead role led by Councillor Mark MacMillan of Renfrewshire Council on behalf of all 8 local authorities.

In practical terms, the City Region Economic Sub Group will now be tasked with taking this forward by initially agreeing a future action plan based on the recommendations of this report, and then progressing this accordingly. The action plan should also identify where any additional financial resources may be required to support the implementation of new approaches, but in the current context these should be minimal and focused on specific developmental tasks and transitional issues such as future service delivery branding.

The time commitments involved in this work should not be underestimated, but they should be consistent with the overall priority all the local authorities have now signalled for a city- region approach. In addition, they should not be viewed as ‘additional’ commitments but rather part of the process of evolving existing service delivery mechanisms within a city- region context.

As wider relationships further develop, it is anticipated that relevant staff from partner agencies will also be invited to join the process of developing a Regional Enterprise and Jobs Hub.

Over time the regional approach should offer the scope for savings through economies of scale, but it suggested authorities should be cautious on the level that these are anticipated in the short term.

27

2.2 Fit with related developments

Recommendations and potential actions on the enterprise portfolio must fit alongside other related and ongoing City Deal developments.

The enterprise research was commissioned as the first of three related CD work-streams – with the others the development of the Regional Economic Development (RED) strategy and the Skills Strategy. But in practical order the RED strategy needs to be the overarching document from which action on the other two agendas should follow. So it is essential any work on enterprise anticipates and is consistent with the subsequent wider strategy.

Progress on the enterprise portfolio must also be consistent with city-region wide work on skills and employability. The logic of action in one area primarily follows into the other, and general policy trends have increasingly suggested we need to better join up primarily supply side interventions on skills and employability with the demand led nature of business and enterprise supports. In practice, action on enterprise, skills and employability are very closely related, and the City Deal will only achieve its headline targets through integrated action across both agendas. The recent Scottish Alliance reported referenced earlier reaches a similar conclusion, noting ‘…the issues identified around skills policy mirror similar attitudes around infrastructure and enterprise policy’.

Consequently, it is very likely that if CD authorities progress early work in enterprise, questions will be asked about how the employability/skills service delivery infrastructure is following suit.

In delivery terms it suggested that any new regional growth and jobs hub should ideally seek to incorporate services in both areas. In governance terms, it is likely that any city-region proposition to lead the ‘Regional Enterprise Partnership’ (REP) for the CD area would require to have - and be strengthened by - a cross enterprise/skills/employability perspective.

Two other related developments are central to the concept of the Regional Growth and Jobs Hub and are considered in subsequent sections.

Firstly, the worked up proposals for a new hub approach should be underpinned by a performance framework. An outline of key indicators is suggested in section 10, but additional employability/skills specific indicators need to be added to this.

Secondly, some suggested current weaknesses in city-region governance structures may require to be addressed to support the proposed regional hub concept, and any REP linked CD proposition. A wider range of partner agencies need to be engaged. This needs to be reflected at the economy sub group level, and probably at the CE group level. In addition, further progress in establishing the new private sector Regional Economy Forum will be helpful as private sector endorsement and input to shaping hub developments would be of value. Governance issues are now considered further in section 2.3.

28

2.3 Governance and partnership arrangements

The approach recommended in taking forward the City Deal’s enterprise portfolio demands and would be assisted by a number of key partnership and governance developments. These also have wider implications beyond the scope of this specific research.

Interim report observations and recent related developments

The interim report noted in reviewing current governance and partnership arrangements that:

• regionally and partnership focused mechanisms were limited – regional groupings primarily included solely local authority inputs, whilst relevant partnership arrangements were mainly based on individual local authority boundaries

• some previous regional partnership forums had to a degree stepped down activity in the expectation that City Deal structures would now assume this role

• privates sector input to City Deal governance is anticipated to be a new private sector led Regional Economy Forum, but this is not yet established

Since the interim report, the new Scottish Government’s commitment to develop Regional Economic Partnerships/Forums and the current review of enterprise agencies now bring a renewed scrutiny on city-region governance arrangements; and potentially new opportunities.

Suggested governance and partnership developments

Additional partnership and governance arrangements are now needed. Overall, these should be based on city-region structures evolving to be the natural mechanism to deliver the Scottish Government’s Regional Economic Partnership aspirations. This would avoid the potential duplication of two structures both focusing on growth and jobs at the regional level.

But this requires early action by the City Deal Cabinet to formally and fully engage key partners in city-region partnerships. As a minimum this should include: Scottish Enterprise; the Scottish Funding Council; Transport Scotland; SPT; Skills Development Scotland; the Department of Work and Pensions; and when appropriate the Scottish Government. Engagement should be at three levels:

• between the political leadership of the City Deal Cabinet and Scottish and (potentially) UK Government ministers

• at senior officer level between the City Deal Chief Executives group and the Chief Executives/lead officers of the partner agencies detailed above

29

• at operational strategic management level between the current City Deal Economy sub group and equivalent staff in partner agencies

Complementing these developments, the City Deal Cabinet should continue to advance and support the critical work of the private sector Regional Economy Forum (led by Lord Haughey) to ensure that the Scottish Government’s intention to ensure meaningful business input to Regional Economic Partnerships is addressed within city-region structures.

A number of consequences lead from these developments:

• they reinforce the need to fully connect the enterprise, skills and employability agendas

• they have the potential to replace existing mechanisms including aspects of the Clyde Valley Community Planning Partnership, and the Scottish Enterprise initiated West Regional Advisory Board. But this needs to be agreed between partners

• further consideration is required on the degree to which these arrangements may in part replace some existing local arrangements based on local authority focused Community Planning Partnerships. This needs to review any statutory implications of this, and embrace non local authority partner views on the advantages and drawbacks of moving to a more city-region level focus

City Region Distributive Leadership model

At its meeting on 7th June 2016, the City Deal Cabinet agreed to move forward its future ambitions by adopting a ‘distributive leadership’ model. In summary, this has allocated 8 leadership briefs across the 8 local authority leaders. Each leader will now oversee a process to initially produce a portfolio action plan by September 2016.

The leaders will now speak on behalf of the whole city region on their allocated area of responsibility, and have access to relevant support resources across all the authorities. Over time, the portfolios also aspire to engage specialist support and inputs from partner agencies.

The new partnership arrangements detailed above will cut across a number of the portfolios, and it will be important that the Cabinet assigns relevant inputs to appropriate meetings and mechanisms.

30

2.4 Performance Indicators

Reviewing and identifying ways that the City Deal’s enterprise agenda can evolve demands consideration of how future progress or ‘success’ would be evidenced. Any future changes and alterations in support can only be justified by measurable and evidenced improvements in performance. Consequently, the research sought to identify the key performance indicators that would signal a successful response to the enterprise agenda for the City Deal.

Since this work was commissioned, the City Deal has commissioned a Regional Economic Development strategy that will include a full baseline of performance related indicators. Enterprise specific supports need to sit as a subset within this, though they are not always easy to precisely disaggregate.

SLAED indicators and Scottish Enterprise KPIs

A main source of information on enterprise performance is the Scottish Local Authority Economic Development (SLAED) indicators developed and annually compiled by the Improvement Service. These are based on the composition of a number of supporting data sources: NOMIS; Business Gateway; Scottish Enterprise; and the Supplier Development Programme.

These indicators are wider than solely the enterprise agenda, and it is suggested the relevant measures in this context are5:

Activity indicators

• number of attendees at Business Gateway events • number of companies registered with the Supplier Development Programme

Output indicators

• number of businesses supported by Council economic development activity • number of unique businesses that have received an intervention of support from the Business Gateway • number of companies assisted by Scottish Development International • availability of employment land • number of businesses participating in the Supplier Development Programme

Outcome Indicators

• gross value added • new business starts • business survival rates • town vacancy rates • number of business gateway start-ups that are trading

5 The indicators edited out of this list from the full SLAED framework are primarily related to employment and employability.

31

• Business Gateway survival rate

Given the comprehensive way the Improvement Service compiled these indicators, the list above includes many of the key measures that the City Deal is anticipated to use in terms of measuring progress on the enterprise agenda. To complement this, it suggested that the SLAED data is augmented by the KPIs of Scottish Enterprise. These are available at the city- region level, and include:

• number of account managed companies (AMCs) • numbers of AMCs currently in the Business Gateway pipeline • SE growth prospect companies • RSA – offers made; value of offers made; jobs created; jobs safeguarded • Scottish Investment Bank - total number of investments; total value of investments • Inputs the findings of this report to the current Scottish wide review of enterprise agencies. • Requests that the area covered by the proposed Regional Economic Partnership is coterminous with Glasgow City Deal boundaries, and that based on the actions above, this new function is incorporated within new City Deal governance arrangements. • companies assisted by SDI • confirmed inward investments • planned new jobs • planned safeguarded jobs • planned high value jobs • R&D grants • innovation support grants • SMART - R&D grants; manufacturing reviews • completed projects • number of projects supported by Co-operative Development International

For most indicators, comparative data on both of the above sets of data can only be provided within Scotland, and against overall national performance. They primarily relate to specific local or Scottish level interventions. The only exception where comparators from elsewhere in the UK may apply are the SLAED outcome indicators on: gross value added; new business starts; business survival rates; and town vacancy rates

Other indicators

In reviewing other related strategies, a small number of additional indicators are also suggested as of relevance:

The Government Economic Strategy includes within its KPIs:

• productivity growth • inclusive growth • business innovation rates

32

Data on the former two of these is available at city-region level, but it is not clear at this stage on the geographic level of breakdown on business innovation rates.

‘Scotland Can Do’ identifies two other specific National Indicators to measure performance towards becoming a world-leading entrepreneurial and innovative nation:

• increased research and development spending • improved knowledge exchange from University research

Data on the former is now available at city-region level, the latter would require further work directly with Universities.

The Regional Economic Development strategy is now identifying a much wider set of relevant baseline data. This has more potential to establish comparative elements within Scotland, and with other equivalent cities in the UK. Opportunities for any further direct comparator work on the enterprise specific indicators may become apparent when this is completed.

33

2.5 Practical considerations and timescales

Practical considerations

In suggesting practical actions on the City Deal’s enterprise portfolio this report has sought throughout to balance ambition with realism. On one hand, there would appear to be a clear aspiration amongst the local authorities for change, and a willingness to consider new city-region focused approaches.

But equally, we are aware that working in this way is in many ways new territory, and that some previously similar initiatives to move forward have in practice suffered due to over ambition. In addition, consultees in the area from which most practical learning has been transferred – Greater Manchester – have emphasised the extended period of development and ‘cultural change’ that led to current arrangements.

In addition, full realisation of the aspiration to move towards a Regional Enterprise and Jobs Hub requires buy in and endorsement from a range of other partners. Whilst there are some indications from wider developments that suggest some positive scope for progress, these are neither clear not guaranteed at this stage. Helpfully, however, they are now anticipated to advance quickly over the coming months.

As a consequence, the City Deal Cabinet needs to consider the how as well as the what and why of moving forward.

Some practical suggestions in the approach are to:

• take a gradualist based approach using early wins and progress to build further momentum

• share the workload and ensuring maintained momentum through cross authority task groups/centres of excellence linked to the distributive leadership model

• consider full or part time staff secondment options

• based on progress, identify processes to engage the developmental resources of key partners (again with secondment options)

Linked to this, it suggested that in terms of the order of developments, progress is maintained through a sequence of

1. Immediate things that the City Deal authorities can now advance – which includes progress on all the suggested early action areas detailed in section 2.1.

2. Using this early work as a platform to engage partners – seeking to add their contributions, resources, and services to the scope and potential of the Regional Hub and Regional Enterprise Partnership.

34

3. Further progress based on experience and development, and opportunities emerging from the ambition of the wider regional economic development strategy.

Timescales

The City Deal Cabinet has indicated a wish to move forward developments on the Enterprise portfolio - alongside the other 7 leadership portfolios now agreed - with considerable urgency. This is to ensure the views and suggestions of the Cabinet feed into, inform and gain from other related developments now moving forward quickly – most notably the review of enterprise agencies, and anticipated announcements on Regional Economic Partnerships. In addition, concerns expressed in the recent Scottish Cities Alliance that Scottish cities are falling behind their English counterparts in terms of economic performance is viewed as demanding early and ambitious action.

Consequently, a full action plan with associated delivery arrangements to move forward the recommendations in this report is required by October 2016.

35

2.6 Suggested Next Steps

Based on acceptance of this report, it is now suggested that the City Deal Cabinet:

1. Refers this report for action to the City Deal Economy sub group.

2. Requests a full action plan based on the indicative early action areas detailed in section 2.1.

3. Implements the governance changes suggested in section 2.3, including the full engagement of key partner agencies, and continued support to the development of the private sector led Regional Economy Forum.

4. Inputs the findings of this report to the current Scottish wide review of enterprise agencies.

5. Requests that the area covered by the proposed Regional Economic Partnership is coterminous with Glasgow City Deal boundaries, and that based on the actions above, this new function is incorporated within new City Deal governance arrangements.

6. Ensures this report’s findings are consistent with, support, and are supported by, the finalisation of the City Region Economic Development and Skills strategies.

36

APPENDIX 1 – ENTERPRISE SERVICE MAP

The research process involves the mapping of relevant partnership interventions which support the enterprise agenda. This has sought to capture the following information by each service:

• nature of service • geographic reach • eligibility criteria • scale of activity (annual budget; businesses supported grants distributed etc in City Deal region)

The key types of interventions, eligibility criteria and geographic reach of supports by agency or agency groupings are summarised. Categories are as follows:

• Local authorities

• Key national delivery agencies

• Higher and Further Education institutions

• Third sector organisations

• Employer intermediary organisations

• Procurement focused interventions

• Miscellaneous

A recurrent problem in analysing the mapping returns is the distinction between agencies that fund services, and delivery agencies. This leads to some potential duplication in presentation. Where possible, this report seeks to focus on who actually delivers the service, but realistically at this stage there will still be some overlap.

A full report on returns from the mapping survey has been prepared for the City Deal Economy sub group as a separate document to support further developments.

37

Local Authorities

Services

All 8 local authorities deliver some enterprise related services, and this includes delivery of the Business Gateway6.

The exact mix of services varies, but a core range of functions are apparent in the mapping returns received from all 8 City Deal authorities:

• Business start-up support (Business Gateway) • Business growth support (Business Gateway) • Business Gateway enterprise advice, skills and training workshops • Provision of new business start-up grants • Property advice and grants • Micro business growth funds • Specific developmental grants • Specific sectoral support initiatives • Social economy development support • Business support premises and sites • Business Directories

A range of other services are more specific to one or a smaller number of local authorities. These include:

• Specific links with Universities and Colleges/Knowledge Transfer Hubs • Business Improvement Districts and other Town Centre focused initiatives • Globalisation support • Rent and rate rebate schemes • Vacancy management • Business incubators • Procurement initiatives (additional to standard Supplier Development support – see below) • Youth enterprise focused activities • Digital boost workshops • Graduate intern schemes and wage subsidies and incentives • Supply chain and procurement support schemes

Eligibility/targeting

• Local authority services are all focused on the individual Council boundaries. • There are a handful of smaller interventions which are only provided by a few of the 8 included local authorities which sees eligibility cross council boundaries such as the LEADER programme which is available to businesses in Renfrewshire, East Renfrewshire and Inverclyde.

6 The Business Gateway is currently delivered by a mixture of in-house and out sourced mechanisms across the City Deal authorities.

38

• Business Gateway and many other services are targeted at start up and smaller companies. Other services are available to any business, whilst a number are sector specific based on local priorities and opportunities.

39

Key national delivery agencies

The 2 key national agencies relevant to the enterprise agenda are Scottish Enterprise and Skills Development Scotland.

Scottish Enterprise

Services and targeting

Service/support Eligibility/targeting General account management support Options include: opening up companies to a range of • Companies deemed particularly individual SE supports important to the economy • Early stage and start-up companies demonstrating significant growth potential • Account managed growth – minimum additional of £1 million turnover in three years and operating in one of SE’s key sectors • Potential growth companies in the Business Gateway pipeline • Growth prospect companies – anticipated to move to full account management in 12 months Regional Selective Assistance grants • Discretionary grant to support investment and job creation in Assisted Areas with number of support criteria requirements • Also some support to SMEs in non- Assisted Areas Scottish Development International support • Scottish companies looking to internationalise Scottish Investment Bank • High growth companies focused on SE priority sectors Research and Development grants • Businesses (irrespective of size) wishing to grow through the development of new products, processes or services Innovation Support Grants • Growth companies undertaking innovative development and not supported by stricter R&D definitions Smart R&D grants • Mainly for SMEs to research, develop and exploit new technically innovative products and processes. Scottish Manufacturing Advisory service • All manufacturing companies throughout Scotland – can include depth consultancy support

40

Co-operative development • Businesses looking to establish consortia or explore employee ownership options

Skills Development Scotland (SDS)

SDS’s main focus in terms of supporting enterprise is on skills development – primarily through the national MA programme. Other relevant interventions identified are the Skills for Growth programme, the Our Skillsforce website, and the Third Sector Employability Fund.

41

Higher and Further Education Institutions

The City Deal area contains 6 Higher Education Institutions and 6 FE Colleges. 5 Universities and 4 FE Colleges have submitted service mapping returns to date.

Higher Education

5 Universities have completed mapping returns – Glasgow University, Glasgow Caledonian University, University of the West of Scotland, Strathclyde University, and Glasgow School of Art. These reflect a mix of specific initiatives, alongside services common to all including:

Services

• Business incubators and start up facilities • Innovation Centres • Business support advice – linked to specific staff expertise • Investment funds for patents • Enterprise support to current students and alumni • Access to Venture capital • Entrepreneurial Centres of Excellence • Access to specific University facilities • Commercial investment support (often to companies with University part ownership) • Applied research programmes • Globalisation support • Knowledge Transfer Partnerships • Access to offices out-with Scotland

Eligibility/targeting

Many University services are available to businesses across Scotland (and sometimes beyond). Others are specifically focused on small, start up and growth companies. A small number of supports are primarily for current students and alumni.

FE Colleges

4 FE Colleges have completed the survey to date: Glasgow Clyde College, West College Scotland; New College Lanarkshire; and South Lanarkshire College. Services identified suggest a fairy consistent set of activities:

Services

• Enterprise and business skills training • Start-up business support and signposting to other services such as the Business Gateway and the Prince’s Trust • Support to academic research and business links • Knowledge Transfer Partnerships • Access to College facilities, premises and IT capacity

42

• Specific enterprise activities linked to courses – employer inputs, enterprise ‘showcasing events’, enterprise related challenges etc

Eligibility/targeting

Most services are available to all businesses – though with an emphasis on start-up and early business growth activity. Others are specifically to support College students.

43

Employer intermediary organsiations

The mapping study has captured the enterprise activities of 2 major Chambers of Commerce and the Federation of Small Businesses. The Scottish CBI were invited to indicate any relevant work, but decided not to submit an entry.

Glasgow Chamber of Commerce

Glasgow Chamber provides a range of services to member companies and some services to all businesses – these are primarily based in Glasgow but any business is eligible to join. Services include: business and networking events; a menu of training and workforce development activities; international trade support; affinity/business discount schemes; member marketing and profiling; support to young entrepreneurs; online SME information and advice to SMEs; peer to peer funding support; the green business network.

Renfrewshire Chamber of Commerce

Renfrewshire Chamber provides a range of services to member companies – these are primarily based in Renfrewshire but any business is eligible to join. Services include: business mentoring; export documentation; ongoing networking; and networking events.

Federation of Small Businesses

The FSB provides support to small businesses from sole traders to companies with up to 250 employees across Scotland. Services are available to members and include: legal and tax advice; access to model and legal documents; employment advice and insurance; financial health checks; business continuity support; and health and safety advice and training.

44

Third sector organisations

Mapping returns have been completed by 5 third sector organisations.

The Prince’s Trust Scotland

The Prince’s Trust offer a comprehensive range of enterprise support including intensive and tailored support around the 4 key elements of: Inspire, Explore, Launch and Boost.

Young people aged 18-30 who are unemployed or working under 16 hours per week are eligible for support. This support is offered across Scotland, but with a regional support structure for the City Deal area.

CEiS

CEiS provide a range of support services to enterprising third sector organisations across Scotland. This incorporates assistance from the social enterprise support programme ‘Just Enterprise’.

Available assistance includes: business planning for growth; business recovery services; feasibility studies; enterprise training; social investment readiness support; Community Asset Transfer advice; contract tendering support; marketing and e-commerce advice; legal and governance services; internationalisation support; social investment loans (via DSL); evaluations and social audit support.

Entrepreneurial Spark

ES seeks to encourage ‘entrepreneuring’ though the development of entrepreneurial mind- sets and behaviours. Is does this through a UK wide network of business accelerator incubators providing intensive support to early stage and growing ventures. One incubator is located in central Glasgow, and whilst businesses from anywhere can seek support, in practice most are likely to be from the city-region area.

Lanarkshire Enterprise Services (LES)

LES is an Enterprise Trust that currently delivers the range of Business Gateway services (listed above) in Lanarkshire and Renfrewshire. Other services include: the Smart Accelerator Programme for small businesses with significant scale-able growth (Lanarkshire only); provision of business incubation space for small early stage companies (Lanarkshire only); operation of the Alba Innovation service for early stage technology starts with significant growth potential; operation of Hillington Park Innovation Centre; a range of support to academic research and business links; social enterprise support services; operation of the ‘Enterprise Challenge’ aimed at business start-ups and young businesses.

45

Engage Renfrewshire

Engage Renfrewshire provide a range of enterprise related supports to voluntary sector member organisations in Renfrewshire. This includes: social enterprise support; payroll services; business plan development workshops; support to accessing external funding; accommodation in the ER Hub; and other general support.

46

Procurement focused interventions

Two procurement focused interventions support the enterprise agenda within the City Deal.

Supplier Development Programme

The Supplier Development Programme is a shared service which currently has 31 of Scotland’s 32 local authorities in membership. It provides a range of services targeted at SMEs and social enterprises to improve their capacity to understand and tender successfully for public sector contracts. This includes a range of advice mechanisms and events customised to individual business expectations and starting points. Support is available to all businesses in Scotland through free SDP membership.

Scotland Excel

Scotland Excel is a shared service between Scotland’s 32 local authorities. It is an established Centre of Excellence which seeks to increase efficiency and value for money in public sector procurement in Scotland through combining purchasing power. Contracts issued by Scotland Excel are very important to a large number of enterprises in the City Deal area and beyond.

47

Miscellaneous

This includes a number of unconnected services which do not neatly fit in any split of earlier categories. These interventions are diverse in nature, and are not grouped together for any other reason.

Clyde Gateway Urban Regeneration Company7

Clyde Gateway is an established URC which provides support to a conterminous group of deprived communities in the east end of Glasgow and in parts of Rutherglen in South Lanarkshire. Enterprise services include: provision of business premises and infrastructure; support to academic-business links via an ‘enterprise clinic’ (with Strathclyde University); general business support services; commercial grants and business incentives; enterprise and business skills training in schools.

Jobs and Business Glasgow

JBG is an ALEO of Glasgow City Council. It provides a range of services to businesses and social enterprises in Glasgow including: business start-up and aftercare support to residents of disadvantaged communities or groups; the Youth Enterprise Zone targeted at 16-25 year olds interested in self-employment or business start-up; 1-2-1 support to social enterprise organisations and third sector organisations with enterprise aspirations; case management support to organisations considering asset transfer options from the local authority; HR support to micro businesses.

West of Scotland Loan Fund (WOSLF)

The WOSLF provides loans of up to £100,000 across the City Deal area at competitive rates. SMEs, new businesses, growing businesses, start-ups, expansions, and growth companies are eligible for support. The fund can also be used to safeguard jobs.

7 The work of the other URC in the City Deal area – Riverside Inverclyde – is incorporated in the Inverclyde Council return.

48

APPENDIX 2 – CONSULTEES8

Local authority leaders/elected members

Councillor Mark Macmillan – Renfrewshire Council (City Deal Enterprise lead) Councillor Jim Fletcher – East Renfrewshire Council Councillor Rhonnda Geekie – East Dunbartonshire Council Councillor Jim Logue – North Lanarkshire Council Councillor Frank McAveety – Glasgow City Council Councillor Eddy McAvoy – South Lanarkshire Council Councillor Stephen McCabe – Inverclyde Council Councillor Martin Rooney – West Dunbartonshire Council Councillor Chris Thompson – South Lanarkshire Council

Local Authority – officers

Sandra Black – Renfrewshire Council Richard Brown – Glasgow City Council Andy Cahill - East Renfrewshire Council Ruth Cooper – Renfrewshire Council Douglas Duff – Falkirk Council/Business Gateway National Management Group Aubrey Fawcett – Inverclyde Council Lindsay Freeland – South Lanarkshire Council Thomas Glen – East Dunbartonshire Council Jacqui Hill – Glasgow City Council Steve Keating – South Lanarkshire Council Shirley Linton – North Lanarkshire Council Iain MacLean – East Renfrewshire Council Michael McGlynn – South Lanarkshire Council Michael McGuinness – West Dunbartonshire Council Lorraine MacMillan – East Renfrewshire Council Mike McNally – Glasgow City Council Alasdair Morrison – Renfrewshire Council Yvonne Rogers – South Lanarkshire Council Kevin Rush – Glasgow City Council Colette Saez – Renfrewshire Council Graeme Smith - Glasgow City Council Alan Vesey – Glasgow City Council/PMU Glasgow City Deal Joyce White – West Dunbartonshire Council

Wider stakeholders

Gillian Cameron – Supplier Development Programme Bod Davidson – Renfrewshire Chamber of Commerce Andrew Dickson – West of Scotland Loan Fund Calum Graham – Jobs and Business Glasgow Lord Willie Haughey – Glasgow Economic Leadership Board Karen Jackson – Scottish Government Lesley Jackson – Scottish Enterprise

8 These are the consultees for both stages of the research process. A number of people were consulted twice.

49

Hishashi Kuboyama – Federation of Small Businesses Paul Lewis – Scottish Enterprise Karen McAvenue – Scottish Government Andrew McGuire – Improvement Service Gerard McLeave – Metrodynamics Robert McMillan – New College Lanarkshire Alan McNiven – Engage Renfrewshire Ian Manson – Clyde Gateway URC Ross Martin – SCDI Johnny Mone – University of the West of Scotland Stuart Patrick – Glasgow Chamber of Commerce Kenny Richmond – Scottish Enterprise Henry Rigg – Leeds City Region Local Enterprise Partnership Clare Sowney – Prince’s Trust Niki Spence – Clyde Gateway URC Paul Watson – New College Lanarkshire Morag Watt – Scottish Government Julie Welsh – Scotland Excel Paul Zealey – Skills Development Scotland

50