GREATER BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD MEETING Thursday 10th June LEP Board Meeting – 09:00-12:00
Video Conference using Zoom Software Solution
AGENDA
Item Time Owner Subject Pre Read Presenter Purpose of the Report
1 09:00 Chair Welcome and Verbal Tim Pile To note attendance and apologies Introductions
2 09:02 LEP Executive Notes / Matters Arising Attached Tim Pile To agree notes of the last meetings and any from April 22 2021 matters arising
3 09:05 LEP Executive Chief Executive’s Report Attached Ed Watson To raise and discuss headline business on the agenda, and to note performance against KPIs.
4 09:20 LEP Executive Route to Recovery Attached Ed Watson To consider various aspects of the route to recovery in the GBSLEP area, receive an update from the Recovery Taskforce and agree actions as appropriate.
5 09:30 LEP Executive LEP Review Attached Ed Watson To provide an update on the progress of the LEP Review and potential implications for the LEP activities
6 09:50 LEP Executive Supporting Young Attached Henriette Breukelaar Update on the actions undertaken since the People presentation by the YCA at the March Board and the follow-on Item on Economic Impact of Covid 19 on Young People in the GBSLEP area, including the setting up of a Task and Finish Group.
Item Time Owner Subject Pre Read Presenter Purpose of the Report
7 10:10 LEP Executive Delivery Plan Quarterly Attached Henriette Breukelaar To receive the quarterly report in respect of the and Full Year Report Delivery Plan for Quarter 4 and in respect of the Full Year
10:30 Break
8 10:40 LEP Executive Finance Scenarios Attached Kate Shaw To seek agreement to the adoption of the GBSLEP Finance scenarios discussed and recommended at the Finance Sub-Group
9 10:50 LEP Executive Impact Assessment, Attached Ed Watson In two parts: Evaluation and Customer Feedback Mike Folkard Item 9a) Discussion of proposed approach to evaluation of GBSLEP investments and activity
Item 9b) Update on the Results of the Final Evaluation of the Innovation Pilot. Review.
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Item Time Owner Subject Pre Read Presenter Purpose of the Report
10 11:05 Programme EZ Update Attached Christian Cadwallader In four parts: Delivery Board Item 10 a) To update on the Enterprise Zone Financial and Output Position at End of Quarter 4.
Item 10 b) To receive a summary of the key elements of the PWC reports in respect of the initial 2 phases of the Paradise Project.
Item 10c) To receive an update on the evaluation of the Interim Business Case and the development funding to support the production of the Final Business Case for Paradise Phase III.
Item 10d)To receive an update on the development of the EZIP Pipeline.
11 11:20 Programme Growth Programme Attached Kerry Billington Financial and Output Position at End of Quarter Delivery Board Update 4, for Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
Government updates regarding Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
12 11:30 LEP Executive Plan 10,000+ Attached Spencer Wilson Update on the overall progress of Plan 10,000+ / Employment Update/Work Academies with a focus on the Work Academies and capital and Skills pipeline element Board
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Item Time Owner Subject Pre Read Presenter Purpose of the Report
13 11:40 Programme Project Review – Grand Attached Kerry Billington Update on the Grand Hotel Project as it reopens Delivery Board Hotel to the Public and reaches the Evaluation Milestone
14 11:50 Any Other Business
Items for Noting and Management by Written Procedure
WP1 LEP Board Review of Agreed Attached Tim Pile To note progress against agreed actions. Actions
WP2 LEP Executive Forward Plan Attached Tim Pile To agree/inform on Forward Plan, including rescheduling of postponed items.
WP3 LEP Executive Communications Update Attached Satnam Rana- To receive an update on the LEP’s Grindley communications activities.
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GREATERU BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD MEETING
Thursday 22nd April 2021
MEETINGU BY VIDEO CONFERENCE
Present In Attendance Apologies
Tim Pile Chair Ed Watson LEP Executive Sophie Drake Story Comms Mike Lyons HS2 Ltd Kate Shaw LEP Executive Mike Steventon Formerly KPMG Chris Oates Deloitte Kerry Billington LEP Executive Ewa Truchanowicz Dignio Ltd David Hardman Bruntwood SciTech Christian LEP Executive Cllr Ian Ward Birmingham CC Cadwallader Anita Bhalla Performance Birmingham Satnam Rana- LEP Executive Cllr Karen May Bromsgrove DC Grindley Louise Brooke-Smith Consilio Cllr George Adamson Cannock Chase DC Ian Tandy HSBC Helen Harper LEP Executive Cllr Ian Courts Solihull MBC Philip Plowden Birmingham City University Josh Tate LEP Executive Dawn Ward Burton & SD College Edward Scutt LEP Executive Cllr Brigid Jones Birmingham CC Michelle Nutt Cities and Local Growth Unit Cllr Iain Eadie Lichfield DC (Observer) Simon Garrad Birmingham CC Cllr George Allen East Staffordshire BC Cllr Matt Dormer Redditch BC Cllr Jeremy Oates Tamworth BC Alison Jarrett Section 151 Officer
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Item Item Subject Decision / Notes Action Timescale Owner Number
1 Welcome and The Chair welcomed Members to the meeting, Introductions noting apologies as above.
The Chair welcomed Philip Plowden of Birmingham City University, who was attending his first Board Meeting. The Chair confirmed that Philip Plowden was also going to chair the Business and Innovation Pillar Board.
The meeting also noted that certain Board Members would not be able to attend the full duration of the Board Meeting.
2 Notes / Matters Arising The notes of the GBSLEP Board Meeting held from 25th March 2021 on 25 March 2021 were read and agreed as a correct record.
The Chair reminded the Directors of the need Volunteers to communicate ASAP Chief Executive/Board for Volunteers for a Champion for the Low with the Chief Executive if Directors Carbon Sector and as Members of a Task and interested. Finish Group for the Young People.
3 Chief Executive’s Board Directors noted and commented upon Report recent developments.
Board Directors asked about the availability of LEP Executive to investigate ASAP Chief Executive / Data on Companies suffering a material Debt the availability of data and to Policy Teams Burden materially affecting the ability to grow communicate back to the (often described as Zombie Companies). Board, 2
Item Item Subject Decision / Notes Action Timescale Owner Number
Philip Plowman (Vice Chancellor BCU) asked if Chief Executive and Head of ASAP Chief Executive / the LEP would support am initiative it was Skills to review proposal and Head of Skills bringing forward for a Graduate Kickstart to determine what support Scheme. A one page summary was to be GBSLEP could give. shared with the Chief Executive.
4 Route to Recovery Board Directors: 1. Noted the current local, regional and national context. 2. Noted and commented upon developments in relation to the GBSLEP’s current suite of interventions and plans to support businesses
Cllr Brigid Jones asked if the LEP could aid communication of the EU Settlement Scheme, Growth Hub Director to ASAP Growth Hub Director with the deadline approaching on the 30th June review options for 2021 through the Growth Hub and in dialogue communication. with the Chamber of Commerce.
5 LEP Review Board Directors: 1. Noted and commented on the Terms of Reference for the review.
2. Commented on the proposed approach to responding to the review.
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Item Item Subject Decision / Notes Action Timescale Owner Number
3. Agreed to delegate final sign-off of the GBSLEP response to the Chair in discussion with the Chief Executive.
In relation to this delegation Board Directors Board Directors /
were asked to express a willingness to support Board Directors to Chief Executive Chair and CEO to assist in quick turnaround of communicate with Chief ASAP views Executive.
The Chair and Chief Executive gave a Chair / Chief Commitment to keep the Board informed as Communication to Board As Executive LEP Review discussions progress. Directors appropriate
In the discussion Board Directors made a number of specific requests:
Review expertise retention in Programme Area Chief Executive Chief Executive to review ASAP
options. Review enhancing other mechanisms such as
EZ when faced with a lack of capital investment Paper being drafted for PDB, Programme Team funding from Central Government Sources with aim of being presented June Board to June Board. Preparation of Alternative approaches in Chief Executive relation to Economic Geography methodologies Chief Executive to review As (enhanced adoption of SED position and model options. appropriate being one option)
Head of Increasing engagement with SMEs, getting message across that they do have a voice Communications and Communications / Growth Hub team to ASAP Director Growth Hub investigate options 4
Item Item Subject Decision / Notes Action Timescale Owner Number
Increase engagement/dialogue with NHS in GBSLEP area, including involvement in LEP Chief Executive to review As Chief Executive Boards and Groups options. appropriate
Communication of achievements enhanced in Head of view of ability to influence current policy Communications Team to decision being reflected on LEP Review TOR. ASAP Communications investigate options.
Making case for retention of those elements Director of Economic viewed as vital - Place put forward as example Director of Economic ASAP Strategy
Strategy to review
Work at a Regional level with the Business Representative Organisations and undertaking Growth Hub Director and Growth Hub Director greater communication to get to a common Head of Business & ASAP and Head of Business position on the desires and needs of SMEs. Innovation to determine & Innovation appropriate actions.
Determining options for gaining additional
feedback from SMEs through Growth Hub Growth Hub Director to Growth Hub Director investigate options. ASAP Place & Programme Increased engagement with Business Place and Programme Teams Improvement Districts (as vehicle to talk to ASAP Teams to investigate SMEs and on our Boards) options.
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Item Item Subject Decision / Notes Action Timescale Owner Number
Scenario Planning – use of remaining capital Chief Operating Chief Operating Officer to funding to greater effect - confirmation of June Board Officer position to Board, following meeting of the Update Board Finance Group.
6 Finance – Budget Board Directors considered and agreed the Approval Outline Budget 2021/22.
7 Communications Board Directors: Update st of 1. Noted media activity highlights from the 1 st March until 31 March 2021.
2. Noted stakeholder engagement activities with GBSLEP public, private and academic sector partners. 3. Noted communications metrics for GBSLEP Channels and how they are being used to measure success and shape communications.
4. Noted that year on year there has been a
significant increase in awareness of LEP
activities through digital platforms.
A request was made for Board Directors to Board Directors to assist in As Board Directors engage and assist in the Communications Social Media platform based appropriate process on social Media platforms. communications
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Item Item Subject Decision / Notes Action Timescale Owner Number
The Head of Communications committed to Head of Communication to When Head of share the communication plan for the Delivery share when available. available Communications Plan once this was developed. It was noted that
an internal delivery plan for what was expected to be an 8 page document had been set for Mid May.
8 EZ Update Board Directors: 1. Noted the Enterprise Zone Programme Project Updates; and 2. Noted the Enterprise Zone Capital Programme Financial Update.
9 Investment Decision Board Directors approved the conditional allocation of £4,238,710 (four million two hundred thirty-eight thousand seven hundred and ten pounds) of Enterprise Zone Funding (EZF) capital grant towards the delivery of the Birmingham Smithfield Communication of decision ASAP Programme Team Enabling Works. to Project Sponsor
(This was in accordance with the Greater Birmingham and Solihull LEP (GBSLEP) Assurance Framework following the submission of an Outline Business Case (OBC) and the Independent Technical Evaluation (ITE) received on 29 March 2021 and approval by Programme Delivery Board on 31 March 2021).
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Item Item Subject Decision / Notes Action Timescale Owner Number
10 Growth Programme Board Directors: Update 1. Noted the Local Growth Fund (LGF) spend to date and progress of the quarter four forecast to achieve the full year 2020/21 outturn and completion of the programme by 31 March 2021; 2. Noted the £21.851m LGF (Department for Transport returned funding) spend to date and the progress made to contract and utilise the grant funding by 31 March 2021, with £3.556m approved to carry forward to 30 June 2021; and 3. Noted the Getting Building Fund (GBF) progress to date against the GBSLEP allocation.
11 Project Review – Board Directors received a presentation on the Unlocking Stalled area of Unlocking Stalled Housing and the Housing successful outcomes achieved.
A question was asked as to who owned the factory on which Saxon Gate in Lichfield was built. Subsequent investigations have determined that this was IMI Norgren – a manufacturer of pneumatic products for industrial automation 12 Any Other Business The Chair drew the attention of Board Directors to the date of the next Board on June 10th. He explained his desire for this to be a physical meeting, but this would be dependant on a number of factors.
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Item Item Subject Decision / Notes Action Timescale Owner Number
The Chair asked Board Directors to Board Directors to share ASAP Chair / Chief communicate any strong views they hold on views Executive Physical, Hybrid or wholly Zoom based meetings.
Written Procedure Items
WP1 Review of Agreed Board Directors were asked to note progress Actions against agreed actions.
No issues were raised by Board Directors, so the progress review was taken as noted.
WP2 Forward Plan Board Directors were asked to agree the Forward Plan, including the rescheduling of previously postponed items.
No issues were raised by Board Directors, so the updated Forward Plan was taken as agreed.
FUTURE LEP BOARD MEETINGS
• Thursday 10Pth P June • Thursday 15Pth P July • Thursday 23Prd P September • Thursday 4Pth P November • Thursday 2Pnd P December
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Item 3
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021
Chief Executive’s Report
Recommendations
Board Directors are asked to: 1. Note and comment as appropriate on recent developments.
Strategic Issues
Key Performance Indicators – 24 May 2021
2. In the GBSLEP area the youth (ages 16-24) unemployment claimant rate remains continually high at 8.9%, a level that has been largely constant since May 2020. There was a small decrease of 150 claimants in April 2021, but the total remains high at 22,365. The GBSLEP region has 10,200 more youth claimants compared to March 2020.
3. In the GBSLEP area there were 112,855 claimants (aged 16+) in April 2021. There was a small decrease from the previous month of 1,010 claimants. However, the claimant rate remains at 7% which is the highest it has reached in the past 12 months. The GBSLEP region has 49,365 more claimants since March 2020.
4. The furlough scheme has supported 351,700 workers in the GBSLEP area at some point. Provisional data shows on the 31st March 2021 there were 115,800 workers furloughed in the GBSLEP area. Compared to 28th February 2021, there was a decrease of 10.6% (-13,800) while the UK decreased by 11.6%.
5. Despite continuing high unemployment levels, demand for labour shows continued improvement, with growth in the number of apprenticeship vacancies in April 2021 there were 1,223 apprenticeship vacancies. An increase of 82 from March 2021 and an increase of 336 when compared to from April 2020.
6. The latest data shows there were 82,987 unique jobs postings in April 2021. An increase of 1,594 from March 2021 and an increase of 16,228 when compared to April 2021.
7. The West Midlands Business Activity index increased from 60.7 in March 2021 to 65.9 in April 2021. This is the sharpest increase of business activity since record began in January 1997. The latest growth reported was associated to the ongoing easing of COVID-19 restrictions boosting the demand for goods and services.
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8. The West Midlands Future Activity Index increased from 80.2 in March 2021 to 80.8 in April 2021 – reaching the highest level since records began in mid-2012. The positive expectations for the upcoming twelve months are linked to the ongoing easing of COVID-19 restrictions, new work in the pipeline and diversification.
9. Please see Appendix A for the GBSLEP Economic Indicator Dashboard.
LEP Review
10. Item 5 on this agenda provides the latest update on the review.
Young People
11. An update on progress with this vital programme is provided at item 6 on the agenda.
Recovery Taskforce
12. The taskforce continues to meet monthly to drive GBS LEP activity in support of the post Covid Recovery and the new trading relationship with the European Union.
13. An update is covered in the Route to Recovery paper at item 4. The Board and Executive remain grateful to the taskforce members for their ongoing commitment, insight and invaluable contributions during this challenging period.
Operations Annual Performance Review (APR) 14. Following an internal moderation process LGIU has confirmed that GBSLEP had met all the requirements under all three criteria for the APR process.
Staffing 15. GBSLEP is playing its part in supporting the growth and development of young people in region through the creation of 12 new posts in two cohorts of 6 under the Kickstart Scheme.
Report by: Ed Watson Interim Chief Executive Officer
Contact: [email protected]
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Date Created: 25 May 2021
Appendix A GBS Economic Indicator Dashboard
Appendix A
GBSLEP Economic Dashboard to March 21
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GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021 Route to Recovery
Recommendations
Board Directors are asked to: 1. Note the current local, regional and national context. 2. Note and comment upon developments in relation to the GBSLEP’s current suite of interventions and plans to support businesses.
Background
3. GBS LEP acted swiftly to put in place a range of interventions to support businesses and individuals across the LEP’s geography through both the Covid 19 crisis and, since 1 January 2021, the new trading relationship with the European Union. 4. Governance for this activity has been through the Recovery Taskforce and regular reports to the GBSLEP Board. 5. This report provides an update on developments since the last Board meeting, including several matters that the Recovery Taskforce has considered. The agenda for the last taskforce meeting on 19 May 2021 in included at Appendix A. a) Local, region and national context 6. As part of the previous report on this agenda the Chief Executive has drawn the Board’s attention to the latest figures for economic performance across the region. Figures for worklessness remain high – especially so for young people and in some parts of the region in particular. Alongside this and on a positive note there are opportunities for employment as the economy opens up with the significant levels of vacancy in the night-time economy and hospitality industry more generally. 7. There are signals of confidence in the UK economic recovery in the figures for business start-ups and business confidence showing significant jumps. The West Midlands Business Activity Index (PMI) increased from 60.7 in March 2021 to 65.9 in April 2021, which is the sharpest increase of business activity since records began in Jan 1997. And the increase in the West Midlands was the highest of the 12 UK regions in April 2021. On a sector level the picture is much more mixed with some sectors showing real and sustainable growth and others like traditional retail continuing to struggle. 8. In terms of debt burden arising from Covid, a third of small businesses are still unaware of loan repayment options, even though first Bounce Back Loan repayments
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are due to start in June for many borrowers. Around a third of businesses plan to make the standard repayments. And just 5% intend to take the full six-month repayment holiday available. 9. In terms of health data, infection rates have been continuing to reduce nationally and regionally and at the time of writing the WM area had an average of 19.5 cases per 100,000 population. In relation to the vaccination roll-out those aged 38 to 40 are now being offered a jab and the vaccination rate in the West Midlands is above the average England rate. Across the West Midlands health authorities are closely monitoring the Indian variant which is leading to minor increases in infection rates in some areas – although numbers overall remain low.
b) GBSLEP interventions Growth Hub Activity Note: Data is from 1 April to 25 May 2021 unless otherwise stated.
1. Total no. of enquiries recorded since 1 October 2019, when GBSLEP took on direct responsibility for the management and delivery of the Growth Hub is 3,534.
2. After a strong March 2021, April dipped in terms of the no. of enquiries received but this was expected due to the effects of the Easter bank holidays. Also May’s figures quoted here do not reflect a full month.
3. Dec 2020 and Jan 2021 are still the strongest recent months but this can be explained by an uptick in enquiries as in the run-up to Brexit. This was exacerbated due to all the uncertainty and confusion about what was going to be finally agreed with the EU continuing until late December. There was then further confusion and disruption around trading post-Brexit, during January.
4. The number of enquiries has steadily reduced since January 2021 but a suggested above this is a result of receiving fewer enquiries regarding UK transition, as businesses adjusted to the new trading landscape and much of the Brexit ‘noise’ settled down. It therefore suggests that the number of enquiries received during Oct- Dec 2020 was exceptionally high due reflecting the fact that the environment in which the Growth Hub has been operating has been far from normal.
5. The average no. of enquiries received each month between Jan 2021 – May 2021 is 145 compared to an average of 42 during the same months in 2020. It is worth being reminded that March to May 2020 were in the middle of the first national lockdown at which point many businesses paused operations and therefore enquiries dropped significantly.
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% change from Count of Enquiries previous month 2021 Jan 193 -1.53% Feb 143 -25.91% Mar 162 13.29% Apr 112 -30.86% May 118 5.36% Grand Total 3534
Table 1: Overall Enquiry count Jan - May 21
High Intensity Medium Intensity Light Medium Intensity Support (12 hrs+) Support (3hrs+) Touch Support (Diagnostic) 2021 Jan 2 20 228 39 Feb 49 43 217 47 Mar 54 42 222 51 Apr 3 33 160 41 May 3 26 134 25 Grand Total 111 164 961 203
Table 2: detailed breakdown by type of support provided
6. In summary indications from the data are that business is returning to something approaching normal and that growth focused services are increasingly what businesses are looking for from the Hub.
COVID Response and Future Initiatives
7. The final few grants are being processed ahead of the project closure on 30 June.
SME Restart Grant
Applications received: 379 Grant offers made: 320 Grants paid out: 268 (£842,598.51)
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Skills Hub
8. The following is sets out activity across the skills hub between 1 April to 25 May 2021. There were:
• 86 Employer enquiries.
• 45 Training Needs Analyses (TNA’s) completed
o 30 TNA’s sent out for employer to complete/sign
o 15 TNA’s completed with local employers.
• 14 employers referred to Kickstart Gateway Organisations, of which: o 4 placements have been accepted by DWP and recruitment has begun. o 36 placements are pending approval by DWP. o Additional 53 placements in the pipeline to be referred to Kickstart Gateway Organisations
9. As well as this there were 7 employers referred to Apprenticeship Providers in relation to the provision of16 apprentice roles and 2 employers were referred to ESF- funded provision (SSW, SSP…etc.).
Peer Networks
10. The second round of Peer Networks is underway with six providers recruited (two first time) and a target of 18 cohorts of 11 businesses, 198 places available in total. Recruitment is more resource intensive due to businesses now being focused on delivery as the economy opens back. It is also suspected that most of the low hanging fruit were secured in the 1st round of activity earlier this year, Two cohorts will begin week commencing 7 June with a total of 40 companies already signed up. This programme has been particularly useful for business owners dealing with the challenges of Covid, Brexit and digital isolation.
Made Smarter
11. Following a successful pilot in the North West, the West Midlands six Hubs (again a regional collaboration) backed by the WM Combined Authority will be rolling out this programme for manufacturers based on Industry 4.0. It will be targeting 1,000 SMEs across the region with intensive support to streamline process and embrace new technologies. There is also a grant pot for around 25 SMEs for capital investment.
UK Transition
12. The regional collaboration with all six Growth Hubs underspent on the project budget to the end of March and has therefore rolled over the same level as support for companies for as long as there is funding. Therefore specialists, clinics and
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workshops are still available for businesses referred in by their local Hub team. Demand has steadily reduced over time but is still significant.
Business Support Provision in the West Midlands 13. The Business Support Review which has been commissioned by the GBS, Black Country, Coventry and Warwickshire LEP’s along with the CA continues to make positive progress. The latest position is set out in fig 1. There have been a number of engagement sessions with BRO’s, Business Support organisations, Universities, Growth Hubs etc during May to test out the emerging principles and direction of travel.
Fig 1: Business Support Review timeline
14. Key findings in relation to the current business support offer include the following: • Current programmes driven by public funding constraints (EU and UK monies): projects, programmes and supporting structures reflect the funding- led nature of provision, which complicates the delivery of integrated business support • Limited information sharing: Lots of intelligence but collected not used: and information on business base locally, particularly through Covid support, but hard to share or ”hand off” from one org to another. • Not genuinely customer-centric: Limited evidence of a 'business approach' to the customer journey, e.g. sales cycle or funnel, and instead reflects a public-sector philosophy with signposting to resources and eligibility checks.
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• People and networks increasingly seen as a better approach than businesses as entities: increasingly important and how people get advice. • Specific programmes well regarded and well-respected people:no shortage of commitment and energy, with some protectionism • Quite traditional and difficult to see the shared offer: Most programmes claim to be a response to fragmented, antecedent arrangements but limited evidence of progress towards cohesion.
Fig: 2 – Four Pillars of a new Business Support system.
15. The work has now developed 4 Pillars of a proposed new system see figure 2 above which are the main building blocks of any refreshed aproach. Each of the pillars in the figure above includes a list of some of the areas that might need to be included in any refreshed system under that pillar. 16. In addition there are a range design options / operational configurations available for each pillar which represents the options or choices for delivery as part of any new system. This will also support further design work as the policy, funding and operational context evolves. The four design options/operational configurations are: i) Roles and responsibilities, ii) Operational Approach,
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iii) Priorities for Investment and iv) Management Approach. 17. The choices can then be represented on a sliding scale as indicated below in fig 3 for the Integrated Customer Journey Pillar.
Fig 3: analysis of options re: Integrated Customer Journey
18. As can be seen from the above, while the principles are relatively straight forward the development of options and choices is more complex. The next steps are to develop this further along with a costed plan for essential work that needs to take place in order to implement the principles of the review. It is likely that this will be challenging for some of the partners and organisations as it will require them to do things differently and leave behind current processes and systems. 19. The end of this phase of activity will need to be agreed amongst all the key partners during July, including the LEPs, the SED Board, the Combined Authority and the Local Authorities that form a part of it. An report will come to this Board for agreement at its 15 July meeting. Conclusions 1. This report provides an update on some of the work being undertaken by the LEP to support businesses and residents to mitigate the economic impacts of coronavirus and support new trading relationships with the EU.
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2. The Board is asked to comment on GBSLEP’s current suite of interventions and plans to support businesses.
Report by: Ed Watson, Interim Chief Executive Officer Contact: [email protected] 07483 078447 Date Created: 25 May 2021
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Appendix A:
Recovery Taskforce Agenda 19 May 2021
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GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021 LEP Review
Recommendations Board Directors are asked to: I. Note and comment on the latest update in relation to the LEP Review.
Background 1. The Spring 2021 Budget announced a review into the future of LEP’s including their form and function as wells the issue of LEP geography. At a Ministerial level the review is being led by Paul Scully MP. Terms of reference for the review were finally agreed on at the end of April 21 (see Appendix A) by Ministers including Kwasi Kwarteng the Secretary of State at BEIS and MHCLG Secretary of State Robert Jenrick. 2. The LEP Network have been leading discussions with Government officials on behalf of the 38 LEPs, and have agreed five work streams flowing from the ToR and covering the following areas:
I. Objectives and Functions II. Geography III. Accountability IV. LA Representation and Interaction V. Implementation and Funding
3. A 6th cross cutting workstream was subsequently created covering Engagement and communications and is being chaired by GBSLEP chair Tim Pile. GBSELP is represented on the Geography working group. The full details of the membership of the groups can be found at Appendix B. 4. The agreed approach is that all workstreams have at least two meetings or engagement sessions, and in preparation for these, officials will draft a proposition paper, which the LN will then consider ahead of the 1st meeting. Further iterations are then produced for a second meeting and a final version produced for ministerial sign- off in the light of these discussions.
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5. The ambition was that the Ministers expected to set out their future proposals by the Summer and with a new operating model to be in place, at least in part, by financial year 2022/23.
Progress to date: 6. The initial timetable was tight with meetings covering all six of the workstreams happening in quick succession from late April to early June. Thus far the only workstreams that have met are the Functions and Objectives group which has completed its work, and the Communications and Engagement Group which has met once.
Functions and Objectives: 7. A full copy of the agreed final paper which is understood to have also been seen and agreed by Ministers can be found at Appendix C. It states that the future objectives of LEP’s should be to focus on:
‘driving prosperity through inclusive growth, capitalising on their unique role as impartial convenors to deliver the Government’s Plan for Growth at a local level. Reformed LEPs should retain their strategic role, represent and support local businesses, improve productivity and support the development of their area’s comparative economic advantage.’
8. The paper then sets out three broad functions for future LEP’s. In summary these are:
• FUNCTION ONE: To fulfil a strategic role, providing place-based economic expertise and insight to central and local government and helping secure long- term inclusive growth at the local level as part of the Plan for Growth.
It is suggested that this might also include roles in relation to skills policy; endorsement for some strategic investment decisions; and identifying R&D and innovation assets. However this would subject to further discussions with other departments in Government etc and so there is no guarantee that these would end up within the remit of reformed LEPs.
• FUNCTION TWO: To identify key local sectors and industries, and to design and deliver interventions to make them more competitive, making the most of local opportunities.
This section talks about working to develop areas of comparative economic advantage and identifying opportunities for inward investment that would support this. It confirms that Enterprise Zone activity would remain with LEP’s and they could support the development of capital investment bids with other partners.
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• FUNCTION THREE: To deliver a programme of joined-up, expert and tailored business advice and support for local businesses, ensuring they can play their full part in the Plan for Growth.
The focus in this area of activity from Government’s perspective is their desire to have a single standard business support offer across the Country delivered locally via Growth Hubs. It would also allow for a small amount of local variation in the support offer.
Geography 9. The meetings for the geography group were initially set for early May and at the time of writing have yet to be rescheduled. There has been delay in issuing a draft of the geography paper. It is understood that an early draft did emerge however it was so lacking in clarity in relation to the Government’s ambition that it was not considered worth discussing. The point has been made to officials that they need to be clear and honest about their position and potential red lines on this matter before discussions proper can start.
10. The paper has now been published in advance of the meeting of the geography working group which is still yet to be arranged. The paper suggests that the task of the group is to identify the most pragmatic approach LEP geography recognising that whatever the solution, it is likely that activity will also need to take place across larger or smaller spatial tiers. The paper goes on to make a positive and helpful initial statement that ‘local economic planning, overall, is best delivered at a functional economic area (FEA) level that works across fragmented political/ administrative boundaries.’ This is followed by an analysis of the various different partners and activities which set the context for LEP activity and to which any solution on boundaries will need to address.
11. Principles for the LEP geographies are then proposed. This includes confirmation that LEP’s should continue to align with FEA’s and that there should be a low change approach to ensure as much continuity as possible. The paper then seems to contradict the logic of the above statements by suggesting that there should be alignment with Mayoral Combined Authorities wherever possible and that overlapping boundaries should be removed. There is a specific suggestion that both of the above should apply to the West Midlands.
12. The paper poses three questions that the group should consider and which the Board may want to address in dicsussion. These are:
• What is the best approach for ministers to take in tidying up any remaining overlaps and ensuring alignment with MCAs where they exist? Are there any
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other areas you feel the existing LEP map does not effectively map to an FEA? • While retaining flexibility, and ensuring strong governance, how can we improve joint-working between LEPs on work associated with comparative advantage where those opportunities span a wider area? What examples are there of where this has worked effectively in the past to deliver for local economies? • How can we ensure the strategic business voice function has teeth and is able to effectively challenge and input into strategies across a more fragmented local landscape – e.g. local authorities, BROs, etc. How can we ensure LEPs, sitting at an FEA level, can bring some coherence to this? Issues Arising: 13. This is a clear constriction of the expansive scope of activities currently delivered by GBSLEP and others. Although for those LEPs who have a narrower outlook this may not reflect a significant change. It has already been made clear in the Terms of Reference of the Review that Government has decided to ‘entrust’ decisions in relation to bidding for capital funds to Local Government and this is played out in the objectives and functions above. This is major challenge for the role GBSLEP has played and we will continue to demonstrate the effectiveness of our activity in this area going forward (see the communications section below).
14. The working group made positive progress in developing this document into something that is broader given the constraints set by the review ToR. The implications of the actual wording are that although there is still a potential role for LEPs in relation to business support, some elements of strategy and sector support, the precise scope of this is far from certain. As the Board will see much of the language in relation to those areas where GBSLEP had previously played a strong role are couched in terms that suggest significant potential for interpretation which could lead to a very narrow role. Moreover, it is also very difficult to foresee how these functions will play out when matters of geography and funding are still subject to review and discussion. Another reason for concern is the delay in progress with the other working groups.
15. In terms of the Geography paper, there is specific reference to and targeting of the West Midlands and hence GBSLEP. This is both the suggestion that the LEP should reflect the WMCA boundaries and that overlaps should be ended. This is a fundamental problem for GBSLEP in that there is an inherent contradiction between the idea of FEA’s as reflected in our current boundary, and the CA/overlap proposal.
16. It is proposed that we continue to argue strongly, as we have before, that our FEA should take precedence and decisions about overlaps should be make locally by those Authorities impacted.
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17. One of the challenges for LEP’s in managing all aspects of their business during this period is uncertainty – particularly in relation to retaining both staff and the engagement of Board members. The current delays not only jeopardise the likelihood of keeping to the agreed timetable but in turn threaten the ability of the LEP to function if key members of staff leave. As the Board will be aware GBSLEP has a fully funded programme of activity right up to the end of March 2022 however if staff depart or the Board is unable to function then delivery will be threatened. Communications 18. As well as contributing to the Communications and Engagement workstream and keeping staff updated with progress via weekly team meetings and surgeries, the Executive have been developing a range of complimentary communication activities: 19. An e-brochure has been produced which will act as a ‘shop window’ into the achievements of GBSLEP over the last year and outline the Delivery Plan for 21/22. The brochure, Delivering Our Future Together – Impact, Insights and Plan 21/22, is being shared with MPs, Ministers, civil servants, local government, businesses and academic partners. It will also be distributed to wider stakeholders through industry networks and regional ‘influencers’. Board members are encouraged to endorse the achievements of GBSLEP and to share the brochure with your networks once it has been emailed to you. 20. The #TripleHelix digital communications campaign has also been launched to elevate the impact of GBSLEP’s investments over the last decade. The communications objective is to emphasise GBSLEP’s unique structure of bringing local government, businesses and educational organisations together to make strategic decisions that drive forwards inclusive economic growth. The #TripleHelix communications campaign will run in parallel to the LEP Review. It will reflect the themes and language set out in the terms of reference and LEP Network communications to Government. The campaign will run for 4-5 weeks and has been organised to cover the following themes:
i. GBSLEP’s unique partnership structure and how this leads to job creation and economic growth. ii. Investments and impact of capital funded projects. iii. GBSLEP’s sector led work in priority growth areas as originally set out in the West Midlands Industrial Strategy. iv. The difference GBSLEP is making to the people and places of the region.
21. Content will be made up of video case studies, testimonials and factual social media slates. These media assets will be shared on GBSLEP channels to celebrate successes. Board members are urged to share the content and to comment through personal profiles.
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22. In addition to this further PR activity will accompany the #TripleHelix campaign including: i. A spoken word piece has been commissioned to demonstrate the impact of GBSLEP’s investments on young people. This will be performed and filmed in all 9 Local Authority partner areas and will feature projects funded by GBSLEP. The aim is to get mainstream media coverage with the objective of showing the difference GBSLEP is making across the region through skills training, placemaking and infrastructure investments. ii. GBSLEP is liaising with the LEP Network on joined up messaging and exploring the option of an ‘open letter’ to a national newspaper to demonstrate the importance of LEPs. iii. Thought leadership pieces will be shared with appropriate trade publications.
23. There have also been a number of statements from partner organisations setting out their support for the role of LEP’s going forward e.g. from the CBI and Localis. The Minister for Small Business has also re-iterated his support for the evolved function of LEP’s going forward at recent Select Committee hearing. The chair has written to the Board separately highlighting this activity.
Conclusions 24. The LEP review represents a significant challenge to the role and function of the GBSLEP. The objectives and functions paper is better than the nitial draft but there is still considerable scope for a very different type of LEP to emerge at the end of the review. 25. Despite a good start in process terms, progress has slowed which is concerning in terms of the ability to meet a challenging timetable for the decision making. This in turn has implications both for retaining the interest of the Board, staff retention, programme delivery and the ability to manage a smooth transition to the new arrangements. 26. The executive will continue to keep the Board, staff and partners informed on a regular basis. An update will be brought to the next meeting. 27. The Board is invited to: • comment on and discuss the issues that arise from the review and the matters raised in this paper. Report by: Ed Watson, Interim Chief Executive Officer Contact: [email protected] 07483 078447 Date Created: 28 May 2021
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Appendix All Appendices Exempt from Publication A Terms of Reference of the LEP Review B LEP Network – Review Working Groups C Agreed output from the Objectives and Functions group
03/06/2021 7 of 20 Item 6
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021
GBSLEP Young People Strategy update
Recommendations
Board Directors are asked to:
1. Note and comment on the content of the report, which shows progress against the Young People Strategy, the development of which was agreed at the March 2021 Board meeting.
Background
2. The Board meeting in March 2021 considered a report by Spencer Wilson about the challenges faced by young people in the GBSLEP area as a consequence of the pandemic having exacerbated many previously existing issues relating to exclusion, (mental) health inequalities, skills and employment. 3. The Board decided to develop a Young People Strategy, based on two areas of focus: • Inspiring and engaging young people, and • Providing access to work and training 4. It was agreed that the strategy should be guided by a Task and Finish Group and by input from local young people and that it should ensure that future interventions meet the identified needs of young people, that impacts are suitably measured and that the potential damage to and blight of a future generation is minimised. 5. Cllr Brigid Jones and Sophie Drake kindly volunteered to join the Task and Finish Group.
Update
1. In May, an update was presented to the Recovery Task Group.
2. A Task and Finish Group has been set up and a first meeting is being arranged for June. Membership comprises: Cllr Brigid Jones GBSLEP Board Sophie Drake GBSLEP Board Nicola Turner Commonwealth Games 2022 Legacy Team Aisha Masood or Chris Burden Young Combined Authority Abdul Asghar Prince’s Trust Spencer, Satnam, Henriette GBSLEP Executive Team
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3. The draft aim of the Strategy (which is work in progress and will be subject to debate and agreement) is to: Address the issue of significant unemployment and disadvantage for young people in the GBSLEP area and to create opportunities to improve employability and to be engaged in decisions regarding their area, in order to improve their current and future prospects. 4. Four underpinning principles of the strategy have been drafted (again, subject to debate and agreement): Do not reinvent the wheel – if another suitable vehicle already exists, let’s join it; Work in partnership. (How) do we know what’s already out there? Write a light-touch strategy, with a focus on ACTION Play to our strengths (business-led, aligned with our resources, involving the triple helix of Principles: business/education/local government)
5. Based on the GBSLEP’s three-fold role, the Strategy will see the GBSLEP act as: 6. Agitator: raising the issue of the pandemic having exacerbated existing challenges and inequalities for young people in our area. Engaging young people in our work by involving them in an advisory capacity onto our various boards is one way of 7. Commissioner: allocating resources to activity that directly benefits young people. This will include activity specifically designed to target young people (e.g. the Skills and Apprenticeship Hub), as well as activity that could be directed to ensure it benefits young people (e.g. the Cultural Action Zone, the e- commerce business support). A mapping exercise has been completed for the Skills area and is being undertaken for the Place, Programme, Business and Innovation and sector plans also to ensure a focus on young people is embedded where it is appropriate and feasible to do so. 8. Enabler: collaborating and engaging with partners to encourage and persuade them to commit to delivering tangible activities aimed at supporting the Young People Strategy. This may include working with organisations who are or have been in receipt of our (grant) support, as well as with businesses and other partner whose objectives are aligned with the Strategy. 9. Most of the resource to deliver the strategy will derive from re-focusing existing and planned activity. In addition, we are identifying a limited bespoke budget (circa £100k) for new activity. 10. To capture the impact of this work, our in-house evaluation secondees from WM REDI are developing an evaluation framework which will be shared with the Task and Finish Group. 11. Our timeline is: Mapping of current activity and identifying gaps and opportunities May Drafting the Strategy June Signing-off and launching the Strategy (early) July Deliver Direct Action to support young people: ongoing
Conclusion 12. A draft strategy will be submitted to the Board in July for sign off.
Report by: Henriette Breukelaar, Director of Economic Strategy Contact: [email protected] Tel: 07712436969 Date Created: 2 June 2021
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Item 7
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021
GBSLEP Delivery Plan 2020/21 – Quarterly Progress Report
Recommendations
Board Directors are asked to:
1. Note and comment on the content of the report, which shows performance against the 2020/21 Delivery Plan for Quarter 4, up to the year end. At the time of writing the figures had not yet been audited and could therefore be subject to some final change.
Background
2. As part of the LEP Assurance Framework we are required to submit an annual delivery plan to central government that sets out our programme, project and investment activity across all funding streams. 3. The 2020/21 delivery plan which was endorsed by the Board in September 2020, was revised to take account of new activity and resources that were specific to our response to the pandemic. 4. The Board asked that the Executive provide quarterly progress reports on the delivery plan. The purpose of the reports is to provide a headline summary of main areas of activity and expenditure (as shown in appendix a) without duplicating more detailed progress and delivery reports that are submitted to the Board, Recovery Taskforce, Programme Delivery Board etc. 5. The report shows a RAG (red, amber and green) rating of the status and performance of each main area of activity against delivery and spend targets. A green rating indicates that activity is on profile, amber that there are some challenges and red indicates significant problems. These ratings are consistently applied to highlight status and indicate where remedial action is needed. 6. Many of the strategic activities in the annual delivery plans are implemented over more than one year. In practice, complex and larger scale projects have a development and a delivery stage, with spend and outputs phased over the life of a project. Performance of the project within the respective timescale and spend profile is accounted for in the RAG rating.
Update
7. As shown in appendix A, progress on delivery plan activity at the end of the 2020-21 reporting period is largely good, with seven of the 16 reported projects rated ‘green’ in terms of expenditure and activity. 8. Nine of the 16 activities are indicated as amber at the end of the financial year. 9. Some delays in spend and delivery had already been incurred prior to the pandemic due to a variety of circumstances including staff changes and time needed to finalise contracts. This,
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plus the lockdown that was in place at the start of the financial year, significantly disrupted delivery.
10. The 2020-21 Delivery Plan was substantially revised in September 2020 to reflect the inevitable delays due to the pandemic and the lockdown restrictions. Much of the activity in the revised Delivery Plan, however, was based on the assumption that we would return to ‘business as usual’ after the Summer. This turned out to be over ambitious as it hadn’t taken into account a further – and longer – lockdown period during which many of the businesses and partner organisations we work with were busy adapting to circumstances and didn’t have capacity to engage with us in the way that was planned.
11. Although the above meant we saw a significant underspend in most areas, this is now mitigated by the fact that we have carried forward the budget and that we have continued to engage businesses and partner organisations. This means we are in a strong position to recover and achieve targets set in our delivery plans, albeit later than anticipated. 12. During Q4, programmes that were significantly underspent have stepped up activity and expenditure. These include the Pivot & Prosper Grant Programme, the Towns and Local Centres programme, Low Carbon Supply Chain Innovation and Skills Innovation commissioning that are well underway and should bring overall levels of spend to profile over 2021/22. Achievements and issues arising: 13. The Skills and Apprenticeship Hub was formally launched at the GBSLEP Annual Conference (30 November 2020), with the website going live on 03 December 2020. The Hub has started strongly and is delivering skills interventions to businesses and GBSLEP’s Plan for Jobs interventions, including Kickstart. Up to April 2021 the Hub engaged: 313 local businesses with 94 completing Training Needs Analyses; 53 employers have been refereed to Kickstart Gateway organisations; 27 Kickstart placements have been approved by DWP with 71 pending approvals and 77 in the pipeline to be referred to Gateway organisations.
14. Enterprise Zone Capital Spend for 2020/21 is £21.6m. The Q4 position is slightly stronger than anticipated at Q3, with surplus increasing to £5.6m, as a result of both an increase in net Business Rates Income and reduced capital spend for the year (a reprofiling of project expenditure). Business Cases for both Paradise Phase Three (£54m request) and Martineau Galleries (£70m) have been received and evaluated in Q4. Digbeth High Street investment of £15.7m was approved, and Southside Public Realm has commenced on site.
15. The final quarter of the Local Growth Fund has successfully managed to achieve the remaining £9.0m of the programme through £7.65m grant claims and £1.35m of programme ‘freedom and flexibilities’, which has brought the grant of £186.05m to a financial completion. The remaining key task is to ensure deliverability of the programme outputs and outcomes.
16. Acceptance of the returned DfT funding (£21.851m) into the Local Growth Programme provided a great opportunity to support additional projects at this time. Twenty projects have been supported from the additional grant funding with all projects approved. BEIS approved flexibility for up to £3.6m to carry forward to 30 June 2021. To the end of March 2021, subject to final assurance from BCC, approx. £18.3m of grant funding has been processed with a small amount of ‘programme and flexibilities’ (less than £0.01m) required to support this great achievement in such a short timescale.
Conclusion
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17. Overall performance in 2020/21 against the delivery plan was strong, particularly given the unprecedented disruption caused by the pandemic. Any delay in expenditure and activity has been carried forward into 2021/22. 18. An new delivery plan has been produced for 2021/21 and there will be regular reporting on performance and progress to the Board showing the latest position on a quarterly basis throughout 2021/22.
Report by: Henriette Breukelaar, Director of Economic Strategy Contact: [email protected] Tel: 07712436969 Date Created: June 2021
Appendices A. Delivery Plan 2020/21 – Report Table
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2020/21 Delivery Plan Progress Report Appendix a
Theme Key Activities RAG Expenditure (P9) Status and Issues Arising Rating SEP Enabling Fund Activity Business Next Phase of Growth Hub Budget: £86,335 • Recruitment of sector advisers completed. Support Access to finance Spend: £61,864 • LEP Board agreed next steps for 2021/22. Partnership with DIT • Ongoing discussions with DIT on export trade and Brexit support. Support for diverse businesses Green • ICLP nearing completion. Two Cohorts have supported 50 businesses Web access for Covid support and has led to the creation of 12 new jobs. Positive PR has also been achieved for a selection of SMEs on the programme. • Your Step Forward campaign live and providing access to services. Innovation Pivot and Prosper Grant Programme Budget: £2.041m • Pivot and Prosper 49/52 SMEs have claimed to a value of £1,590,578 Market-led innovation Amber Spend: £1,806,266 • 69 LGF projects with innovation components within capital Plan to expand IPO enabler project programme. • IP Enabler West Midlands commenced delivery. Will continue during 2021/22. Skills Employer-led approaches to skills Budget: £885,000 • Programme of 8 skills innovation projects selected for 21/22 delivery. Inspiration programmes Spend: £210,376 • Skills -Hub working with 218 businesses since launch Attract diverse talent to industry Amber • Strong pipeline of skills capital projects in place (4 projects approved Establish skills / apprenticeship hub totalling £3,831,791 of funding) Capital investment in academies • Ongoing inspiration activity with schools and colleges into 2021/22, targeting growth sectors. Place Making TLC framework funding round 3 Budget: £1.356m • TLC – grant agreements finalised for last funding round. Project Whole Place Project Spend: £190,202 monitoring ongoing including opportunities to publicise activity. Cultural capacity devt projects • Whole place pilot discussions being held with partners including Heritage-led regeneration call Amber bringing together of themed groups to develop actions and a wider Crowdfunding initiative partnership meeting in June. Discussions ongoing with Longbridge Covid-19 support for retail developers as well as other partners re potential LUF bid. Action the employment site study • Further round of Cultural Actions Zones to be launched by end May 21 to support recovery and wider activity in places/high streets. • Employment site study completed and will publish in June. • Discussions relating to Crowdfunding pursued with BCC re ensuring legacy in place and simplification of contractual requirements.
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• Covid 19 support being built into mainstream activity as part of TLC refresh and digital conversations with partners. BPFS / Modern Proftec cluster development Budget: £250,000 • Supertech cluster launched Services BPFS skills development project Green Spend: £90,917 • Skills development activity being designed. Life Science / Health tech cluster development Budget: £150,000 • HTC business plan produced for 2021 – 2023 period. Health Tech PHTA investment Spend: £102,098 • PHTA funding secured and project underway. Assess incubation space Green • Incubation space assessment complete and used by Growth Company. Employer led skills development – • Employer-led skills programme launched with Cogent (SIP WM). launch of the SIP • Life Sciences Skills report launched. Life Science Skills report • Life science supply chain mapping second stage completed. Life sciences supply chain mapping Creative Pipeline of capital investment Budget: £50,000 • Strong pipeline of capital projects developed. Industries Launch cluster development fund Green Spend: £57,835 • First round of cluster development fund commissioned Improve skills pipeline • Discussion on skills pipeline underway. Adv Mfr and– Higher level skills framework Budget: £116,000 • Cyber security engagement being delivered via Growth Hub to SMEs Food and Drink Aerospace skills assessment Spend: £10,974 • Aerospace Skills project complete (settlement post-March 21) Career pathway related activity Amber • F&D Higher level skills assessment being specified for commission Skills Demand and Provision Study (delayed to 21/22) Winning Bids - A programme for food • Review of vocational pathways underway delayed to 21/22 and drink manufacturers • Winning Bids Programme initiated Sector engagement strategy • Sector engagement strategy initiated Low Carbon Growth Hub low carbon advice Budget: £160,000 • Growth hub account manager in post. By year end, they supported 36 and Energy Skills needs and pathway to LC Amber Spend: £12,000 Low Carbon businesses and delivered 11 complete interventions. Improve low carbon supply chain • Delivery of Low Carbon Grant Fund: 16 applications received; 3 projects funded (total of £97,700). • Quantitative analysis of the Low Carbon sector was completed by the Midlands Energy Hub, providing evidence to inform future policies and interventions to enable the growth of the sector. Local Growth Fund Programme Programme of 78 projects with 34 Budget: £53.32m • Last year of the five-year programme. live projects within the LGF capital Spend: £53.32m • Programme fully contracted. programme. LGF programme Green • Spend for final year all defrayed with £1.35m managed using programme freedom and flexibilities.
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financially completes on 31 March • Outputs and outcomes to be monitored going forward to ensure the 2021 with ongoing monitoring of programme achieves its non-financial performance targets. outputs and outcomes required. Returned LGF Funding Programme Returned monies to the Local Budget: £22.851m • Decision to accept DfT returned funding end of July 2020. Growth Fund from the Department Spend: £1.17m • Funding received of £21.851m by BCC on 3 September. of Transport for Growth Deal monies • PDB Subgroup set up to consider and prioritise the investment projects allocated to a Major Transport to ensure deliverability and value for money. project (A457 Dudley Road) Amber • Seventeen projects approved, to the value of £21.68m. • Strong robust pipeline of projects to take up the full value of the balance under consideration. • Great opportunity but challenge to contract and defray spend by 31 March 2021 – extension for £3.6m to roll over to 30 June 2021 has been agreed in principle by BEIS (awaiting formal approval) Other Funding or Growth Programmes ESIF ERDF SME Re-start Grants Budget: £990,000 • Small grants for technology/professional services support for Amber Spend: £950,000 businesses, 379 applications received, 268 approved and paid (original target 296 approved and paid)
• Growth Hub funding runs to 30 September 2022 1,400 businesses supported (medium intensity), 500 businesses supported (high Budget £1.4m p.a. Growth Hub core funding intensity) Spend: £1.4m • Achieved 1,100 medium intensity (over profile) with 100 high intensity (under profile) in 20/21 Growth Hub Peer to Peer Networks Budget: £240,000 • National programme from BEIS to establish SME peer groups, in five Amber Spend: £240,000 key sectors supporting up to 176 SMEs by 31 March 2021. Original numbers reduced from 198 • Programme attracted 165 businesses, signed up and onboarded. All 16 and 18 cohorts to 176 and 16 cohorts cohorts were delivered and a total of 131 businesses completed the full given delivery in only four months programme • Peer Networks Round 2 confirmed for 21/22 with target of 18 cohorts and 198 businesses recruited and delivered Birmingham Programme currently “amber” due 2020/21 actual • HS2 Curzon Station Metro Stop, FBC approved Enterprise Zone to impact on business rates income spend: £22m • Digbeth Public Realm, FBC approved arising from C19 and other factors. • Belmont Works, FBC approved
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Amber capital, £1.1m • Birmingham Smithfield, SOBC approved. Capital target to 2025/26, £294m* revenue • Birmingham Smithfield Enabling Works OBC approved. (achieved to date £176m, 60%). Business Rates • Southside Public Realm, FBC approved. Revenue target to 2025/26, £9.6m Income, £6.9m • Old Curzon Station, OBC Approved (FBC delayed to Q3 2021/22). (achieved to date £7.8m, 81%). • HS2 Curzon Public Realm, FBC delayed (Q3 2021/22) Net Business Rates Income target to 2020/21 Q4 overall • Paradise Phase III, Interim Business Case (IBC) approved by PDB. 2025/26, £119m (achieved to date financial position, • Development of refreshed Enterprise Zone Investment Plan 2021 £25m, 21%) £5.6m (Surplus). commenced.
* Reduced from £585m (EZIP19) Financial Principle 16 Applied to EZ Model (removing capital/revenue expenditure from programme unless OBC approved). Therefore, only expenditure with OBC (or more) approved included. Growing Places Government allocation of £22.49m. Programme Total: • Five capital projects remain in delivery – The Grand Hotel, the Fund A mixture of grant and loan funding £22.49m Mezzanine Fund, Creative Content Hub, Open House (The Repertory to unlock stalled sites to create new £20.8m capital Theatre) and Junction Works. homes, employment and growth £1.7m revenue • £5m of GPF grant has been paid to support the delivery of The Grand across the LEP geography. Green Hotel in Birmingham City Centre. It has reached practical completion in October 2020 and has now re-opened its doors in May 2021 to the public in a covid-19 safe manner. • The Mezzanine Fund is an evolving package to support SMEs across the Region. The GBSLEP commitment of £10m completed on 30 June 2020 and all loans are forecast to be repaid in full. • The Creative Content Hub and Junction Works are being support with a mixture of LGF and GPF. Creative Content Hub has received planning permission with works to refurbish the Oval planned in the Summer supported with circa. £2m GPF grant support. • The Open House Rep will also start works in the Summer supported by grant of £1.47m. • Junction Works have secured a loan of £0.18m and will commence works once all the project funding is in place.
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Getting Building Government funding awarded to Budget: £14.829m • GBSLEP had a total of 57 Expressions of Interest with a value of £362 Fund shovel ready projects which could Spend: £7.90m million for this Funding. support Economic Growth. Two • After internal review GBSLEP put forward 27 projects to Government projects successful for GBSLEP area - with a value of £167 million. University Station, PHTA and a Green • The West Midlands was allocated £66m for shovel ready projects. further one delivered by WMCA - • GBSLEP received funds for University Station - £10.86m and PHTA - WM5G Application Accelerator £3.969m. across the wider West Midlands • Back-to-back agreement have been signed and Tranche One monies of area. £7.94m have been received in December 2020. • Both projects have grant agreements in place and have commenced delivery. • Spend of £7.9m all defrayed with £3.9m managed using programme freedom and flexibilities, with full spend anticipated by 31 March 2022.
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Item 8
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021
FUNDING INVESTMENT RECOMMENDATIONS
Recommendations
1. At the Programme Delivery Board meeting on 19 May 2021, members agreed with the findings from the Finance Working Sub-Group (FWSG), namely to: i. Note the investment options for the £7.3m forecast funding balances considered by the FWSG and PDB. ii. Recommend to the Board that these balances should be used as follows: • Revenue Grants for unfunded revenue projects £0.66m • Revenue Grants for green Pivot & Prosper projects £1.00m • Capital Loan for Junction Works project (PDB approved) £0.18m • Capital Grant for Open House project (PDB submission) £1.76m • Grants for other capital and revenue pipeline projects £2.20m • Operational Contingency retention – LEP sustainability £1.50m iii. Recommend to the Board that the current Finance Working Sub-Group (FWSG) should be ended once the recommendations above have been approved and that the PDB should take over the responsibility for considering any changes to this investment strategy in future. iv. Recommend to the Board that a new working group is established once the outcome of the current LEP Review is published, to consider future GBSLEP budget requirements and any financial changes needed. 2. Board Members are asked to note the investment options referenced at 1.i. above and to endorse and approve the adoption of the recommendations referenced at 1.ii.,1.iii.and 1.iv. above.
Background
3. The FWSG was established in January 2021, following Board agreement, to consider the LEP’s forecast funding position and investment options in more detail and to recommend to the Board how balances should be used. 4. The members of the FWSG are Michael Steventon (Chair) and Cllr George Allen, and they met with representatives of the Executive on 2 March, 26 March and 27 April.
Item 8
5. The FWSG was provided with forecasts of the revenue and capital funding balances at the end of March 2021 and March 2022. 6. The list of pipeline revenue projects and the list of pipeline capital projects were also provided to the FWSG members. 7. Several different investment options were considered by the FWSG and the likely financial returns of each option. (A copy of this paper is available at Appendix 1) 8. This paper presents the FWSG recommendations for investing the forecast funding balances.
Key Issues
Latest Forecast Funding Position 2020/21 and 2021/22 9. The latest forecast of the funding balances available for investment at 31 March 2021 and the closing funding balances for the 2021/22 financial year as included in the approved Delivery Plan, is as follows: Forecast Funding Balances at: 31 March 2021 31 March 2022 £m £m Business Rates Pool/SEP Enabling Fund 5.6 (0.6) Other revenue balances (March 22 GPF) 1.1 0.6 Recycled LGF 1.7 1.1 Growing Places Fund (GPF) 11.6 5.6 Other capital balances 6.0 0 TOTALS £26.0m £6.7m
Table 1.0
Notes
1 GPF - As all of the balance now consists of recycled loan repayments, it is available for any purpose, revenue or capital
2 GPF – Figures do not include some repayable grants which are being reviewed with the applicants for likelihood of repayment
3 Recycled LGF – Where LGF grants are made and then repaid, they can be recycled for any purpose, revenue or capital; a further £0.79m is due back from Redditch Gateway project by 2024/25; latest advice maybe 2021
4 The gross funds are £7.3m which nets to £6.7m
10. This therefore leaves decisions to be made on what to invest the following £6.7m capital balances in: • £5.6m Growing Places Fund monies (£5.6m + £0.6m - £0.6m) • £1.1m LGF Recycled monies (does not include £0.84m due back by 2024/25)
Item 8
Investment Options Available 11. The FWSG and PDB recommends that funding should be invested in four high priority revenue and capital projects first. i. The Delivery Plan presented at Item 7 of the March 2021 Board meeting identified that the SEF did not have capacity to cover the £250k matched funding for the Growth Hub and for the potential matched funding of £416k for the ESF Skills hubs application and that they should be considered for funding from the Growing Places Fund. ii. The Delivery Plan also identified a potential “Green Pivot and Prosper” intervention. An application has since been made to the Community Renewal Fund to match the £1m GBSELP funds. iii. PDB have approved a loan for a capital: The Junction Works project by applicant Grand Union for £0.18m repayable three years later with rolled-up interest. iv. PDB have also approved a project on the Capital pipeline that requires a £1.76m grant and is considered a high priority, the Open House project from the REP.
12. The funding balance left for investment would then be £3.7m as follows:
Table 2.0 13. Given the current uncertainties surrounding the future shape, responsibilities and geography of GBSLEP with the commencement of the national LEP Review, it was felt prudent to retain some of the available funding balance as an operational contingency to support LEP sustainability. An amount of £1.50m was considered sufficient to be held back for this purpose to cover capital programme monitoring and assurance of outputs, LEP governance, operational overheads, accounts/audit/tax fees. While other funding sources will be sought to pay for these costs, the retention of an operational contingency was agreed to cover the risk that other funding would not be available.
Item 8
14. These costs have been estimated as follows: 2022/23 2023/24 Total £m £m £m Programme Team resources (excl EZ 0.35 0.25 0.60 programme team as funded by EZ PMO charge) LEP governance resources 0.10 0.10 0.20 Overheads – Finance, IT, HR, legal, 0.40 0.20 0.60 accommodation Company stat accounts, audit, CT 0.01 0.01 0.02 Contingency 0.04 0.04 0.08 Total £0.90m £0.60m £1.50m Table 3.0 15. The FWSG considered that the remaining balance of £2.2m should be used straightaway to fund other priority projects on the capital pipeline (see Appendix 2) and on the revenue projects pipeline; consideration of which projects should be awarded this funding would follow the normal assessment and PDB approval route and be considered in line with other funding opportunities eg the Community Renewal Fund applications
Recommendations 16. The following recommendations are made: i. That the £7.3m forecast funding balances should be utilised as follows: • Revenue Grants for matched funds (per delivery plan) £0.66m • Revenue Grants for green Pivot & Prosper projects £1.00m • Capital Loan for Junction Works project (PDB approved) £0.18m • Capital Grant for Open House project (PDB submission) £1.76m • Grants for other capital and revenue pipeline projects £2.20m • Operational Contingency retention – LEP sustainability £1.50m ii. Recommend to the Board that the FWSG should be ended once the recommendations above have been approved and that the PDB should take over the responsibility for considering any changes to this investment strategy in future iii. Recommend to the Board that a new working group is established once the outcome of the current LEP Review is published, to consider future GBSLEP budget requirements and any financial changes needed
Item 8
Conclusion
17. GBSLEP has a number of funding balances that require PDB and the Board to decide how they should be spent. There are several different investment options that need to be considered. 18. PDB has considered these investment options and recommends to the Board that the £7.30m forecast funding balances should be spent on specific Revenue grants £1.66m, a specific Capital loan £0.18m, a specific Capital grant £1.76m, other priority Capital and Revenue grants £2.20m and the balance of £1.50m to be retained as an operational contingency to ensure GBSLEP remains a going concern.
Report by: Kate Shaw Chief Operating Officer
Contact: [email protected] 07860 906438
Date Created: 27 May 2021
Appendices Appendix 1 FWSG paper – Funding Investment Options (26 March 2021) Appendix 2 Capital Projects Pipeline
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
GREATER BIRMINGHAM AND SOLIHULL LEP FINANCE WORKING SUB-GROUP MEETING
26 MARCH 2021
FUNDING INVESTMENT OPTIONS
Recommendations
1. Sub-group members are asked to: a. Note the latest forecast funding balances position for the end of the current financial year and for the next financial year b. Consider the possible options presented for utilising these funding balances c. Recommend to the PDB and then to the Board how these balances should be utilised
Background
2. GBSLEP has been in a fortunate financial position over recent years having significant funding balances to use for capital and revenue interventions and also to generate interest income on invested balances and SME loans which has supported operational costs. 3. Future years will be different as much of this funding has now been spent on capital and revenue projects and much funding has now finished. 4. There is now some clarity on future intervention funding for GBSLEP following the Budget announcements on 3 March 2021. The Levelling Up funding and the UK Community Renewal Funding (one-year pilot for the UK Shared Prosperity Fund) will be managed by Combined Authorities and Local Authorities rather than by the LEPs. There will also be a full review of the role and geography of the LEPs taking place over the Spring/Summer. 5. Consequently, there will be much less funding available for revenue and capital interventions by LEPs and for operational activities of LEPs from next financial year, 2021/22. 6. It is therefore necessary to consider what options are available for spending existing funding balances on and what the priorities should be for this money. 7. This paper presents information on current funding balances, forecast future balances, options for spending these balances and the impact of following those options. 8. It is recognised that the options presented and any investment decisions taken at this stage are based on the information available at the time of writing this report – as discussions are finalised with local councils and with the Combined Authority on the involvement of GBSLEP in any future capital and revenue intervention funding, the investment decisions made may have to be re-considered.
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
Key Issues
Latest Forecast Funding Position 2020/21 9. The funding balances position for the last three years has been £64m at the end of 2017/18, £67m at the end of 2018/19 and £50m at the end of 2019/20. These high levels have been as a result of large balances held in: • Local Growth Fund (LGF RIF - up to £36m) • Growing Places Fund/Mezz Fund (GPF/Mezz - up to £13m) • Local Growth Fund 3 (LGF3 - up to £11m) and • Business Rates Pool/SEP Enabling Fund (BRP/SEF - up to £11m) 10. The breakdown of the funding balances last year-end and the latest forecast for this year-end is as follows: Fund £m Actual Balance Forecast Balance @ 31 March 2020 @ 31 March 2021 Revenue Admin Reserve (Operational funds) 1.4 0.5 BRP/SEF 9.2 5.6 GPF 0.6 0.6 11.2 6.7 Capital LGF 1&2 21.6 1.4 Recycled LGF 0 1.7 Dept For Transport (DFT) Portfolio Schemes 1.0 0.9 Returned DFT 0 3.6 LGF3 (other BEIS funding) 4.0 0.1 GPF 11.7 11.6 Getting Building Fund (GBF) 0 0 38.3 19.3 TOTALS £49.5m £26.0m NB The small balances on LGF and Returned DFT funds at 31 March 2021, the deadline for the end of the schemes, will be managed by BCC Freedoms & Flexibilities such that no grant is lost
11. As can be seen, much of this funding will have been spent by the end of 2020/21: • LGF 1&2 all spent by 31 March 2021 • LGF3 £16m all spent by 31 March 2021 • Returned DFT £22m received in 2020 and all spent by 31 March 2021 • BRP closed 31 March 2019 12. There is a spend deadline on the Getting Building Fund monies of 31 March 2022 so the full amount of the £14.9m grant is planned to be spent by then.
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
13. This leaves only £26.0m to be spent on grants, loans and operational costs in 2021/22 onwards, subject to the receipt of any new grant funding next financial year.
Latest Forecast Funding Position 2021/22 14. The latest baseline forecast of income and spend for the next financial year and the closing funding balances as included in the approved Delivery Plan, is as follows:
Notes 1 GPF - As all of the balance now consists of recycled loan repayments, it is available for any purpose, revenue or capital 2 Recycled LGF - A further £0.84m is due back from Redditch Gateway project by 2024/25 3 Admin Reserve - All Programme Delivery Team costs are fully funded by recharges to capital programmes so not shown here
15. The baseline forecasts above show that Admin Reserve/BRP funding will be insufficient to pay for operational expenditure next year by £0.6m – the only option is to seek approval to use GPF Revenue monies to fund this gap. This amount is included in the Revenue pipeline table in para 38. 16. This therefore leaves decisions to be made on what to spend the following £7.3m capital balances on: • £6.2m Growing Places Fund monies (£5.6m + £0.6m) • £1.1m LGF Recycled monies (plus £0.84m due back by 2024/25)
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
Impact on Investment Income 17. The interest income generated on fund balances and GPF/Mezz Fund loans in recent years has been substantial - £422k in 2017/18; £761k in 2018/19; £556k in 2019/20. 18. The forecast interest income for 2020/21 is only £354k and for 2021/22 is only £17k, as a result of significantly reduced funding balances and reducing amounts in GPF loans and Mezz Fund loans. Amounts due from Mezz Fund loan debtors at 31 March 2021 will be only £0.6m which will be repaid by the end of 2022/23.
Funding Balances Available 19. Ordinarily, BRP would be spent on revenue projects and GPF would be spent on capital projects, but there is flexibility on what BRP, GPF and recycled LGF monies can be spent on. Business Rates Pool 20. BRP monies are primarily spent on revenue projects but small amounts have been approved by the Board in the past to contribute towards operational costs where core funding has been insufficient. 21. In theory, if approved by the Board, BRP monies could also be made available to provide loans to local businesses for capital purposes, or to provide capital loans through the Mezz Fund. 22. There is a list of revenue interventions requiring funding support from BRP; there is also a need to use some of the funds to support operational costs next year. The Sub-Group is therefore not required to consider what these monies should be invested in. Growing Places Fund/Mezz Fund 23. GPF monies have previously been used to provide grants and loans to local businesses for capital development, and to provide capital loans to local SMEs through a Mezzanine Fund managed by Finance Birmingham. There have also been some repayable grants made which do not attract any interest and do not sit on the balance sheet as a liability. 24. The GPF loans were made on market borrowing rates (3-6%) so a reasonable return, and considerably higher than investing with a bank. 25. The Mezz Fund loans were all very individual, at much higher interest rates (10-24%) but with higher levels of risk. Since the inception of the Mezz Fund in 2016 there have not been any losses on loans made with GBSLEP funds. The net return in 2020/21 on current Mezz Fund loans is forecast at 12.3%. 26. The Repayable Grants have been made primarily to local councils with one being made to a private sector company. Those made to councils have been interest free and some with conditions to be met for repayment. The repayable grant made to the private sector company also has a repayment condition and this is based on achievement of a certain level of profits over the first ten years of trading. 27. A number of the Repayable Grants have yet to be repaid – work is ongoing to establish whether and when these are likely to be repaid. 28. The projects funded by GPF loans, the Mezz Fund loans and the Repayable Grants all provided relevant outputs and outcomes for GBSLEP.
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
29. GPF balances could be used to provide grants to relevant capital projects which would also generate relevant outputs and outcomes for GBSLEP. These balances could also be used to provide capital loans directly or through the Mezz Fund. 30. As all of the GPF balance now consists of recycled loan repayments, it is available for any purpose, revenue or capital. 31. More detail on the Growing Places Fund is contained in Appendix 1. 32. The Sub-Group is required to consider what these monies should be invested in. Recycled LGF 33. Recycled LGF monies are available to be used for any relevant purpose required by GBSLEP, so they could be used for pipeline capital project grants, or for capital project loans including Mezz Fund loans. 34. As all of the Recycled LGF balance consists of recycled grant repayments, it is available for any purpose, revenue or capital. 35. The Sub-Group is required to consider what these monies should be invested in.
Pipeline Projects 36. There is a pipeline of capital projects and a pipeline of revenue projects that are maintained in the event that the LEP secures further funding. 37. The capital projects pipeline which are all looking for grant funding is included at Appendix 2. In summary, there are 15 projects with a total value of £56m and a range of Outputs and Outcomes which could be invested in if the funding was available. 38. The revenue projects pipeline consists of only a few unfunded projects as follows:
39. The first two items in this pipeline represent the forecast £0.6m BRP/SEF unfunded spend in 2021/22 in the forecast funding position (para 14). 40. There is one capital project that requires a loan which has been approved by PDB – The Junction Works project, and Grand Union is the applicant, the loan being £175k repayable three years later with rolled-up interest. 41. There is not a separate pipeline of capital projects seeking loan funding. GBSLEP has used the Mezz Fund operated by Finance Birmingham over the last five years to invest loan funding into SMEs based in the LEP area for capital projects that will provide economic development outputs and outcomes such as new jobs, commercial floorspace, homes, etc. Finance Birmingham has advised recently that there is currently a demand
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
from SMEs in the LEP area for loan funding to support capital investment, and that a fund of £2-4m pa could be invested by them on the LEP’s behalf over the next two years.
Investment Options and Potential Returns 42. The following options have been considered for investing the currently available funding balances over the next two years: • Option 1 – all invested in capital project grants • Option 2 – all invested in capital project loans • Option 3 - £1.7m invested in un-funded revenue projects, the balance invested in capital project grants • Option 4 - £1.7m invested in un-funded revenue projects, the balance invested in capital project loans • Option 5 - £1.7m invested in un-funded revenue projects, the balance invested equally in capital project grants and capital project loans 43. There are many other options that could be considered including capital project repayable grants with no interest income, but these five options should provide a good range of the possible financial and outputs/outcomes returns. 44. There are several factors to consider when assessing the best use of the available funding, financial returns, outputs/outcomes, political considerations. 45. The potential financial returns are summarised as follows: Options 2021/22 2022/23 Total £000 £000 £000 1 – all invested in capital project grants 0 0 0 2 – all invested in capital project loans 355 710 1,065 3 - £1.7m invested in un-funded revenue projects, 0 0 0 the balance invested in capital project grants 4 - £1.7m invested in un-funded revenue projects, 270 540 810 the balance invested in capital project loans 5 - £1.7m invested in un-funded revenue projects, 135 270 405 the balance invested equally in capital project grants and capital project loans
46. The assumptions made in estimating the returns on each of these options are: • Maximum forecast grant and loan spend made in 2021/22
• Investment returns in 21/22 based on 6 months to invest hence only 6 months interest income
• Loan investments made through lower risk GPF loans and higher risk Mezz Fund loans - average return 10%pa
• Operational costs of managing projects funded from available funds at 2.5%
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
47. The potential outputs/outcomes will of course vary for each project, but as a guide, the following are the projected outputs/outcomes for some pipeline GBSLEP capital grant funded projects and some completed capital loan funded projects: Capital Project Grant/Loan New New Jobs New Brownfield Grant Value value Homes Created/ commercial land funded £000 Safeguarded floorspace regenerated £000 projects Open 2,870 1,910 19 1,055m2 House – The Rep M&P 28,200 1,700 190 8,088m2 Hometel Tyseley 400 180 0.6ha Incubator for Clean Energy, phase 2 Hippodrome 9,000 5,500 650 Access All Areas, phase 2
Capital Loan Interest Grant/ New New Jobs New Brownfield funded projects Loan Homes Created/ commercial land value Safeguarded floorspace regenerated £000 Mezz Fund – 16.2% 1,300 90 Hills (LEP share 50%) Mezz Fund – 10.4% 2,000 140 0.86ha GJLP (LEP share 50%) GPF Loan – 6%pa 3,467 200 1,600m2 North Arran Way GPF Loan - 4%pa 900 250 430 HooBrook GPF Loan - 3.25%pa 2,000 69 70 1,115m2 Upwards
Recommendations 48. There will be many different priorities to be considered for the investment of the available funding balances, depending on the shape, size and governance of the LEP this year and going forwards, and on the local economic requirements across the LEP area to support the survival of businesses given the impact of the continuing COVID-19 pandemic.
Item 8 – Appendix 1 (As presented to Finance Working Sub-Group as Item 4 Appendix 1)
49. On this basis, the Finance Working Sub-Group is asked to consider the available funding balances forecast to exist in the next financial year, the investment options outlined above and to make recommendations to the Board on how to spend the funding balances.
Conclusion
50. GBSLEP has a number of funding balances that require the Board to decide what they should be spent on. 51. There are a number of different investment options that need to be considered. 52. The Finance Working Sub-Group is asked to consider these investment options and to recommend to the Board what the forecast funding balances should be spent on.
Report by: Kate Shaw Chief Operating Officer
Contact: [email protected] 07860 906438
Date Created: 26 March 2021
Appendix 1 The Growing Places Fund and Mezz Fund Overview
Appendix 2 Capital Projects Pipeline
As presented to Finance Item 8 - Appendix 2 Working Sub-Group Item 4 Appendix 2
Project Total Grant Funding Expected Project Outputs and Outcomes Project Name Stage of Development £m £m (where known) 1,055sqm Floorspace; FBC (Approved with BCR 10.5 FTE jobs (direct); 1 Open House, The REP 2.87 1.76 of 2.95) 8.4 net FTE jobs (indirect); Net additional GVA of £0.65m pa FBC (submitted and ITE in 2 Hagley Road Sprint Phase Two 10.00 3.40 TBC progress) Tyseley Incubator for Clean Energy FBC (submitted and ITE in 3 0.40 0.18 0.6ha Floodplain reclaimed (Phase Two) progress) 180 Apprentices; FBC (submitted and ITE in 4 Creative Alliance Digital Learning Hub 0.05 0.03 120 Kickstart Placements; progress) 150 Adult learners
5 Unlocking Stalled Housing programme FBC (to be submitted) 100.00 9.00 800 new homes (TBC)
8,088sqm Floorspace: M&P Hometel FBC (Approved with BCR 62 FTE jobs(direct); 6 Nb project has also been submitted to 28.20 1.70 of 1.7) 127 FTE jobs (indirect); BCC for the Levelling Up Fund £26.5m Private sector leverage Westbourne Road Campus – BCU City 4,750sqm learning space; South FBC (submitted and ITE in 1,488 new learners; 7 31.78 15.00 Nb project has also been submitted to progress) BCC for the Levelling Up Fund 312 FTE jobs
A457 Dudley Road Improvement Scheme FBC (submitted and ITE in 8 Nb project has also been submitted to 29.94 16.81 TBC progress) BCC for the Levelling Up Fund Continuation of existing TBC depending on the amount of GBSLEP 9 Mezzanine Loan Fund TBC TBC approved GPF scheme funding approved
10 Grand Union Phase Two OBC (FBC due) 1.30 0.50 TBC
11 Old Print Works Phase Two OBC (FBC due) 0.20 0.18 TBC
262 FTE (direct); Hippodrome Access All Areas Phase 12 OBC (FBC due) 9.00 5.50 389 FTE Jobs (indirect); Two GVA (GBSLEP) £45.0m
Tyseley Incubator for Clean Energy 13 EoI 2.00 1.00 TBC (Phase Three)
790sqm Office Floorspace; The Place that Made the Weather: 14 FTE jobs (direct); 14 EoI 8.60 0.78 Joseph Chamberlain Highbury 15 FTE jobs (indirect); 5 Apprenticeships 300,000sqft floorspace; 15 Nikal smART District EoI 300.00 TBC New jobs (no. tbc); New homes (no. tbc) Total 524.34 55.84
13/05/202116:49 Appendix 2 GBSLEP Fund Balances Investment Options.xlsm Item 9a
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING 10th June 2021 GBSLEP Approach to Impact Assessment and Evaluation
Recommendation
Board Directors are asked to:
I. Note and comment the approach outlines in this report. II. Endorse the proposed next steps.
Background
1. It is important that GBSLEP can understand the effectiveness of its activities so it knows whether it is achieving its mission to support inclusive economic growth. This understanding is gained by a process of monitoring and evaluating the impact of the LEP’s activities.
2. GBSLEP routinely evaluates the performance of its programmes and activities, reporting this through the appropriate governance structures. It has published Annual Review reports and promotes its many successes through a range of communications channels. Many of its sources of funding either from Government or Europe require regular and robust reporting back in relation to the performance of the project against agreed objectives.
3. More recently the Board has expressed a desire to understand what works and what difference the programmes and interventions it has supported has made. This is as opposed for example to simply how many people or businesses have accessed a particular programme, service or fund.
4. The evaluation of the LEP’s activities overall does not appear to have been consistent either terms of the breadth or approach taken. Where evaluation has happened, reporting to the Board may not have been as useful as it could have been and it is not always clear where feedback has translated into lessons for the future. In addition some of the reporting that has been carried out to date has focused on the outputs of activity rather than whether wider objectives or outcomes have been achieved. Even where reporting focuses on outcomes these are seen on a project by project basis and a more strategic perspective on the direction of travel or wider performance may be missed.
5. Given the purpose of the LEP is to support inclusive economic growth it is also important that both the Board and Executive understand the extent to which its programmes are reaching and impacting all of the region’s diverse communities – both as businesses and individuals. And, to what extent are issues of inequality across our region being addressed? Are we helping to level up?
6. GBSLEP invests considerable resources in challenging, shaping and evaluating business cases for projects based on securing specific outcomes. Having done this the LEP needs to be assured that once the project is in delivery and then complete, project sponsors and those in charge of delivery are held to account to deliver the agreed outcomes.
Current approaches to evaluation
7. The Board will of course be aware of the various forms of performance reporting and evaluation it already receives. Elsewhere on this agenda there are the following reports which are either partly or entirely focused on performance or evaluation of some kind or other:
• 2020/2021 Q4 and year end performance in relation to the delivery plan • The final evaluation of the Innovation Pilot. It includes both quantitative and qualitative data as well as lessons learnt from the programme which can be applied to future similar proposals. • The EZ and Growth Programme updates. These include details of spend performance against profile, progress with projects that have been funded under both of these programmes including securing the outcomes promised at the point of the initial funding decision. The reports also include the details of how the performance of new projects will be understood and evaluated. • An update on progress towards the Plan 10,000 skills project. • Project Review. On this agenda the focus of the review is the investment in the Grand Hotel. Board members will recall that there have also been similar reports on the Unlocking stalled Housing and Symphony Hall projects.
8. While all of these reports contain useful information there is an opportunity to improve the way we understand the performance of our activities as a whole, as well as for example on key cross-cutting issues.
New Approaches to Evaluation
9. In response to the above and suggestions made at the LEP Board as well as the Recovery Taskforce, the Executive is reviewing its approach to the evaluation of the impact of the LEP’s activities. Consideration has therefore been given to what a fresh approach to understanding the impact of the LEP’s work might look like. This would be in part to complement existing reporting and evaluation activity and partly to provide additional perspective. 10. GBSLEP has the benefit of access to the resources of WM REDI with whom this has been discussed. In the light of these conversations it is proposed that a continuous evaluation approach is developed and trialled for the next 12 months, with a quarterly update to Board on the findings.
11. The findings from the evaluations can be used to understand strengths and weaknesses of current programmes in relation to priority areas and sectors. They will inform current and future programmes through the identification of key success criteria. Success criteria and lessons learned from evaluations will be recorded and continuously assessed against programmes and processes to identify opportunities for improvement.
12. Recognising that there is already extensive effort in terms of reporting consideration has been given to how this activity could address some of the LEP’s strategic priorities from the Delivery Plan 2021/22. In the light of this it is proposed that the initial areas of focus for the evaluation are: a. Equality and Diversity b. Young People c. Green Recovery
13. As well as their importance to the LEP delivery Plan, these initial areas of focus have been chosen based on their alignment with the five State of the Region’s challenges: (1) Delivering Good Jobs; (2) Supporting Thriving Places and Communities; (3) Embedding our Green Ambitions; (4) Tackling Inequality and Levelling-up; and (5) Preventing a Lost Generation.
14. The proposal is that the evaluation will align past, current, and future programmes to these themes, identifying those that will provide the most meaningful insights. In order to develop these themes it is necessary to identify a range of questions which will form the foundation of the research. The suggested questions are set out below and the Board’s view is sought on their appropriateness etc. a. Strategy of Intervention - What did we set out to do and what did we do? i. What was the strategy for the intervention and intended outcomes? ii. How far were intended outcomes achieved? iii. If not why? iv. What else was achieved? v. What was the overall budget and expected outcomes at the beginning of the financial year? vi. What was the actual spend at the end of the financial year? vii. What were the variances and what can we learn from them? viii. What was the delivery structure?
b. Process - How well did we do it? i. What was the overall level of satisfaction with the process by our partners? ii. Did the targeted organisations participate as expected? If not, why? What lessons can be learned? iii. Demographics of partners and beneficiaries of programmes: Were there over or under representation in some groups? iv. How was the funding opportunity perceived by partners– appropriate/ valuable?
c. Impact - What difference did we make? i. What was the intended short-term, medium-term and longer-term impact of the intervention? ii. Who, what were the targets for the intervention? iii. What was the actual impact of the change/ what would be different now had the intervention not been delivered? iv. What further outcomes are expected in the future as a result of the intervention?
Resources
15. The proposal is that the approach is developed and led through the GBSLEP Programme Delivery Office within existing resources. The LEP has also recently seconded two Research and Intelligence Manager(s) on secondment from City-REDI. These are equivalent to 1 x Full time resource - who will support this activity along with additional input from WM REDI. As the work has been scoped in part for reflect the State of the Region’s 5 Challenges the WM REDI resources is also able to be provided at no cost to GBSLEP.
Recommendations and next steps.
16. The work is in its very early stages and so the Board is asked to comment on the principle of the approach to this additional level of evaluation and particularly the questions set out under para 14. It is recommended that in the light of these comments a project plan is developed and implemented to establish clear objectives and milestones for this work. An initial quarterly report will be brought back to the Board for comment as soon as possible.
Conclusion
17. GBSLEP already undertakes extensive evaluation of the performance of its projects and programmes. However, it is considered that there is room for improvement particularly in relation to how it performs against its cross-cutting priorities in para 12 and in terms of its understanding what works and what makes a difference. The approach outlined in this paper sets the basis of an approach which seeks to address these weaknesses.
Report by: Ed Watson Interim Chief Executive
Contact: [email protected] Mbl: 07483 078447
Date Created: 20 May 2021
Appendices
Item 9 b
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING 10th June 2021 Innovation Pilot Programme Evaluation
Recommendation
Board Directors are asked to:
1. Note and comment upon the findings of the Final Evaluation Report on the GBSLEP Innovation Pilot Programme.
Background
2. In response to a report commissioned in 2018 by the GBSLEP, suggesting a market challenge-based approach is a suitable method to encourage innovation amongst SMEs, the Innovation Pilot Programme was developed. The programme commenced in September 2019 and concluded in January 2021.
3. The programme design consisted of three components:
. 5 x Challenge Events delivered as workshops targeted at 100 SMEs. . One–to-one follow up consultancy support (4 days) for 10 selected SMEs. . A grant of £5,000 for the 10 selected SMEs, to be used to support investment in the SME’s planned innovation.
The programme was delivered by two separate contractors. Midlands Aerospace Alliance (MAA) managed Transport Technologies, Health & Life Sciences and Low Carbon. EXO Projects managed Advanced Manufacturing & Engineering and Business, Professional & Financial Services.
Evaluation
4. The GBSLEP appointed Wavehill to evaluate the pilot; 4 reports were provided.
1) Implementation Report, October 2019 2) Innovation Challenge Event Report, May 2020 3) Delivery Stage Report, February 2021 4) Final Evaluation Report, April 2021
5. Wavehill attended the Challenge Events to observe and provide feedback. In addition, 22 interviews with programme participants were undertaken after the event.
6. To complete the Delivery Stage Report and Final Evaluation Report, Wavehill conducted interviews with all SMEs on the programme, delivery partners, and the GBSLEP Executive; feedback was generally positive. The final evaluation interviews Item 9 b were due to take place following completion of the programme, however due to delays in its delivery, this aspect was brought forward to accelerate completion.
7. Appendix B is the Final Evaluation Report provided by Wavehill, which outlines the effectiveness of the Innovation Pilot Programme.
Key Findings
Outcome and Impacts
8. Grant Design: Fundamentally, the evaluation stated that the design of the grant aspect of the programme was not fit for purpose. It highlighted that the programme was unable to stimulate innovation in the high-growth SMEs that were initially targeted. The value of the grant supplemented with business support was most appealing to early-stage SMEs. The more established SMEs were not attracted to such a low grant value as it was insufficient in enabling them to pivot their products/services.
9. Key Sector Focus: With only 10 SMEs able to be supported by the programme, the focus on GBSLEP’s key sectors was considered somewhat inappropriate for the scale of the project. A focus on overlapping themes such as ‘Low Carbon’ or ‘Digital’ may have been more appropriate.
10. SME Impact: The general feedback from participants was positive. The programme offered support, enabled new network connections and increased confidence and improvements to business plans. From the 10 SMEs selected for the programme, 9 submitted successful applications for the £5k in grant funding, though one SME later withdrew. The grant was generally used to fund product development or market research. Half of the SMEs reported that they would not have been able to undertake this activity without the grant, illustrating the value of the pilot.
11. Business Experience: Several participants highlighted issues with the administration of the programme and a lack of clarity between the role of the LEP and the Delivery Partners. This resulted in participants communicating with both the LEP and Delivery Partners at the point of grant awards and agreements; creating some confusion over who was responsible for the overall administration.
Programme Management and Delivery
12. Programme Management: The evaluation report pinpointed a lack of clearly defined roles between the GBSLEP and the Delivery Partners. At times this led to confusion and inefficiencies in the management and administration of the programme.
13. Impact of COVID-19 and Staff Turnover: COVID-19 delayed the delivery of the Innovation Pilot Programme and the subsequent innovation by the SMEs. Claims for grant payments were significantly delayed. However, some participants found the extended period did provide them with extra time to consider their innovation activity. The GBSLEP’s staff turnover throughout this period also impacted the delivery of the programme, as points of contact changed.
14. Delivery and Scope: Two Delivery Partners were commissioned to deliver the programme, as opposed to one organisation as initially defined in the tender document. MAA offered a presentation style workshop, whilst EXO Projects provided a more hands-on approach, working with participants to define their innovations. Item 9 b
15. Recruitment and Attendance: Although it was the responsibility of the Delivery Partners to recruit participants as part of their contract, workshop attendance was low;33 out of a target of 100 SMEs attended. It could be argued that timing was a contributing factor; Brexit was distracting SMEs considering innovation and a number of SMEs reported being unclear as to what to expect from the workshop activities. This suggests that the marketing material used for the sessions was not always successful in conveying the purpose and content of the events. There was the suggestion that the Growth Hub and the GBSLEP could have given more support to increase workshop attendance, given the network and marketing reach of the GBSLEP’s channels. Furthermore, the Challenge Events received a mixed reception from the surveyed SMEs who did attend. Whilst they were generally positive about the content, SMEs felt that there could have been better organisation and greater clarity on the process of the pilot and what was to be expected from the sessions.
Recommendations
16. The Final Evaluation Report recommends increased collaboration and knowledge sharing between Delivery Partners and the GBSLEP. Future programmes must better define how they are trying to stimulate innovation among SMEs. Better utilisation of the GBSLEP’s resources to improve the reach, delivery and available support from future programmes is also advised, such as a Specialist Innovation Officer at the GBSLEP. Future programmes may benefit from greater engagement and input from industry experts, to ensure that the core concepts that the programme is striving to deliver, are fully aligned with the design of the programme. The GBSLEP Business and Innovation Pillar Board and GBSLEP’s industry led sector groups are well placed to provide this input and contribute towards programme design in the future.
Conclusion
17. The original Optimat report commissioned by GBSLEP in 2018 identified a demand led approach as a suitable method to be employed in a pilot project to encourage innovation among SMEs. The use of intermediary innovation experts was also highlighted as well as the need for cross sector and supply chain collaboration.
18. Wavehill have provided an ongoing evaluation of the GBSLEP Pilot Innovation Programme. This paper provides a summary of the research findings from the Final Evaluation Report.
19. The Innovation Pilot Programme has been beneficial to its participants. But there are important considerations and recommendations that have been highlighted by the Final Evaluation Report that the GBSLEP will take into account when designing future programmes. The learning from this pilot has highlighted a number of suggested interventions for moving forward with innovation support in the GBSLEP area.
Report by: Mike Folkard Head of Business and Innovation Strategy
Alex Taylor Senior Policy Officer
Item 9 b Contact: [email protected] Mob: 07483 078445 [email protected] Mob: 07483 076145
Date Created: 18th May 2021
Appendices A Innovation Pilot Programme: Theory of Change B GBSLEP Innovation Pilot Evaluation Final Report, April 2021
APPENDIX A: Innovation Pilot Programme: Theory of Change
Rationale GBS LEP has identified Innovation as a key driver for productivity and growth in the region with evidence suggesting that levels of innovation are low in the West Midlands. Evidence from the UK Innovation Survey, Regional Innovation Scoreboard and National Statistics reveal innovation gaps between the GBS LEP and benchmarks.i Innovation overall is 8% below the best performing LEPii while R&D expenditure in the West Midlands is 2% of GDP, average for the UK but below the Industrial Strategy target of 2.4% by 2027.iii Lifelong learning is 18% below the UK average.iv GVA per hour shows there is a productivity gap of 8.7% between the West Midlands (NUTS2) and the UK with Birmingham similarly 8.1% below the UK average.
There are opportunities for the GBS LEP to improve its productivity with the region possessing strong manufacturing, science and technology sectors as identified in the regional Science and Innovation Audit.v Recognising the challenge of the traditional supply led model, a report proposes a demand led innovation programme for GBS LEP which has been adopted as the Pilot Innovation Challenge.vi
Objectives Inputs • To pilot approaches to demand-led innovation in key target sectors (Advanced Manufacturing & Engineering • £163,500 in GBS LEP funding for the programme (AME), Health & Life Sciences, Business, Professional & Financial Services (BPFS), Low Carbon Environmental • Expertise of contracted delivery partners EXO Project and MAA Technologies & Services) • £50,000 in grant funding available (potential for up to £5,000 for each successful business) for further business • To understand the value of involving industry bodies in delivery support • To increase SME awareness and understanding of demand led innovation opportunities • Management, delivery and promotion support provided by GBS LEP • To foster and encourage collaboration and innovation among SMEs • To increase productivity, competitiveness, turnover and employment for SMEs in the GBS LEP Activities MAA LEP 1. 3 challenge setting events with industry leads and experts Management of the pilot 2. 3 demand led innovation challenge events for Transport Technologies, Health and Life Sciences, and Low Carbon Environmental Technologies Promotion and marketing 3. Innovation surgery sessions at the challenge events Data collection, monitoring and evaluation 4. 15 SME project proposals submitted responding to the challenges set 5. 6 projects selected by the steering group (these might not be evenly divided between the 3 challenges) 6. 4 days of business support tailored to the needs of the SMEs projects (potential to use £5k in funding for further external support) EXO Project 1. 2 events for Advanced Manufacturing & Engineering, and, Business, Professional & Financial Services over 2 days each 2. SMEs submit a short business plan with 2 competitively selected by EXO Projects and GBS LEP 3. A face to face meeting with an innovation expert and follow on telephone support as required (potential to use £5k in funding for further support) Outputs Outcomes 1 Outcomes 2 Outcomes 3 Impacts • Approximately 100 SMEs attending • Increased confidence, attitudes and • Increased R&D spending • Increased productivity and efficiency of • Increase GVA/Output in GBS LEP challenge events (20 per event) skills in innovative practices • New working/production processes SMEs • Increased efficiencies of supported • 10 SMEs receive additional innovation • Increased awareness of demand led introduced to business • Turnover growth businesses business support and brokerage to innovation support • Increased number of new to market • Employment growth • Advancement of an innovation further business support • New SME collaborations and products ecosystem in the GBS LEP and WM • Up to 10 SMEs receive grant funding of partnerships • Increased number of new to firm areas up to £5k • Changes in time spent on innovation products • Potential for a continuation of the pilot Process into a demand led innovation • Fully tested pilot programme programme for SMEs in the GBS LEP • Design, approach, management and governance insight for the GBS LEP area • Evidence base for future programmes • Strengthened business support offer for innovation in GBS LEP
APPENDIX A: Innovation Pilot Programme: Theory of Change
Assumptions Barriers Risks • Providers are able to engage sufficient businesses in the target sectors • Available resources may restrict the effectiveness of the pilot • Providers are not able to lever in support from their networks to participate in the pilot • Lack of suitable SME businesses in the marketplace and/or target • Crowded marketplace for innovation support programmes leading to • SMEs with aptitude to innovate attend the challenge events sectors fatigue of target businesses and reduced attendance • The events generate innovation opportunities • Awareness in the market and among SMEs of innovation opportunities • Challenges are not suitable for the attending SMEs leading to: • The events catalyse collaborations is low - Inadequate business responses to the challenge events • Businesses value and gain a return from the support provided • The administrative burden of accessing grant funding could be - Responses to challenge events are of a low quality generating outcomes prohibitive • Businesses do not invest or respond to the innovation support received • Innovation support relevant to the selected businesses/individuals can • Time constraints on businesses • Cross over of sectors and SME capabilities to respond to multiple be provided • Low capacity within the SMEs to advance with their proposed challenges • Responses by SMEs do not already take place in the market challenge responses • Support lacks relevance to participant businesses needs • Support is sufficient to enable SMEs to bring innovative products or • Expectations from businesses may not match the capacity of the • Pilot interacts with businesses already innovating heightening the risk services to market limited resources available from the pilot of significant deadweight • Geography of the pilot limited to the GBS LEP may reduce numbers of • Lack of legacy from the pilot leads to a loss of momentum potential SMEs (especially as MAA operates over WM) • Challenges of measuring progress towards innovation without tangible products or services Enablers • Procurement of appropriate delivery partners • Effective penetration and marketing of the programme to targeted businesses by delivery partners (EXO Projects and MAA) • Clear communication and cooperation between the partners • Challenge setting events for MAA strand allow development of appropriate challenges • Identification of challenges in the EXO Project strand allows creation of appropriate challenges • Selected projects/SMEs are brokered or provided with the most appropriate support for their needs • MAA presenting other two challenges at each challenge event to allow cross-project working where it might be beneficial for the businesses involved
i Business innovation, diffusion and productivity in the West Midlands, S. Roper, Enterprise Research Centre, 2018 ii UK Innovation Survey, BEIS, 2015 iii Intramural R&D expenditure (GERD) by sectors of performance and NUTS 2 regions, ONS (Eurostat), 2016 iv Regional Innovation Scoreboard, European Commission, 2019 v A Science and Innovation Audit for the West Midlands, SQW, 2017 vi Interventions for Increasing Business Innovation in Key Growth Industries, Optimat, 2019
GBS LEP Innovation Pilot Evaluation Final Report
April 2021
Wavehill: social and economic research
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Report authors: Declan Turner Oliver Allies
Any questions in relation to this report should be directed in the first instance to Declan Turner ([email protected])
Date of document: April 2021 Version: Draft
Client contact: Alex Taylor | [email protected]
Contents
Contents ...... i Table of tables ...... i 1 Introduction ...... 1 1.1 Background ...... 1 1.2 Pilot Approach ...... 1 1.3 Evaluation Methodology ...... 2 2 Rationale ...... 3 3 Operation & Delivery ...... 5 3.1 Management & Governance ...... 5 3.2 Implementation ...... 5 3.3 Challenge Events ...... 6 3.4 Delivery ...... 7 4 Outcomes ...... 9 4.1 Impacts ...... 9 4.2 Case Studies ...... 11 5 Key Learning ...... 15 6 Future Delivery ...... 17 6.1 Wider Learning ...... 17 6.2 Intervention Options ...... 18 7 Conclusions ...... 23 Appendix ...... 25 Theory of Change ...... 25
Table of tables
Table 4.4: Theory of Change Outcomes Review ...... 10
GBS LEP Innovation Pilot Evaluation Final Report Executive summary
The Greater Birmingham and Solihull (GBS) LEP Innovation Pilot looked to explore whether demand-based challenge events could be used to stimulate innovation among local SMEs and help respond to market needs. The pilot followed research conducted by the LEP suggesting this might be an opportunity for high impact business support and respond to the challenges of low productivity reported in the Local Industrial Strategy for the West Midlands and other policy documentation. Starting in August 2019, the pilot was delivered by two appointed providers, the Midlands Aerospace Alliance and EXO Project, and evaluated by Wavehill. This is the final report of the evaluation and summarises the findings and outcomes from the pilot.
Pilot Approach The two delivery providers had five sectoral themes to focus on, aligned to the GBS LEP priority sectors. For each theme, a challenge event was envisaged where industry stakeholders would present the issues currently facing their operation or the market providing opportunities for groups of attending SMEs to respond to. These SMEs could provide a short proposal in response to the one of the challenges posed which would be reviewed and two for each theme competitively selected. These selected businesses would then receive four days of business support from their delivery provider and given the opportunity to apply for a small £5k grant from the LEP to help get further support to facilitate the project proposal.
Evaluation The evaluation began by developing a theory of change for the pilot and subsequent evaluation framework against which the outcomes and learning from the pilot would be assessed. During the challenge events, the evaluation team observed the sessions and surveyed the attending businesses following each event. A series of interviews were held with the ten selected businesses and the delivery partners during the latter stages of the pilot to gather evidence and feedback on the processes and impact. Further discussions were held with the LEP to explore challenges and successes and then disseminate the findings.
Process Findings As the pilot was delivered several challenges emerged which had repercussions for the remainder of the pilot and its success. Only 33 SMEs attended the challenge events which was far below the target of 100, and both delivery providers struggled to galvanise the interest they had expected. More collaboration between the partners and LEP to use the resources of the latter and longer lead in times to market the pilot may have helped prevent this. A large amount of existing business support provision in Birmingham and the West Midlands, some within the innovation sphere, may have contributed to this low participation.
The lower volume of attendees restricted the opportunities for selecting participants at the next stage and was compounded by the second restricting factor which was the scale of the businesses who did attend (nearly all were micro and most were start-up or pre-start businesses). The grant amount may also have contributed to the size of the attending firms as £5k is not very substantial to attract larger organisations. It had been assumed by the pilot that the businesses who attended would be able to identify the opportunities presented by
i GBS LEP Innovation Pilot Evaluation Final Report the industry at the events and pivot some of their operation to tackle this market opportunity. In reality these businesses were already innovative and had their own ideas which they were seeking to validate or scale, lacking the resource capacity to pivot to respond to the challenges if they were a departure from their existing business ambition.
EXO Project’s events were closer to workshops by design having recognised that it was about facilitating innovation within the businesses and these were well received by the business who participated whereas the MAA sessions were not so well aligned. The MAA format was in keeping with the original approach stipulated by the LEP. Organisation and communication issues were also reported by businesses attending both delivery partners events.
The successes of the pilot started to emerge during the delivery of business support to the ten selected firms who generally felt this to be beneficial despite the outbreak of Covid-19 causing disruption. As businesses moved towards applying for grants some process challenges emerged, starting with communication between the LEP, the delivery partners and the supported businesses who up to this point had been kept at arm’s length from the LEP. Additional administrative requirements of the delivery partners were also required in supporting the applications that the delivery partners had not expected. However, the flexibility of the support and the knowledge of the various providers helped to generate outcomes for the businesses, such as network connections, increased confidence and revisions to business plans. Time spent on innovative activities increased and there were operational improvements reported by the companies. Testing quantitative impacts of the pilot was challenged by the Covid-19 pandemic and that the adverse effect this had on these firms that was not possible to control for. For most firms the support and grant had helped to accelerate their development as start-up organisations.
Key Learning While the programme had some benefits and was successful in parts, the important outcomes are the learning it provided for future provision.
Better use of collaborative learning between the LEP and the two delivery partners could have been encouraged to ensure that all parties were able to take the most out of the pilot and improve as delivery was ongoing. For the most part this was not encouraged by the LEP, where managers treated the pilot as a task and finish project where they were testing the differences between the two delivery models adopted by the partners. The fact that the LEP was not clearly identified early, and then were involved in business selection and grant award later also contributed to the communication issues experienced by businesses when dealing with the pilot, particularly where delays emerged around issuing grants.
The focus on GBS LEP priority sectors was inappropriate for the scale of the pilot and the businesses who engaged. Start-up firms were unlikely to pivot in response to challenges due to their existing business ideas, but they were going to face even more of a struggle in sectors such as manufacturing with high barriers to entry, or exceedingly broad such as transportation. Digital technology that cuts across all sectors and can create disruptive innovation market solutions may have been a better focus.
ii GBS LEP Innovation Pilot Evaluation Final Report
Fundamentally, future innovation programmes need to consider whether they are trying to stimulate innovation among established businesses, or supporting already innovative, market disrupting businesses to grow and succeed. This pilot has shown that whilst the former may be a good ambition, the businesses who participated were more aligned to the latter and there already exists and extensive amount of support for such businesses within Birmingham and the West Midlands.
Future Delivery As well as refining the pilot approach based on this learning, there are other options that could be used by the LEP to encourage innovation in future. One would is to make use of the Growth Hub or having a designated innovation officer within the LEP who can provide the networks and connections that many smaller businesses need to innovate and scale. Many of the businesses would have welcomed peer to peer networks or support, and in the experience of Wavehill working on other programmes, this can indeed be a successful route to supporting businesses. Some of the successful outcomes of the pilot were where businesses had been referred to potential partners or funding opportunities. There may also be space for offering smaller grants to support innovative firms in developing their products or services at low and middle Technology Readiness Levels, helping to prime and facilitate such firms to grow.
Other options include delivering a demand led programme based on more structured cohorts of supported businesses and working closely with industry to develop challenges. This could be based on a stage gate model, where different levels of business support are offered to businesses as they are selected to progress on to the next stage. However, such structured support would be operating in a crowded ecosystem of business support locally. Similarly, a programme to help the innovative start-up firms to succeed with their own ideas might be suitable given the demand from such businesses demonstrated by the pilot, though availability of other support may be a challenge. Finally, following the EXO Project model of supporting businesses to become more innovative may be successful in helping organisations that might have become sluggish to become more productive, though identifying and accessing such organisations could present difficulties.
iii GBS LEP Innovation Pilot Evaluation Final Report 1 Introduction
Greater Birmingham and Solihull Local Enterprise Partnership (GBS LEP) developed a demand led project to pilot innovation support to local businesses. The pilot ran from August 2019 to the winter of 2020, supported by two contracted delivery providers and evaluated in stages by Wavehill. This report provides the culmination of the evaluation findings and assessment of outcomes and sets out recommended adjustments that could be made for future projects, based on Wavehill’s experience and the lessons learnt from the pilot.
1.1 Background
Innovation, particularly among smaller businesses is a recognised barrier to economic development in the UK, limiting productivity and growth. In response, the GBS LEP looked to develop a support programme that would help generate innovation among smaller firms in the LEP area. The design of the subsequent pilot followed research commissioned by GBS LEP that identified demand led challenges as the most appropriate means to stimulate innovation in the area.1 By responding to industry challenges, SMEs could provide innovative solutions with immediate supply chain impacts which would enable them to grow while having wider innovation spillover effects.
1.2 Pilot Approach
The pilot was consequently designed to target 100 SMEs across five thematic sector areas aligned to the opportunity areas of the LEP. These were Transport, Health & Life Sciences, Low Carbon, Advanced Manufacturing & Engineering, and Business, Professional & Financial Services. After specifying the pilot structure, GBS LEP contracted the delivery of the content to two delivery partners, EXO Project and a consortium from the Midlands Aerospace Alliance (MAA). A challenge event workshop was to be delivered for each theme in which the attending businesses would be given details and insight into challenges faced by sector stakeholders and large market players that could serve as innovation opportunities.
Following the challenge events, the attending businesses would be invited to submit business cases for projects that responded to the challenge areas posed. The expectation was that ten businesses would then be selected (two from each theme) to receive additional intense support from the delivery providers to respond to the challenge and apply for a £5k grant from the LEP to support them in undertaking the refined project.
Having initiated these projects, some of the businesses would then recognise the opportunity through further development of the product or service to capture the market and commercialise the benefits. The learning and knowledge from the support and the experience of conducting such a project would improve the attitude and levels of innovation among these businesses. With further refinement, it was hoped that the programme could be scaled to provide a rolling innovation support initiative with cohorts of SMEs innovating within GBS LEP.
1 Interventions for Increasing Business Innovation in Key Growth Industries, Report and Recommendations to GBS LEP, Optimat, July 2019
1 GBS LEP Innovation Pilot Evaluation Final Report
1.3 Evaluation Methodology
As the evaluation ran alongside the delivery of the pilot and was able to observe the challenge event sessions and capture information from the businesses and delivery partners during the operation, a unique insight into the operation of the pilot was achieved. Split over three distinct phases, the evaluation reviewed the implementation of the pilot, the challenge events and the delivered support for the successful innovation projects.
The implementation phase involved a review of the management and governance in place for the pilot, the busines plan and pilot ambitions, and rationale for the pilot. Interviews with the GBS LEP project team and the appointed suppliers, MAA and EXO Project, were used to support this phase of the evaluation alongside desk research on the pilot documentation and supporting literature. As well as setting out these findings, the implementation report included a detailed theory of change and evaluation framework for the pilot which provide a guide against which the outcomes and successes of the pilot are determined.
The challenge event phase assessed the challenge events themselves through observations of the events by the evaluation team and a survey of some of the attending businesses. In addition to capturing insight and feedback on the quality of the challenge events, the information from the survey provided a baseline of the supported businesses and their performance, challenges and expectations of the innovation pilot. The survey responses and observations of the challenge event sessions provided recommendations and learning for the pilot that were fed back through the challenge event evaluation report. Comparisons were made to the theory of change for the pilot developed at the implementation phase to assess the extent to which the pilot was meeting its objectives and achieving the planned ambitions.
The delivery phase evaluation focused on the ten businesses who received additional support under the programme. Interviews were held with the project team at GBS LEP and the delivery partners EXO Project and MAA to support the findings of in depth interviews with businesses. The results of these discussions provided feedback on the effectiveness of the delivery and insight into the outcomes and impacts the support had had on the businesses themselves. The learning from all parties over this stage was reported in the delivery phase evaluation report alongside the reported impacts and benefits of the pilot.
The final evaluation looks to bring together the findings from the other phases and build on the recommendations alongside Wavehill’s experiences evaluating other demand led business support programmes to support the LEP in the future delivery of similar initiatives. Case studies have been developed from a selection of the supported businesses to provide clear insight into the ways in which the pilot has been received and the impacts that it has had on the organisations. Alongside the other impacts and outcomes reported by the businesses these are established below to show where the innovation pilot has generated benefits, expected or otherwise. A final comparison to the theory of change is made to demonstrate where the project has met its objectives or deviated from the original pilot proposal.
2 GBS LEP Innovation Pilot Evaluation Final Report 2 Rationale
Innovation is high on the priority agenda in the UK featuring as an important part of a raft of economic development policy, such as the Industrial Strategy2 and the new Build Back Better plan for growth,3 and initiatives such as Innovate UK and the Catapult Network. While major research and development funding is available which can help to stimulate new product innovation, challenges of accessing finance among SMEs, especially to test and commercialise innovations at higher technology readiness levels (TRL) are a major weakness. Further, innovation is more than just technological innovation, and can apply to process, systems and methods that do not have to be in cutting edge sectors. Innovation in these instances is often about leadership, skills and the confidence and understanding of how a business can innovate to become more efficient.
The West Midlands Local Industrial Strategy, which covers GBS LEP, also puts innovation at the centre of many of its responses to sectoral challenges and regional opportunities. It includes ambitions for a West Midlands Innovation Framework to consider how opportunities could be identified and maximised for regional impact and consolidate the bids for funding such as the Strength in Places Fund and others. Building an environment and fostering the skills and attitude needed to encourage innovative practices in the region will be key to effectively meeting some of the deficits the region and the nation face. Working across stakeholders and partnerships such as the Innovation Alliance for the West Midlands will be key to bringing the various contributory factors of innovation together.
When the pilot was initially considered the UK Innovation Survey4 identified an innovation gap in the GBS LEP of 8% below the best English practice.5 The latest figures show that in the West Midlands 38.7% of firms are innovation active (2016-18), a decrease from 52% in 2014- 16.6 Twenty-three percent of GBS LEP firms undertake new to the firm product or service innovation, 11% below the highest performing LEP. Only 13% of GBS LEP businesses undertake new to the firm process innovation compared to 26% in the highest performing LEP. New to the market innovation is even lower in the GBS LEP with only 7% of firms engaging in this type of innovation. The EU published Regional Innovation Scoreboard shows the West Midlands to be 18% below the UK average on lifelong learning.7 R&D expenditure in the West Midlands is 2% of GDP, average for the UK but below the Industrial Strategy target of 2.4% by 2027.8 Productivity, measured by GVA per hour shows there is a productivity gap of 8.7% between the West Midlands (NUTS2) and the UK with Birmingham similarly 8.1% below the UK average.9
2 Industrial Strategy, BEIS, 2017 3 Build Back Better: our plan for growth, HM Government, March 2021 4 UK Innovation Survey, BEIS, 2015 5 Business innovation, diffusion and productivity in the West Midlands, S. Roper, Enterprise Research Centre, 2018 6 UK Innovation Survey. BEIS, 2019 7 Regional Innovation Scoreboard, European Commission, 2019 8 Intramural R&D expenditure (GERD) by sectors of performance and NUTS 2 regions, ONS (Eurostat), 2016 9 GVA Balanced by NUTS Level, ONS, 2018
3 GBS LEP Innovation Pilot Evaluation Final Report
Delivering an innovation focused support programme was therefore considered a suitable initiative for GBS LEP with the anticipated benefits spreading to other areas such as productivity, start-up survival and competitiveness, and economic impacts such as job creation and increased Gross Value Added. Societal improvements as a consequence of the innovations may also be generated in the long run, particularly in some of the target sectors such as Transport, Life Sciences and Low Carbon.
Through this evaluation process it has been clear that the rationale for the innovation pilot was appropriate, just that challenges of matching this rationale to the participant businesses in some cases proved to be a barrier. Part of this comes from a lack of clear definition of what innovation means. As suggested before, the rationale for innovation is generally around product development, the investment finance needed to achieve this and typically for technology innovation. However, innovation can also stretch to attitudes and ways of working; indeed, it has been remarked that businesses rarely use the term ‘innovation’ in the way that it is used in policy and by the public sector. As shall be explored this has implications for the type of support that is delivered.
2.1.1 Covid-19
During the delivery of the pilot there was a fundamental change in the context in the UK as a consequence of the Covid-19 pandemic. Creating widespread economic challenges for organisations, the capacity of businesses shrank as they wrestled for survival. While there were some opportunities, with, for example, furloughed employees having time to test and develop that idea they’d had at the back of their mind, or starting the new businesses they had put off, the organisations in the innovation pilot were already engaged. The change in focus meant they had less time to commit to the pilot and as innovation support moved online there were implications for the delivery approach. This caused delays to the pilot which compounded earlier delays within the delivery of the pilot.
4 GBS LEP Innovation Pilot Evaluation Final Report 3 Operation & Delivery
This chapter will briefly cover the actual delivery of the innovation pilot and summarise some of the challenges and learning identified in the implementation, challenge event and delivery reports. For more details on each of the phases, see the independent reports.
3.1 Management & Governance
The pilot was managed by two officers from the LEP, one to provide strategic oversight and the other focused on the day to day operation. Overseeing the governance of the pilot was the LEPs sub-board for innovation chaired by the Board Director for Innovation which reported to the LEP board. A steering group was also set up which included input from the neighbouring Black Country LEP and representatives of the West Midlands Combined Authority to inform cross-LEP learning on the innovation agenda.
While this seemed appropriate, there were several challenges that would emerge from the management of the pilot. A key one was the treatment of the pilot itself as a task and finish exercise rather than a learning opportunity. The ambition to have the pilot completed, learning taken, and refined and, if suitable, full programme offered, overrode some of the opportunities for testing the development of ideas. Collaboration between the LEP and the delivery partners was minimal and, though closely overseen, MAA and EXO Project were left to design and deliver their different parts. While independence for delivery partners can be beneficial in programmes where experience of the partners may work well with maximum autonomy, as a learning pilot this seemed counterintuitive. Despite using two providers, the two were not encouraged to collaborate or share learning.
The separation of the LEP and the delivery partners then led to later challenges at the delivery stage when the applications for the ten businesses to receive additional support went to the LEP followed by the grant funding application. Several businesses were confused by the distinction and communication issues were generated as the delivery partner, who the businesses were familiar with, became the conduit between the businesses and the LEP which was not efficient.
Though the LEP considered looked to involve wider partnerships when setting up the pilot, with the Black Country LEP and West Midlands Combined Authority represented on the steering group, the project delivery involved no strategic partners. While as a pilot this made sense to simply test the operation, the opportunities to collaborate with the likes of the Growth Hub may have made recruitment on to the pilot easier (two points which will be addressed later).
3.2 Implementation
The implementation of the programme was delayed following the procurement of the delivery partners which changed from a single contract for one provider, to a shared contract split between two providers. Each of the providers had offered different approaches to fulfilling the delivery requirements of the innovation pilot and GBS LEP decided that testing
5 GBS LEP Innovation Pilot Evaluation Final Report each of these approaches may bring additional benefits. It was at this point that the different interpretations of innovation became clear, with MAA adopting a delivery approach in line with the original LEP specification which focused on technological innovation to resolve a challenge, while EXO Project identified that, for micro and small businesses, the innovation would be their own, and it was about encouraging the skills and leadership to achieve this.
While both partners were pleased to have been awarded the contract and be working on an interesting project, the reduction in the economies of scale from the split contract, meant there was some hesitation about the resource available, even at the early stage. By the end of the delivery, both reported that they had delivered the project at a loss.
EXO Project looked to use their challenge events (Business, Professional and Financial Services and Advanced Manufacturing and Engineering) as workshops where innovation skills and tools would be demonstrated and developed with attending businesses. This represented a departure from the original ambition of presenting industry challenges at the events, but correctly identified that the assumption that SMEs would be in positions to respond to these challenges separately from their existing operations was wrong. Smaller businesses would have their own innovative ideas and therefore needed to know how these could be built into a business or faced their own longstanding challenges that innovation could be used to resolve.
MAA designed challenge events around their theme areas (Transport Technologies, Health and Life Sciences, and Low Carbon Environmental Technologies) by narrowing the focus in challenge setting workshops with industry stakeholders. The challenges therefore focused on Air Quality for the Low Carbon Environment Technologies theme, Electrification for the Transport theme, and Social Care for the Health and Life Sciences theme, recognising that the LEP prescribed themes were too broad to develop refined challenges. A selection of opportunity areas were generated with the plan to pose these to the businesses in the challenge events.
3.3 Challenge Events
Two related factors impeded the success of the challenge events; the ability to attract businesses and subsequent number of attendees, and the scale of the attending businesses. The former challenge led to most of the 6 challenge events being postponed as both MAA and EXO Project struggled to generate the interest they needed to attract the targeted 20 SMEs for each theme or event. EXO Project, who had aimed to deliver 4 sessions with 10 SMEs each over their two themes, reduced one theme to a single session. Ultimately, 33 firms attended the six sessions from MAA and EXO Project, which were all hosted in central Birmingham, with several sessions only having two attendees.
The challenge associated with the scale of the businesses who were mostly micro or even pre- start had a profound impact on one of the underlying assumptions of the pilot. These businesses were generally not in a position to pivot their whole organisation or spare the resources to respond to the challenges as a separate project. Therefore, when it came to applications for the additional support, the businesses who responded to challenges did so by aligning it to their existing activities. The secondary consequence of being pre-start or
6 GBS LEP Innovation Pilot Evaluation Final Report micro, was that many of these businesses were already innovators of some description, having products or market disrupting ideas. Therefore, these businesses were misaligned to the MAA format, and in some instances looking to get business support to move their innovative idea forward (a valuable outcome) rather than receive training on how to innovate as under part of the EXO Project approach.
The role of the challenge events to provide demand led opportunities was also potentially compromised by the incentives that the £5k grant funding provided. The relatively small grant in the grand scheme of generating innovation likely led to the attending businesses being of a scale where £5k would have had far greater impact, compared to bigger firms. Other firms were motivated to attend the challenge events as opportunities to network, both with other businesses and also the industry stakeholders; again reflective of the size and nature of the attendees.
The challenge events themselves received a mixed reception from the surveyed businesses who did attend. While they were generally positive about the content of the events, businesses felt that there could be have been better organisation and greater clarity on the process of the pilot and what was to be expected from the sessions.
3.4 Delivery
After being invited to submit business case applications for projects under each of the thematic areas, ten organisations were selected by the delivery partners and the LEP to receive an additional four days of support. The application process was generally considered robust, and appropriate businesses were selected, though selection had to go beyond the scoring criteria to reflect qualitative factors. The process was greatly impacted by the outbreak of Covid-19 which changed the delivery method to online provision and led to delays and shifts of focus for the businesses. Furthermore, staff changes at the LEP meant that relationships changed as the pilot moved towards grant funding applications and new individuals had to become familiar with the delivery model, process applications and issue grants. There were reportedly long delays between the grant applications being submitted and the funding being awarded which had reputational risks for the LEP and can be challenging for SMEs, particularly those who are moving in fast paced sectors.
Other challenges were reported by the businesses associated with the application process, included a lack of clarity on the requirements, and the delivery partners found they were involved in a lot more administration and application processing than they had expected. When delivery commenced, some businesses developed strong relationships with the delivery partners and took a lot from the interaction. The move to digital provision changed some of the dynamic and meant it was hard to know if a full four days of support had been received, but the flexibility was seen as a benefit by most businesses and the delivery partners. The needs for the support though varied between businesses, with some able to benefit from intensely using their four days in a short space of time, while others would have been more suited to having this spread over several months or more. The limits of the pilot meant that offering this less intense but longer support was less feasible, though both partners said they would be willing to maintain informal relationships with their businesses into the future.
7 GBS LEP Innovation Pilot Evaluation Final Report
The nature of the support was flexible to the needs of the businesses which was reportedly successful and responsive. It ranged from updating business plans and strategies, offering specialist financial advice and providing an impartial sounding board against which project ideas could be tested. The businesses found this effective, but the nature of the support was wider than the innovation focus originally intended.
Nine of the projects submitted applications for the £5k in grant funding and were taken forward, though one later withdrew. The grant was generally used to fund product development or market research, and half of the businesses reported that they would not have done so without the grant, illustrating the value of the pilot. Further outcomes and impacts of the pilot are explored in the following chapter.
8 GBS LEP Innovation Pilot Evaluation Final Report 4 Outcomes
This section explores the outcomes achieved from the GBS LEP innovation pilot in more detail based on the evidence provided by the beneficiary businesses and interviews with the delivery partners.
4.1 Impacts
As explored in the challenge event report, the workshop sessions generated some impacts for the attendees. The survey respondents reported that they felt more confident and had a better understanding of what innovation could entail and how they could use the practical tools presented at the EXO Project events to develop their businesses. For the MAA sessions there was some raised awareness of demand led opportunities and better understanding of sectoral issues, but other outcomes such as networking and collaboration were seldom reported. The impacts of the challenge events were mostly qualitative and related to the skill development of the individual attendees, rather than any quantitative organisational outcomes. While it was not the aim of the events, where changes were brought about in the attending organisations these tended to relate to their business plans and strategy. Through their presentations at the MAA sessions and exploration of tools at the EXO Project sessions, several SMEs reconsidered the direction or approach of their business. Such impacts are certainly useful, especially with the changed attitudes and awareness of innovation, but they are long term transitions, rather than transformations.
For the ten businesses selected to receive further support, the impacts differed between them and their own ambitions for their respective projects. Some who were more motivated by the grant funding used the four days of support to build up to this, going through the motions and working on their applications. The businesses who engaged fully with their delivery partner took a lot more learning from the process using the advice from their mentor to refine their project or develop their business. Reflecting a wider breadth of business support delivered, outcomes were generally focused on supporting the business to pursue the innovative idea for their organisation or a product the firm was trying to commercialise. In this regard, the businesses already had some of the skills and attitudes for innovation, instead identifying the wider business experience offered by the delivery partners through the one to one coaching support as a benefit.
Participant SMEs also reported revising their business plans both in response to the coaching support received and the grant which had accelerated their product development. Other qualitative impacts included more time spent on new or existing innovative activities, recognising the benefits this could have for the business. Several organisations reported applying for further grant funding and half were pursuing additional business support following the programme. There were also improvements in operational processes among the businesses, particularly towards innovative outcomes, however, these had not yet led to any material impacts, partially hampered by Covid-19 and other business pressures.
Raising their profile to potential clients was a key outcome for several of the organisations and while the Covid-19 pandemic has hampered this, the ability of the companies to develop
9 GBS LEP Innovation Pilot Evaluation Final Report products that they could then showcase to their customers was an important development. Competitivity was also reportedly improved by the participation and support from the pilot.
Despite the time elapsed since the receipt of the grant funding, the complications surrounding Covid-19 have severely reduced the capacity to test quantitative impacts and outcomes from the pilot. When interviewed, all respondent businesses expected that they would increase their employment in the next 12 months, or it would remain the same but employment had not changed since participating in the pilot.
The employment at baseline, taken following the challenge events across the supported businesses was 13.5 Full Time Equivalent (FTE) jobs which remained unchanged 6 months after completing the business support. Turnover among the supported organisations was approximately £335k at the time of the challenge events and had fallen to £265k in the 6 months after the support was completed, demonstrating the impacts of Covid-19. Several of the businesses were expecting the support they received from the pilot to benefit their turnover in the future and likely some employment, but this had not yet been realised.
The impact of the support and grant had therefore generally been to accelerate the development of these micro businesses, test and develop their business plans and support their knowledge of innovation which may have further, future impacts. Outcomes set out in the Theory of Change are summarised in the table below, building on the findings established in the delivery report.
Table 4.4: Theory of Change Outcomes Review
Theory of Change Actual Delivery Increased While skills in innovation have potentially improved due to confidence, the pilot, increases in confidence and attitudes among the attitudes and skills in ten supported organisations has reportedly not improved. innovative practices This is due to many of them being innovation active Outcomes 1 Outcomes organisations already (part of the reason they were selected) and therefore confident in innovative practices. Increased awareness Awareness of demand led innovation support is unlikely to of demand led have greatly increased, due to a relative lack of attendance innovation support at the events in the first place and the drop off in momentum of the pilot (brought about by several factors including Covid-19 and staff turnover at the LEP). New SME Despite the networking opportunity very few (≤2) of the collaborations and organisations reported new collaborations or partnerships. partnerships However, the stage many of the businesses were at with their innovative ideas (looking to execute and build the business around it) may have meant they were not looking to collaborate on anything new at this stage. Changes in time This had reportedly increased among the interviewed spent on innovation businesses.
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Theory of Change Actual Delivery Increased R&D Few businesses reported increasing their spending on spending research and development and there were no changes in the organisations who had or hadn’t claimed R&D tax credits prior to engagement with the pilot. Outcomes 2 Outcomes New Several of the businesses had introduced new processes or working/production revised existing processes following the support they processes received through the pilot. introduced to business Increased number of No business reported new to market product innovations new to market beyond the existing aims of their business. products Increased number of No business reported new to firm product innovations new to firm beyond the existing aims of their business. products Increased Several businesses reported factors that contributed to productivity and increased efficiency in operations, however calculating efficiency of SMEs productivity has been greatly hindered by the wider context of Covid-19, and businesses have been unable to operate Outcomes 3 Outcomes under normal circumstances. Turnover growth Few businesses reported that their turnover had increased, and some had decreased since the baseline due to Covid-19. While all the businesses expected to grow their turnover in the next year, there was only some attribution of this to the pilot, mostly as an accelerant rather than direct creator. Employment growth No business reported any change in employment since the baseline, but all expected to increase their employment in the next year. As with turnover, any change may be partially attributed to the pilot but given the micro nature of these businesses, their employment growth is due to a number of factors and may take longer than turnover changes influenced by the pilot support.
4.2 Case Studies
Case studies for several of the organisations who received support through the pilot are presented below to demonstrate their journey.
4.2.1 Innovation Factory
Innovation Factory are a tech company that have developed market leading algorithms for non-speech and acoustic sound recognition. The algorithms, which have been developed through use of Artificial Intelligence (AI), Deep Learning (DL) and Machine Learning, have a wide range of potential applications in various markets.
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Figure XX: Overview of potential applications for sound recognition sensors and algorithm
Safety Sounds Security Sounds Alerts •Identifies emergency alarms such •Recognises stress and agression •Compatibility with smart phones as windows breaking or babies sounds from voices and enables the algorithm to provide crying environmental distress sounds alerts which can be used to assist such as gunshots the deaf to 'see; sound
Healthcare Acoustic Environmental Home Appliance Sounds •Recognises and analyses sounds Classification •Sends alerts when home from the body to support care and •Able to determine a location based appliances make noises. (eg. diagnostic. on the classification of microwave, egg timer, washing environmental noises (eg. park, machine) restaurant, aeroplane).
Machine Failures Railway Industry •Smart sensors can detect the •Detect and analyse slab track sounds that may inficate failures in real time using acousitc machinery faults providing real and vibration sensors. time analysis on the movement and vibration of the machine
Innovation Factory were motivated to respond and submit a proposal following attendance to a challenge event as they believed the technology that they have developed could contribute towards reducing carbon monoxide and air pollution. It was seen as a great opportunitiy to share their air monitoring product and receive feedback from others working in the sector. It also provided the opportunity for Innovation Factory to network and connect with other businesses and contacts. One of the major challenges the business faced was access to affordable finance to enable innovation. For example, carrying out deployment trials for their sensors can be difficult as it requires real life environments. It was hoped that engaging with the GBS LEP support would help them overcome this barrier.
By attending the challenge event, the business was able to engage with other contacts working in the area. This included other organsiations and academics who, subsequently, they were able to build relationships with and collaborate. Innovation Factory now understand more about the different data air quality organisations currently collect and have developed links with a professor monitoring sites locally where Innovation Factory sensors will now be deployed. They were also able to collaborate with another business working on similar ideas.
The fact that we met someone who is doing similar work but looking at collecting different data meant that we are able to co-operate and make our monitoring more comprehensive and attractive to potential customers as we will have real world data collection evidence.
During the business support phase of the pilot, Innovation Factory received one to one coaching from MAA. This included a deep dive look at their business model and marketing plan. As a result, the business decided to develop the product and move the business into the air-pollution market much quicker than they otherwise might have. It also enabled them to
12 GBS LEP Innovation Pilot Evaluation Final Report act on the advice about how to position and market their new product and enabled them to be introduced to key contacts.
The grant support Innovation Factory received was used for research and development of their sensors which has been crucial in developing their product for market. There has been investment into the development of the software and deployment trials internally. The grant support also led to increased confidence in engaging with innovative practices and, as a result, they are now collaborating with Aston University.
To be honest it was a very small ammount of funding, but we did not anticipate the amount of interest we would get afterwards. We've developed strong networks that have helped us to apply for Innovate UK grants and connect with the University of Birmingham and lots of connection. Things are very promising right now.
The combination of support received has enabled Innovation Factory to explore further funding opportunities. They are seeking to secure additional investment from a number of different sources, including Innovate UK, and have used the evidence of impact generated from the GBS LEP support to apply for this additional funding.
4.2.2 Dignio
Digino UK are the UK based branch of a Norwegian company. They work in the digital care sector developing healthcare solutions with UK operations since 2017. The company employs 50 people globally, including three in the UK and three consultants. Their core business aim is to connect patients and healthcare practictioners through a digital platform, enabling better care in a range of settings.
Dignio’s key product, MyDignio, allows patients to take various measurements and observations at home through bluetooth enabled devices which are then uplaoded from a tablet or smartphone to a cloud platform, Dignio Prevent, which can be viewed by care providers. This solution allows patients to self-manage their conditions and be monitored by healthcare professionals while staying at home, improving flexibility and quality of life for patients.
The company chose Birmingham as their first location in the UK owing to the established tech and health ecosystem locally. They were seeking support to ensure compliance with handling NHS data and wanted to test whether their platform and solution could work with budget smartphones. Previously, iPad devices were used, however, due to concerns of expense and mistreatment of devices by some patients, testing was required to explore whether their systems and software would work using low grade digital devices. By ensuring the product was available to those who may have otherwise been excluded from its use and bridge the digital divide, it is hoped that MyDignio can be accessible by a patient group who may stand to benefit greatly from a digital healthcare offer.
The grant was used for two purposes, one to enable Dignio to access consultant support to ensure their data processing was compliant with handling NHS data, and secondly to permit
13 GBS LEP Innovation Pilot Evaluation Final Report purchase and testing of 10 budget smartphones. These were tested with bluetooth medical devices, such as spirometers, thermometers and blood-oxyden and blood pressure equipment. The outcomes were that these devices were all compaitble and Dignio could be confident their system could work effectively on such budget devices. Without the grant support, this testing would not have occurred until much later.
In a way the grant really moved things ahead or possibly down a route that we wouldn’t have gone down before.
During the one-to-one business support Dignio received support with key aspects of the business including supply chains, how to demonstrate value, and the next steps to move the business forward. Another crucial aspect of the support received was the introduction to new contacts and networks. This helped with getting the organisation and product noticed, provided them with feedback to support the product’s development and gave them confidence that there was need for the product within the sector.
Contacts and validation [were the most useful aspects of support]. Internally you think its great but you need outside people looking in to really see if there is any use in what you are doing. It helps you communicate this to people who don’t work in the same sphere.
Demonstrating that the platform worked effectively with budget smartphone has opened up the potential market for the MyDignio product to a new group of users. The learning demonstrated the product can overcome the digital divide removing the need for expensive devices and ‘enriches the offer to our buyers’. In addition to enabling the devices to be used amongst challenging, and excluded patient groups, it povides the opportunity for potential buyers of the platform to adopt a cheaper model, perhaps as a trial. This previously wouldn’t have been possible.
Dignio now plans to expand their offer to different parts of the UK. They currently have promising projects taking off in the Midlands and North West and plan to grow their care home offer which is an opportunity area that has grown since Covid-19. They see primary and secondary care in the UK becoming much more integrated and feel this would provide an excellent opportunitiy for their product, given the company’s experience of this care approach in Norway.
14 GBS LEP Innovation Pilot Evaluation Final Report 5 Key Learning
This chapter presents a summary of the key learning from the pilot.
• Opportunities to collaborate and learn during the pilot were missed. With two delivery partners adopting different approaches, the pilot presented a useful opportunity to unpick methods which worked and for all partners to work together to draw learning from each other. While the evaluation has looked to draw distinctions between the approaches in the Challenge Event Report, there was little encouraged collaboration between the delivery partners by the LEP throughout the process. Coupled with the delays faced by the project and the task and finish pressure, the pilot did not maximise the learning opportunities to explore innovation development. • Distinction between the LEP and delivery partners created confusion. The LEP were passive during the challenge event phase and supported the delivery phase in business selection and grant award only. This left the delivery partners performing a lot of additional administration but without the freedom to run the whole programme. The reputation of the LEP was also not enhanced as businesses only saw the grant aspects of the pilot as the LEPs involvement, which led to challenges in communication and reputational risk. • Applications and grant funding award needs to be quick and simple. Delays with getting the funding awarded and some challenges or duplications in the content required in the business case and grant applications caused unnecessary issues for the businesses. Being able to respond to an opportunity and move forward with the funding in an agile manner is key to successful innovation outcomes. • The sectors identified were too large and too ambitious for the scale of the pilot. Though alignment to the LEP priority sectors made sense from a policy position, it did not appreciate the challenges that some of these sectors face and the capacity for SMEs to respond to demand led challenges from them. Business, professional and financial services, for instance, is an expansive description that did not provide much strategic innovation focus. Transport is also a broad sector, but one that faces very high barriers to entry preventing smaller organisations from participating in an innovative capacity. Cross-cutting sectors such as digital technology might have been more suitable and would not have faced the same barriers for small businesses that the other themes did. Indeed, the Optimat report reviewed and highlighted several suitable sectors including creative industries, and focused elements of other sectors on pervasive technologies such as AI opportunities. • Grant funding was the principal incentive for the SMEs attending. While some businesses also sought networking opportunities, the grant funding attracted many businesses and due to its scale (£5k) likely only incentivised start-up and micro- organisations. The grant was useful to the successful organisations however, and enabled accelerated product and process development. • Businesses were already innovative, and their projects supported their existing business innovation. The beneficiary firms were selected based on those with the greatest potential to succeed and therefore were businesses already responding to opportunities in a particular industry space. While innovation was supported it was not generated in the way the pilot ambitions had intended.
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• The flexibility of the four days business coaching offer was beneficial to delivery partners and recipient businesses. The ability of the four days to be spread over several months and respond to the individual needs of the business was well received and allowed firms to get the most out of their support. For some this morphed into general advice and business support, others focused on the start-up nature of the firms, while some were pointed towards other innovation funding and collaborations. • Peer to peer support or networking opportunities would have been a useful outcome. Several businesses and the delivery partners suggested that having more peer to peer provision within the pilot or future programmes would have helped to make it more successful. Some firms took part looking to network and for others such an outcome would not have been detrimental to the support they received. • Existing provision is extensive within Birmingham. There are a large number of business support programmes in Birmingham, including those with an innovation focus, as well as many that meet the needs of aspirational start-up companies. Though the Optimat report identified demand led strategic innovation as an important gap in the provision, the general competition for businesses in this space may have been a factor in the low attendance of the challenge events alongside lack of integration with other provision and referral routes such as the Growth Hub. Better integration of the different programmes and funding may be more beneficial than trying to differentiate an offer in a crowded market space. • Fundamentals of the selection process were challenged by the businesses who applied. While the businesses attending the challenge events were generally innovative in some way, some were more advanced and better able to create a business case for their application. The selection became a choice between businesses with a good idea but who needed support to get there or those with a good written application who could deliver outcomes but needed less support. This had been overlooked in the original selection criteria and required the LEP to be in a position to be able to pick winners. One resolution was to conduct interviews or presentations to level the playing field between the written applications which EXO Project did.
16 GBS LEP Innovation Pilot Evaluation Final Report 6 Future Delivery
The original Optimat report commissioned by GBS LEP in 2019 identified a demand led approach as a suitable method to be employed in a pilot project to encourage innovation among SMEs. The use of intermediary innovation experts was also highlighted as well as the need for cross sector and supply chain collaboration. Wavehill has evaluated a variety of busines support initiatives, including those in the innovation sphere and where demand led challenges operate as the core to the delivery. The learning from these other projects, combined with the learning from this pilot can help to outline a number of suggested interventions for moving forward with innovation support in the GBS LEP area.
6.1 Wider Learning
As set out in much of the policy context, business support needs to be more integrated into its local context and respond to the regional challenges strategically working across partnerships and networks. The LEPs have a key role to play in this agenda and can deliver that much needed connection between various stakeholder groups in the public and private sectors. Organisations like the Chambers of Commerce, Federation of Small Business, Innovation Alliance for the West Midlands, industry networks, local authorities, local universities, banks and central government, through initiatives such as Innovate UK, need to be utilised for their strengths. Many provide business support of some form or another, often within an innovation context. Bringing this together is important if the innovations supported are going to successfully meet the ambitions of the region and respond appropriately to the needs.
Beyond strategic partnerships, delivery partnerships are highly important for successful innovation of the scale that can impact an industry. Bringing together partners and expertise to support businesses can be successful, particularly during the middle Technology Readiness Levels, where demonstration, evidence and scaling are needed ahead of commercialisation. Wavehill are evaluating two accelerators in Wales (one for life sciences and one for digital innovation) and the Marine Energy Engineering Centre of Excellence, all of which adopt a model of partnerships to support competitively selected projects brought by businesses. After a business has submitted a successful project proposal, a collaborative approach to resolution is taken with universities and/or private sector specialists. Projects last from a couple of months to a year, depending on their need or scale and can involve capital funding as well as matched revenue support. The costs of these industries generally determine the scale of the projects, from digital projects at <£25k through to marine engineering at >£100k. While these are of a different scale to the GBS LEP innovation pilot, they demonstrate the challenges of successfully encouraging innovation in certain sectors, and that other forms of innovative collaboration could be deployed.
As highlighted above, some sectors are better suited to SME disruption than others and the scale of some of the sectors chosen for the GBS LEP innovation pilot are broad with high barriers to entry. Wavehill has been evaluating the Launchpad programme at Falmouth University for the last few years which adopts a demand led challenge-based model to encourage entrepreneurs to start businesses with a digital innovation focus. Key to the
17 GBS LEP Innovation Pilot Evaluation Final Report success of this programme has been the use of digital as a cross sector theme for innovation. Barriers to entry into the digital space are low compared to the likes of advanced manufacturing and engineering and can be facilitated by smaller organisations. Launchpad has also been successful because it takes businesses through the whole journey from pre- start (businesses are incorporated as part of the programme journey) through to incubation and acceleration. Recently the programme pivoted to accept challenges brought by the participants themselves that could be tested for commercial viability recognising the potential of individual ideas, broadening the scope of innovations than solely from industry led demands.
Peer to peer learning has grown in importance in the business support programmes that Wavehill has evaluated over the last few years and has become a cornerstone of project legacy. As outlined above, the pilot could have benefitted from including peer to peer elements, as EXO Project did to some extent in their workshops. The ability for businesses in similar positions to learn from each other and mutually support each other to resolve challenges they face can be highly beneficial. Thames Valley Berkshire Growth Hub has supported businesses through its programme and then brought these businesses in to provide guidance to future businesses seeking support. Other successful programmes that Wavehill have evaluated, including the local Aston Programme for Small Business Growth, make use of peer to peer learning both during delivery in workshops and externally where social media groups are encouraged so the beneficiaries can discuss their challenges. These then continue after the support programme has completed, providing a connected group in an alumni type model who can continue to develop and mature as businesses together.
Another model adopted by Oxford Innovation delivered programmes that Wavehill have evaluated utilise a stage gate approach to provide general support to a wide range of businesses with additional focused support provided to selected firms. The stage gates are generally based on the observations of the business coaches but can also involve presentations or written applications. This enables the programmes to reach a variety of firms who may have the potential for high growth and development offer them support while also identifying the most promising opportunities. Based on working closely with the business, more insight into their appetite and potential, as well as responsiveness to the support, can be determined. The prospects of return on the support provided can then be determined which generally leads to a higher calibre of firms engaging, developing stronger relationships and working collaboratively to develop solutions and innovate.
6.2 Intervention Options
Based on the findings of this pilot, the recommendations of the Optimat report and the experience of Wavehill in evaluating other innovation support programmes, some options for future delivery are outlined below. These are presented as ideas for GBS LEP to consider and do not reflect a comprehensive options appraisal.
6.2.1 Growth Hub Innovation Officer
One option that could be considered by the LEP is recruiting a dedicated innovation officer at the Growth Hub (or identifying one of the existing initial gateway advisors as an innovation
18 GBS LEP Innovation Pilot Evaluation Final Report specialist), with business support experience and a familiarity with the innovation funding landscape. There are lots of support programmes and grants available that are accessible by innovative businesses in the UK including SMEs, but they often face barriers with awareness, the administrative requirements in applying and the understanding of the requirement in order to be successful. This activity is in line with the existing operations of the Growth Hub and would help to meet the demand demonstrated from the pilot study in which businesses were motivated by the funding available.
As well as helping signpost SMEs to accessing innovation funding and business support programmes, the Growth Hub innovation support officer could also lead introductory sessions on innovation and help provide the basic one to one coaching and sound board that was a key benefit offered by the pilot. Being able to diagnose the needs of businesses, help them to operate around their innovative idea and offer impartial advice would take many of the successes from the pilot and other business support initiatives and provide it on a continual basis. This would reduce the need for demand to reach sufficient levels to justify cohorts and respond to the rapid nature of innovation deployment. It would also recognise that business needs change over time, with some needing short, intense support, and others benefitting from dropping in and out to receive impartial advice.
More broadly, the evaluation of the pilot, the Optimat report and wider policy all suggest that innovation and business support needs to be strategic, cross sector and coordinated within the regional and local supply chain landscape. By having a dedicated innovation support officer at the Growth Hub, the LEP would be able keep abreast of the innovation landscape and ensure that both its activities and those of the SMEs supported could be tied into the strategic context. For instance, one often mentioned benefit from the Clean Air challenge event delivered by MAA during the pilot was the update it provided local businesses on the activities of Birmingham City Council regarding clean transport policy. Being kept up to speed on such developments helps to encourage more participation in a sector and enable businesses to plan to accommodate future events. Similarly, strategic introductions could be made across sectors to help maximise the impacts from other innovations and foster closer collaborations.
The pilot cost over £160k as well as the £50k in grant funding awarded directly. This allocation would be able to support a Growth Hub officer in a permanent role for several years, with the added benefits that they could be used to support other Growth Hub activities as required. It may also be possible to combine the innovation support officer option with others such as the small grant programme, the Growth Hub officers, led by the innovation support officer, determining which applications receive funding.
Such an option would have to be careful not to duplicate the offer of the likes of Innovate UK but considering some of the beneficiaries reported that they had been made aware of Innovate UK through the pilot, there may be benefits of the Growth Hub officer making these connections.
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6.2.2 Small-Scale Grant Programme
Several of the pilot participant businesses, as well as the delivery providers, suggested that the £5k grant funding was insufficient to deliver significant impacts. The allocation did, however, help to accelerate some product development among the businesses and accessing funding at low and middle Technology Readiness Levels (particularly that which requires simple application and award) can benefit micro organisations who are still just developing ideas.
If the LEP were able to allocate a small grant funding pot annually that provided capped match grant funding then it would not only incentivise technology development, but also help attract the potential successful businesses of the future. Having been awarded a grant and identified by the LEP, the relationship with the SME could develop, bringing them into collaboration and contact with others to help set them on the journey to success. For instance, one business on the pilot who was interested in participating to access the grant has since been put in contact with Aston University to collaborate. This could also link back to the successful sustained engagement approach adopted by Oxford Innovation described above with more continued support for those with the greatest prospects.
The grant funding could be used to pay for external business support if that was considered useful to the SME, or for product development and testing. This would link into the recent announcements in the 2021 Budget for deductions of investment costs from tax bills and provide a stepping stone to other funding announced in Build Back Better, such as British Patient Capital and the Future Fund: Breakthrough.
In order to differentiate from the other small grants available to micro businesses, any future LEP innovation grants should be easy to access, timely and introduce applicants to written submissions without being overly burdensome. Young businesses have a lot of time pressures and learning from the pilot shows that some struggled with the paperwork requirements and would not have considered the grant application if they had known it would take so long. The grant could even be used to help the businesses secure coaching support or source a bid writer to apply for larger funding pots, which are a barrier to micro and small businesses.
6.2.3 Demand Led Programme
A demand led innovation programme could be successful but would need to be adjusted to accommodate the challenges and strengths of the pilot. The biggest weakness of the pilot was the scale of the businesses who participated and therefore their capacity to respond to the industry led challenges in sectors that were broad and had high barriers to entry. By focusing on a cross sector theme with lower costs of entry such as digital, a future LEP scheme could follow some of the successes from the Launchpad scheme in Cornwall.
Most of the ten businesses who were selected to participate in the pilot programme had a digital aspect to their activity, as did many of those who attended the challenge event sessions. Like the Launchpad programme which successfully takes the skills and ambitions of entrepreneurs and directs them into an opportunity area identified by a range of industries, GBS LEP could work with the industry and market to identify and present these challenges. A
20 GBS LEP Innovation Pilot Evaluation Final Report cohort model where delivery commences every 6-9 months after sufficient numbers of businesses have registered an interest can ensure each round of a programme has the volume of businesses to be successful and enable peer to peer support. A more structured programme of support than the pilot may bring greater outcomes, potentially adopting a stage gate model as outlined above where businesses progress to next levels of support depending on their aptitude and opportunity. This would work more effectively over a longer time period of a 6 months or year. Those organisations who did not progress beyond the first stage gate would still receive some basic business and innovation support, as well as an awareness of the challenges in a certain industry. Others could receive more intense support at different intervals as they progress through a project, receiving appropriate support at each stage, from product development, to accessing finance and commercialisation.
This could be supported by grant funding at each stage and would connect beneficiaries into funding opportunities such as Innovate UK. Innovation and business support coaches would need to be recruited or contracted to lead the programme with delivery supervised or fully integrated into the LEP to avoid some of the challenges identified in the pilot. Maintaining a good bank of industry challenges would require the LEP to be familiar with the needs of their industries and large businesses, helping raise the profile of the LEP in the area.
The wider ecosystem of existing business support provision is an important context however, with competition for firms between other programmes, even if they have a different focus. As has been explored above, many of the businesses participating in the pilot needed general business support which would start to overlap with the wider provision available. There may also be a need to ‘hide the wiring’ so clients do not recognise that they have been dropped while others have continued to receive support.
6.2.4 Innovation Support Programme
A different support option would be to build on the strengths of the EXO Project challenge workshops. A smaller scale innovation support programme that provided businesses with the tools and knowledge of innovative practices that they can use to build into their business would help those small to medium sized organisations who have become unproductive and stuck in their ways. This group was identified in the rationale, but few such businesses attended the challenge event sessions during the pilot. The several who did fall into this category were the ones who took the most from the EXO Project sessions, as it offered them ideas and practical tools they could use to rethink their business plans.
This programme approach could be more flexible to the resources of the LEP, held as a series of short workshop sessions, or an intense package of one to one coaching support. Research and evaluations from Wavehill show that where support of this nature is most successful is where the businesses deliver something real for their business as part of the programme so that the application is related. Frequently this takes the form of innovation or growth plans, developed alongside the workshops and presented back at a pitch session in the last workshop, for comment from peers in the cohort. Other options would be to blend workshop delivery with an innovation mentor who can work with the business to implement the learning into the organisation.
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The focus on innovation of unproductive firms would help respond to the productivity rationale and link into the new announcements in the Build Back Better policy for productivity boosting initiatives such as Help to Grow. It is important though to ensure that this does not duplicate other provision already available to firms in the West Midlands, and even if sufficiently distinctive, is not targeting the same organisations leading to shortages in demand. Attracting the businesses to the programme would also be a challenge; the organisations who have become unproductive may be less likely to be looking out for innovation focused business support or responsive to the offer.
6.2.5 Business Support Programme for Innovative Start-ups
One clear feature of the businesses on the pilot programme was that they were frequently start-ups or very young SMEs, but with novel ideas. These businesses consequently were not in need of innovation support to develop their products and be innovative (they mostly reported they already felt like innovators), but instead needed support to build a business around their ideas. The four days of support that the delivery partners provided the ten participant businesses were often focused on providing a sounding board and impartial advice, but also about business-specific development that reflected their start-up nature. Consequently, a structured programme of business support for start-up business or pre-start individuals with an innovative idea could be considered to offer the required knowledge to take their innovative idea into an operable business.
There is, however, a lot of existing provision in this space including incubators (such as STEAMhouse, SPARK and the University of Birmingham led BizzInn) and existing programmes (such as the Startup Sprint programme, Aston Programme for Small Business Growth, and Enterprise for Success programme). Any business support provided would have to fit into this wider ecosystem avoiding overlap and using the opportunities of other incubators available to move participants to, after completing their support. Should there not be the available niche in the ecosystem (and a short review of the available programmes makes this likely) this would add additional incentives for GBS LEP to consider the option of an innovation expert at the Growth Hub who could help direct start-up businesses with an innovative idea to the most suitable support available.
22 GBS LEP Innovation Pilot Evaluation Final Report 7 Conclusions
The GBS LEP Innovation Pilot generated some important learning as well as creating some outcomes for the supported organisations. While the businesses did not respond to the demand led approach the pilot had taken in the way envisaged, a number of important opportunities were identified which can be used in future programmes or interventions.
Against its original theory of change (see appendix) the pilot has met some of its objectives. It has tested a demand-led approach to innovation stimulation in target sectors, with the learning informing this report. It has increased SME awareness of demand led innovation opportunities, although to a limited audience. It has also generated some competitiveness and turnover benefits for the beneficiary businesses. To a lesser extent some collaboration has been fostered among the SMEs, though not directly through the pilot itself, instead through raising of wider awareness and networking introductions. Understanding the value of involving industry bodies in delivery has been limited however, given the challenges faced by the pilot in attracting the scale of businesses it needed to meet the demand challenges set.
That the pilot was not able to attract the volume and scale of the businesses that it targeted, coupled with sectors that face high barriers, fundamentally challenged the remaining delivery. It did, however, stimulate some learning. While the companies who did attend did not generate additional innovation projects or pivot in response to the challenges posed at the events, this does not mean they were not already innovative and the support they received helped them in other ways. They were able to get strong business support and coaching, get put in touch with other stakeholders and potential collaborators and receive support to draft grant applications. Although Covid-19 led to a dramatically changed context for the pilot, those who attained the grant were able to use this to accelerate their planned product development, supporting innovation up to higher TRLs. Despite some minor process challenges during the delivery phase and delays to the challenge events, the pilot was generally well run by the delivery partners, though the support from the LEP was mixed.
Looking forward there are several options that emerge following the learning from the pilot that maintain the core aims and rationale highlighted in the Optimat report. Incentivising innovation is directly related to productivity and the definition of innovation should be wide to consider this; innovation for one company may relate to new processes, while another may be its core product development. Given many of the businesses participating in the pilot were already innovative in some way, and mostly micro start-ups, future programmes could instead focus on support for this level of business to build a business around their innovative idea. Alternatively, the support could be to focus on those businesses who are not innovative and have become unproductive to help them return to efficiency. However, given the prevalence of support programmes available in the West Midlands and particularly Birmingham, this may duplicate other support.
Another option would be to better use the existing Growth Hub and recruit an innovation specialist. This would help the businesses locally to access the right support (a barrier faced particularly by micro firms), strategically direct the innovation and collaborations (as one of the core rationales to the pilot) and offer much needed ad hoc coaching and advice to SMEs.
23 GBS LEP Innovation Pilot Evaluation Final Report
The Growth Hub officer could be supported by a small-scale grant programme which would be simple to apply to and administer and provide limited grants to help micro businesses with innovative ideas test or implement them, or even use the funding to seek consultancy support with larger applications to the likes of Innovate UK. The strengths of the pilot in providing flexible advice, small grant allocations, and outcomes for collaborations and business development could be achieved on a continuous basis, reducing the need for generating sufficient demand to deliver a successful programme. The insight of the Growth Hub officer on local innovation strategy would then feedback to the businesses, providing the demand led incentives or opportunities to businesses where suitable, putting industry players with challenges in touch with smaller firms with solutions.
Though a demand-led challenge model might have potential to operate alongside the existing provision in GBS LEP, there would need to be a shift in the sectors targeted and a more formal structure of support developed into a programme. A stage gate model, where funding and further support are provided after competitive selection at various stages could help to disseminate information widely, while also ensuring the most opportune firms were encouraged to success. Such a programme would need to consider the learning from the pilot and how best the LEP could be engaged and the timeframes involved, as well as maintaining a strong cross sector awareness of appropriate challenges to be presented. Attracting businesses to such a programme may still remain a difficulty however, and larger grant incentives may be needed to encourage participation.
24 GBS LEP Innovation Pilot Evaluation Final Report Appendix Theory of Change
Rationale GBS LEP has identified Innovation as a key driver for productivity and growth in the region with evidence suggesting that levels of innovation are low in the West Midlands. Evidence from the UK Innovation Survey, Regional Innovation Scoreboard and National Statistics reveal innovation gaps between the GBS LEP and benchmarks.i Innovation overall is eight per cent below the best performing LEPii while R&D expenditure in the West Midlands is two per cent of GDP, average for the UK but below the Industrial Strategy target of 2.4 per cent by 2027.iii Lifelong learning is 18 per cent below the UK average.iv GVA per hour shows there is a productivity gap of 8.7 per cent between the West Midlands (NUTS2) and the UK with Birmingham similarly 8.1 per cent below the UK average.
There are opportunities for the GBS LEP to improve its productivity with the region possessing strong manufacturing, science and technology sectors as identified in the regional Science and Innovation Audit.v Recognising the challenge of the traditional supply led model, a report proposes a demand led innovation programme for GBS LEP which has been adopted as the Pilot Innovation Challenge.vi Objectives Inputs • To pilot approaches to demand-led innovation in key target sectors (Advanced Manufacturing & • £163,500 in GBS LEP funding for the programme. Engineering (AME), Health & Life Sciences, Business, Professional & Financial Services (BPFS), Low • Expertise of contracted delivery partners EXO Project and MAA. Carbon Environmental Technologies & Services). • £50,000 in grant funding available (potential for up to £5,000 for each successful business) for • To understand the value of involving industry bodies in delivery. further business support. • To increase SME awareness and understanding of demand led innovation opportunities. • Management, delivery and promotion support provided by GBS LEP. • To foster and encourage collaboration and innovation among SMEs. • To increase productivity, competitiveness, turnover and employment for SMEs in the GBS LEP. Activities MAA LEP 1. Three challenge setting events with industry leads and experts. Management of the pilot. 2. Three demand led innovation challenge events for Transport Technologies, Health and Life Sciences, and Low Carbon Environmental Technologies. Promotion and marketing. 3. Innovation surgery sessions at the challenge events. Data collection, monitoring and evaluation. 4. Fifteen SME project proposals submitted responding to the challenges set. 5. Six projects selected by the steering group (these might not be evenly divided between the three challenges). 6. Four days of business support tailored to the needs of the SMEs projects (potential to use £5k in funding for further external support). EXO Project 1. Two events for Advanced Manufacturing & Engineering, and, Business, Professional & Financial Services over two days each. 2. SMEs submit a short business plan with two competitively selected by EXO Projects and GBS LEP. 3. A face-to-face meeting with an innovation expert and follow-on telephone support as required (potential to use £5k in funding for further support).
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Outputs Outcomes 1 Outcomes 2 Outcomes 3 Impacts • Approximately 100 SMEs attending • Increased confidence, attitudes and • Increased R&D spending. • Increased productivity and • Increase GVA/Output in GBS LEP. challenge events (20 per event). skills in innovative practices. • New working/production processes efficiency of SMEs. • Increased efficiencies of supported • Ten SMEs receive additional • Increased awareness of demand led introduced to business. • Turnover growth. businesses. innovation business support and innovation support. • Increased number of new to market • Employment growth. • Advancement of an innovation brokerage to further business • New SME collaborations and products. ecosystem in the GBS LEP and WM support. partnerships. • Increased number of new to firm areas. • Up to 10 SMEs receive grant funding • Changes in time spent on products. • Potential for a continuation of the of up to £5k. innovation. pilot into a demand led innovation Process programme for SMEs in the GBS LEP • Fully tested pilot programme. area. • Design, approach, management and governance insight for the GBS LEP. • Evidence base for future programmes. • Strengthened business support offer for innovation in GBS LEP.
Assumptions Barriers Risks • Providers are able to engage sufficient businesses in the target • Available resources may restrict the effectiveness of the pilot. • Providers are not able to lever in support from their networks. sectors to participate in the pilot. • Lack of suitable SME businesses in the marketplace and/or • Crowded marketplace for innovation support programmes • SMEs with aptitude to innovate attend the challenge events. target sectors. leading to fatigue of target businesses and reduced attendance. • The events generate innovation opportunities. • Awareness in the market and among SMEs of innovation • Challenges are not suitable for the attending SMEs leading to: • The events catalyse collaborations. opportunities is low. • Inadequate business responses to the challenge events • Businesses value and gain a return from the support provided • The administrative burden of accessing grant funding could be • Responses to challenge events are of a low quality. generating outcomes. prohibitive. • Businesses do not invest or respond to the innovation support • Innovation support relevant to the selected • Time constraints on businesses. received. businesses/individuals can be provided. • Low capacity within the SMEs to advance with their proposed • Cross over of sectors and SME capabilities to respond to • Responses by SMEs do not already take place in the market. challenge responses. multiple challenges. • Support is sufficient to enable SMEs to bring innovative products • Expectations from businesses may not match the capacity of the • Support lacks relevance to participant businesses needs. or services to market. limited resources available from the pilot. • Pilot interacts with businesses already innovating heightening • Geography of the pilot limited to the GBS LEP may reduce the risk of significant deadweight. numbers of potential SMEs (especially as MAA operates over • Lack of legacy from the pilot leads to a loss of momentum. WM). • Challenges of measuring progress towards innovation without tangible products or services. Enablers • Procurement of appropriate delivery partners. • Effective penetration and marketing of the programme to targeted businesses by delivery partners (EXO Projects and MAA). • Clear communication and cooperation between the partners. • Challenge setting events for MAA strand allow development of appropriate challenges. • Identification of challenges in the EXO Project strand allows creation of appropriate challenges. • Selected projects/SMEs are brokered or provided with the most appropriate support for their needs. • MAA presenting other two challenges at each challenge event to allow cross-project working where it might be beneficial for the businesses involved.
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27
i Business innovation, diffusion and productivity in the West Midlands, S. Roper, Enterprise Research Centre, 2018 ii UK Innovation Survey, BEIS, 2015 iii Intramural R&D expenditure (GERD) by sectors of performance and NUTS 2 regions, ONS (Eurostat), 2016 iv Regional Innovation Scoreboard, European Commission, 2019 v A Science and Innovation Audit for the West Midlands, SQW, 2017 vi Interventions for Increasing Business Innovation in Key Growth Industries, Optimat, 2019
01545 571711 [email protected] wavehill.com
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GREATER BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD 10 JUNE 2021 ENTERPRISE ZONE PROGRAMME UPDATE
Recommendations The GBSLEP Board is requested to note: I. the Enterprise Zone Programme Project Updates; II. the Enterprise Zone Programme Q4 2020/21 Financial Update; and III. the commissioning of a carbon reduction plan/strategy to support the Enterprise Zone route to Net Zero. EZ Programme Project Q4 Update 1. The Enterprise Zone is currently supporting a number of capital projects. The status of these are as follows: 2. Snow Hill Public Realm (Delivery) Approved £2.9m. The Snow Hill Public Realm scheme will introduce high quality public realm improvements and highway interventions to local streets and spaces in the Colmore Business District. Linked to the ambition to redevelop Snow Hill Station in the future, it supports the Snow Hill Masterplan. Outcomes will focus on enhanced connectivity, reduced congestion, increased use of Snow Hill Square and improved air quality. Update: Project 2.2 (Edmund Street) due to commence works early August 2021. Project 2.3 (Steelhouse Square) is currently being assessed against other schemes in the immediate vicinity, particularly the City Centre Traffic Segments initiative and Active Travel Fund schemes. There is a risk that the outcome of this review may impact on the viability of the scheme or to a delay post Commonwealth Games. 3. Curzon Metro Stop (Delivery) Approved £9m. The funding is supporting the delivery of HS2 and the integration of the Metro with the station. Planning permission was secured in April 2020. The HS2 Curzon Station Masterplan sets out the vision for the Curzon area, which includes proposals for the Metro route and integrated tram stop at the HS2 Curzon Station. The Design and Build contract procurement commenced in June 2020. 4. Old Curzon Station (Delivery) Approved £2m. The project is being promoted by a partnership which includes HS2 Ltd, who are committing £3.6m of funding and will deliver the refurbishment works; Birmingham City University (BCU) will manage the building and Birmingham City Council, as landowner, would provide a 10-year lease on a peppercorn rent. The EZ funding will match the commitment from HS2 Ltd. Outcomes from the project will be the creation of 1,239 sqm and 35 direct jobs. Update: The first of a two-stage procurement process has completed, with Mace and Dragados awarded the contract to work with HS2 to finalise the detailed design of the station. 5. Digbeth High Street (Delivery) Approved £15.7m. Digbeth High Street is a catalyst for development and private sector investment, supporting both the realignment of the
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METRO to facilitate improved public realm and create enhanced public spaces, but also focussing on other key modes of sustainable transport including cycling and walking. The investment will demonstrate commitment to ensuring that Digbeth is a key development area in the city. Update: Board approved the investment on 25 March 2021. Construction works are scheduled to commence from July 2021. 6. Belmont Works (Delivery) Approved £2.5m. Located at Eastside Locks the £57.9m comprehensive conversion/refurbishment of the Locally Listed Belmont Works will help fund the construction of a new multi-use office building (Steamhouse), a collaborative innovation centre focused around STEAM disciplines (science, technology, engineering, arts and maths), including related teaching and learning space delivered by BCU through a STEAM Academy plus commercial space and grow-on space for SMEs and office space for a single user or multiple users. 7. Metro Extension (Completed) EZ Capital Investment £20.4m. Operational in December 2019, the Metro at Centenary Square is the first tramway in the UK to operate on battery power, removing the need to fix electrical wires to listed buildings. The Metro has brought forward the Westside extension of the Midland Metro from New Street Station, serving Victoria Square, Paradise and Arena Central developments. The total project cost is £64m. Update: Completed. 8. Pinch Points, Ashted Circus (Completed) EZ Capital Investment £1.5m. The Improvements to Ashted Circus created left-turn slip lanes on both Dartmouth Middleway approaches at Ashted Circus. It is a key junction for Aston University, Eastside and the Curzon regeneration area. The benefits of this have been a new four-arm traffic signal- controlled junction, staggered traffic signal-controlled toucan crossings, on carriageway cycle lanes and shared use footway for pedestrians and cyclists. Update: Completed. 9. Southside Public Realm (Delivery) Approved £8.7m. The Southside improvement scheme is to transform the Southside area into the new “front-door” of Birmingham City Centre. The scheme will upgrade links which connect the area to surrounding transport hubs and Enterprise Zone (EZ) sites, and (Hurst Street, Ladywell Walk and the lower section of Hill Street). Update: Works are on-site, Severn Trent Water has commenced exploratory digging for utilities. Completion of Works expected Spring 2022. 10. Curzon Station Environment (Development) EZ Capital Investment £26.2m. The project comprises two different public realm schemes, known individually as Curzon Promenade and Paternoster Place and will be delivered by HS2 within the contract to design and build the station. Update: FBC due December 2021.
Paradise Phases and PwC Update (Phase One/Two EZ Investment £139.07m) 11. Phase One complete with no further updates. Phase Two is continuing to progress well. 12. Phase Three (EZ Investment Requested £54.3m). GBSLEP has received the Phase Three Interim Business Case and the Independent Technical Evaluation has been completed. An update is provided separately to this report.
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PwC Phase One & Two Assurance Update 13. In April 2020, GBSLEP and BCC appointed an independent appraisal team (PwC) to carry out a review of the Phase One and Phase Two project. An update paper is presented for noting by GBSLEP Board. Birmingham Smithfield (Development) EZ Investment requested £131.4m 14. Development Funding (Change Request): The change request for the additional development funding was agreed at PDB on 3 March 2021. GBSLEP Board has been updated on the decision to increase development through the regular EZ update report. 15. Developer Agreement: During the last month the Council has been in negotiations with Lendlease and their legal advisers to close out all outstanding commercial points plus all supporting information necessary to be in a position to execute the Joint Venture Agreement (JVA). The focus primarily has been on: a. The principles associated with Enterprise Zone funding; b. The impact of COVID-19 pandemic and the possibility of future pandemics and how that would affect the JVA and the construction documents; and c. Financial parameters relating to costs and receipts. 16. Whilst negotiations have progressed, these have not yet been finalised with a few points still outstanding. In the last four weeks, meetings have been held weekly (with additional meetings attended by Lendlease's Managing Director and the Director of the Council). It is anticipated, post-meeting, that final amendments and changes will be made to the legal documents, ready for engrossment by the end of May. 17. Post-engrossment, the BCC project team will be focused on developing its internal processes to ensure the necessary resources are in place to monitor Lendlease's development. Lendlease will be mobilising teams to commence works on the hybrid planning application and associated works. 18. Enabling Works/Commonwealth Games: BCC submitted the Full Business Case on 10 May 2021 and the independent technical evaluation has commenced. It is anticipated that the technical evaluation will be made available to GBSLEP Executive on 9 June 2021 and, subject to any issues arising from the FBC evaluation, will be submitted to the July Board meeting (subject to a recommendation from PDB) for an investment decision. 19. Project Dashboard / Project Roadmap: The May 2021 Smithfield Dashboard is included in Appendix A and Project Road Map included in Appendix B remains unchanged from March 2021. Martineau Galleries (Not in EZ Investment Plan, Investment Requested circa. £70m) 20. The submitted Outline Business Case has been evaluated and the Programme Team is working with the Project Sponsor to reduce the minor issues and information gaps highlighted as part of the business case review. The Project Sponsor is keen to progress with a strong business case and is therefore working with GBSLEP to improve the original submission. It is anticipated that this will be in the next 3-4 weeks with a submission to GBSLEP Board in July 2021 for OBC consideration.
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EZ Performance Data Update (Q4, 2020/21) 21. The overall performance data position for the Enterprise Zone Programme (to 31 March 2021) is included below. There is no change to the jobs created or land reclaimed following the Q3 update. However, the total floorspace created/refurbished, the total EZ investment and the private sector match funding have all increased slightly. Output / Outcome Jobs Land Floorspace Total EZ Private Created Reclaimed Created / Investment Sector and Made Refurbished (Q4 model) Investment Ready (ha.) (sqm) Forecast to 2046 71,796 60 1,100,000 £1.45bn* £3.90bn Actual achieved to date 6,657 19.4 281,535 £175.8m £848.9m % Actual achieved to date 9.3% 32.3% 25.6% 12.1% 21.8% Table 1.0 Performance Data (Actual achieved to 31 March 2021) Note * Due to changes in the financial model resulting from the implementation of Financial Principle 16 (paragraph 29 below) the total anticipated EZ Investment has been reduced by circa. £84m. EZ Model Financial Position Background 22. Enterprise Zone activity is funded by prudential borrowing on behalf of the GBSLEP which is repaid from the uplift in business rates income (BRI) generated from new or refurbished commercial development. Q4 2020/21 Update 23. The latest Q4 financial model was updated in May 2021 and is now presenting a cumulative surplus of £5.57m (Table 2.0) to the end of March 2021; this is an increase of £1.22m on the previous Q3 forecast of £4.35m. The overall position has improved primarily due to a significant positive impact of the year-end assessment of provisions for appeals and to a lesser extent provisions for bad debts. Latest Valuation Office data on appeals has reduced the actual losses anticipated in-year due to the removal of appeals presented on the grounds of material changes in circumstances due to COVID-19. Central Government has ruled this out as a reason for a reduction in rateable values and will instead use compensatory measures for businesses struggling because of COVID- 19. Additionally, the assessment of provision for bad debts has been lower than previously anticipated, further improving the Net BRI.
Actual Forecast
Q3 & Q4 20/21 Annual Forecast / Actual 2020/21 2019/20 Variance Note: Deficit/(Surplus) Q3 Q4 Capital Spend to March 20: £154.25m £m Capital Project Spend (inc. Capitalised Int.) 25.51 24.87 21.63 (3.23) Expenditure (Capital borrowing/interest, 4.14 6.24 6.22 (0.02) Revenue & Contingency) Net Income (BRI Net of Provisions) (4.33) (5.77) (6.93) (1.16) In-Year Deficit/(Surplus) Sub-Total (0.19) 0.48 (0.71) (1.19) Total Brought Forward Balances (3.28) (3.47) (3.47) 0.00 In-year Contingency 0.00 (1.36) (1.39) (0.03) Total Cumulative Deficit/(Surplus) (3.47) (4.35) (5.57) (1.22) Table 2.0 2020/21 Annual Forecast / Actual
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24. The forecast, as previously advised, also assumes that the programme will be able to continue to capitalise staffing costs in relation to the GBSLEP and BCC staff directly supporting the programme and projects. A five-year forecast for both capital and revenue expenditure is shown in Appendix C and D.
Annual Forecast - 5 years ONLY Secured and Committed BRI Note: Deficit/(Surplus) 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26 Capital Spend to March 20: £m £154.25m Capital Project Spend 21.63 44.59 25.24 12.82 26.61 8.85 (inc. Capitalised Interest) Expenditure (Capital borrowing/ 6.22 11.34 13.58 14.47 20.03 21.07 interest, Revenue & Contingency) Net Income (BRI Net of Provisions) (6.93) (9.62) (15.28) (18.11) (25.74) (25.39) In-Year Deficit/(Surplus) (0.71) 1.72 (1.70) (3.64) (5.71) (4.32) Sub-Total Total Brought Forward Balances (3.47) (5.57) (6.20) (11.77) (19.98) (35.34) In-year Contingency (1.39) (2.35) (3.87) (4.57) (9.65) (7.13) Total Cumulative (5.57) (6.20) (11.77) (19.98) (35.34) (46.80) Deficit/(Surplus) Table 3.0 Five Year Annual Forecast 25. The model is currently forecasting a cumulative surplus of £6.20m for 2021/22, £11.77m for 2022/23 and £19.98m for 2023/24 and increases to £46.80m in 2025/26. It is anticipated that the surplus will rise further than previously advised in 2023/24 as a number of key developments complete and are occupied by tenants. 26. In accordance with the new EZ Financial Principles, the financial model has been updated to account for Financial Principle 16. This states that only projects that have received a conditional allocation (OBC approval) will be profiled in the EZ model. Projects that do not have a conditional allocation (OBC approval) will have all potential capital expenditure included in the last year of the programme (2045/46). Therefore, by moving the expenditure to the last year of the programme this removes all potential capital financing costs in the EZ model and projects that have not yet had OBC approval cannot impact on affordability calculations for those seeking an investment decision. However, once the projects receive a capital allocation (OBC approval) the capital investment costs plus financing costs are reintroduced accordingly. 27. As a result, this has reduced the expenditure in the financial model by £84.47m (reducing from £1.54bn to £1.45bn) and will therefore offer a more accurate position when considering an Outline Business Case, and potential borrowing costs, for projects when presented for an investment decision. Table 4.0 below provides a summary of the changes resulting from the above. 28. The 2045/46 forecast outturn has improved by £88.70m compared to the Q3 2020/21 model from a £748.12m deficit to a £659.42m deficit. This deficit will remain significant until the BRI for the programme becomes secured or committed in line with the approved financial principles. As noted in the ALL BRI table (above), this ultimately does forecast a significant surplus, but this will be subject to additional capital borrowing costs when each project is approved and costs profiled.
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2045/46 Cumulative ONLY Secured and ALL BRI including Committed BRI Anticipated Forecast Note: Deficit/(Surplus) Q3 Q4 Variance Q3 Q4 Variance
Total Capital Spend to £m £m March 20: £154.25m Capital Project Spend 1,019.17 1,020.25 1.08 1,019.17 1,020.25 1.08 (inc. Capitalised Interest) Expenditure (Capital borrowing, Revenue, 1,535.32 1,450.85 (84.47) 1,535.32 1,450.85 (84.47) Interest & Contingency) Net Income (BRI Net of (531.33) (534.95) (3.62) (1,824.09) (1,827.71) (3.62) Provisions) Cumulative Deficit / 1,003.99 915.90 (88.08) (288.78) (376.86) (88.08) (Surplus Cumulative Contingency (255.86) (0.62) (255.86) (0.62) (256.48) (256.48) Total Cumulative 748.12 659.42 (88.70) (544.64) (633.34) (88.70) Deficit/(Surplus) Table 4.0 2045/46 Cumulative Forecast Capital and Revenue Project Spend (Increased to Five Years) 29. The forecast capital and revenue spend is shown in Appendix C and D and includes an annual forecast to 2025/26 with the inclusion of the total investment as specified in the Enterprise Zone Investment Plan May 2019. 30. Capital project expenditure up to March 2020 was £154.2m and has increased by £21.6m to £175.8m in 2020/21. Capitalised interest and capitalised project delivery costs account for £4.99m of these costs for 2020/21. Enterprise Zone Business Rates Income (Q4 2020/21) 31. The Enterprise Zone Net Business Rates Income (BRI) for 2020/21 (Appendix E) has now been confirmed as £6.93m. This has increased from £5.77m in the Q3 forecast and the primary reasons are highlighted in paragraph 26 above. A plan highlighting Enterprise Zone BRI areas is shown in Appendix E with a detailed breakdown of BRI sites for 2020/21. 32. It should be noted that whilst there is an improved position for Q4 compared to the Q3 forecast, the BRI will remain volatile due to the on-going, and unknown, future impacts of COVID-19. Any differences will likely come from delays in occupations and project completions but will be monitored closely over the next few years as the programme matures.
Programme Project Schedule 33. The following projects remain scheduled for submission to Programme Delivery Board; any changes to the previous report are highlighted in bold: a. Curzon Public Realm, FBC (Q4 2021/22); b. Moor Street Queensway, OBC (Q1 2021/22) FBC (Q3 2024/25) c. Birmingham Smithfield, Enabling Works FBC (Q1 2021/22) d. Birmingham Smithfield, OBC (Q4 2021/22), FBC (Q3 2022/23) e. Paradise Phase Three, IBC (Q1 2021/22), FBC (Q4 2021/22)
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Enterprise Zone Investment Plan, Development 34. GBSLEP, in partnership with BCC, is continuing to develop the framework for the new Enterprise Zone Investment Plan (EZIP). It is proposed the revised EZIP will be more closely aligned to the GBSLEP Delivery Plan, and the emerging BCC “Our Future City Plan”, developing key themes around place making, innovation/5G, carbon reduction, culture and creative sectors, skills and workforce development etc. 35. GBSLEP is working with BCC to commission a carbon reduction strategy/plan for the Enterprise Zone with a view to understanding the opportunities to reduce the carbon impact of existing and proposed projects whilst also considering specific projects to address the route to Net Zero. A budget of £20,000 has been allocated to this piece of work and it is anticipated that this will be commissioned by early July 2021. GBSLEP Board will be kept updated on progress.
Conclusion 36. Project progress and project development remains positive, and the better than anticipated outturn for 2020/21 is encouraging for the Enterprise Zone programme. The positive impact resulting from Valuation Office appeals has also provided additional optimism for the short-term impact on Business Rates Income and the Enterprise Zone financial model. 37. It is therefore proposed that the Enterprise Zone programme is rated Amber with some caution remaining because of the longer-term impact of the current pandemic and uncertainty on the commercial market in the City. All of which will be monitored closely over the next 12 months. Report by: Christian Cadwallader, Consultant Programme Manager Contact: [email protected] (07929 056153) Date Created: 21 May 2021
Reviewed by: Keith Mitchell, Interim Finance Consultant
Appendices
A Birmingham Smithfield Dashboard (May 2021)
Birmingham Smithfield Roadmap (March 2021) [Exempt from Publication B under Clause 3 of Section 12A of the Local Government Act 1972]
C EZ Capital Programme Five Year Forecast (May 2021)
D EZ Revenue Programme Five Year Forecast (May 2021)
Business Rates Income (Actual 2020/21) [Exempt from Publication under E Clause 3 of Section 12A of the Local Government Act 1972]
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Paper partially Exempt from Publication under Clause 3 of Section12A of the Local Item 8 Government Act 1972 APPENDIX B – Birmingham Smithfield Roadmap (March Update 2021) [Exempt from Publication] Paper partially Exempt from Publication under Clause 3 of Section 12A of the Local Government Act 1972
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Paper partially Exempt from Publication under Clause 3 of Section12A of the Local Item 8 Government Act 1972 Appendix E Enterprise Zone Business Rates Income (Actual 2020/21) [Exempt from Publication] Paper partially Exempt from Publication under Clause 3 of Section 12A of the Local Government Act 1972
Item 10b
GREATER BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD 10 JUNE 2021 ENTERPRISE ZONE, PARADISE ASSURANCE REVIEW Recommendations The GBSLEP Board is requested to note: I. the key findings of the Phase One review as highlighted in this report; and II. the positive annual assurance of Phase Two. Background 1. In 2013 and 2014, the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) approved Enterprise Zone (EZ) funding totalling £87.8 million for the Paradise Circus project in Birmingham City Centre. The Paradise Circus project, comprising three phases, is now in the second phase of delivery with Phase One completed and Phase Three progressing to full business case stage. However, cost increases on Phase One (and to support the delivery of Phase Two) resulted in Birmingham City Council (BCC) submitting a request to GBSLEP for additional funding of £51.3 million in 2018. This was approved on 12 February 2019. 2. Following the conclusion of an independent technical evaluation of the revised business case, the request for additional funding was approved subject to conditions by the GBSLEP Board in December 2018. One of the conditions of this approval was the commissioning of an independent review of Phase One and why the additional funding request occurred. Also that there should be an on-going assurance report, submitted to BCC and GBSLEP annually, to give confidence that the conditions of grant continue to be satisfied and the working arrangements are sufficient to effectively monitor the project. 3. PwC were jointly engaged by BCC and GBSLEP to undertake the review into Phase One and the current working arrangements and governance position. The scope of this work consisted of three parts: • Part One - using the lessons learnt from the independent technical appraisal of the business case, to investigate why any issues experienced throughout the delivery of Phase One, which led to the additional funding request, occurred and produce a report on the findings; • Part Two - an annual assurance report to BCC and GBSLEP to give confidence that the conditions of grant continue to be satisfied and that the working arrangements established in response to the issues identified in Phase One are sufficient; and • Part Three - to provide an assurance report on Practical Completion of Phase Two, with the exact scope of work to be determined nearer the time. 4. GBSLEP Board Members will have previously been informed of the scope of Part One and Part Two, details of which are now included below. The scope of the Part Three assurance report has yet to be finalised. Part One – Independent Review 5. The investigation into why the issues experienced throughout the delivery of Phase One occurred focussed on eight areas: . Business case and independent review; . Funding Agreement; Item 10b
. Delivery structure; . Project management, board oversight, monitoring and reporting; . Roles and responsibilities; . Independent cost scrutiny and performance review; . Change management; and . Risk and risk management. 6. The PwC report notes that several different causes were identified, and it was acknowledged in the report that issues were undoubtedly easier to identify with hindsight. There were, however, key factors that underpinned why the issues arose in Phase One, and these are summarised below: Business Case and Independent Review 7. The business case prepared was not reflective of the size and complexity of the project and it did not receive an appropriate amount of scrutiny at the time. It would have also benefited from a more detailed appraisal by both BCC and GBSLEP prior to approval. Funding Agreement 8. The funding agreement at the start of the project had not been subject to an appropriate level of scrutiny by BCC and GBSLEP. The arrangements reflected the controls and processes in place for the development of capital schemes at BCC at the time but provided a weak baseline from which the project was delivered and monitored. Delivery Structure 9. Only a small number of BCC staff were involved in establishing the delivery arrangements for the project, which resulted in a limited wider understanding of the delivery structure. This impacted on the effective dissemination of information to both BCC and GBSLEP. Project Management, Board Oversight, Monitoring and Reporting 10. Project governance arrangements at the time, both at BCC and GBSLEP, were not sufficient for a project of the scale of Paradise. This was partially due to the wide span of control BCC held over the project, insufficient coordination between individual departments, roles and responsibilities not being made sufficiently clear, and GBSLEP being a newly formed organisation with very limited resources. Roles and Responsibilities 11. As 10 above. Independent Cost Scrutiny and Performance Review 12. GBSLEP relied heavily on the project management arrangements put in place by BCC as set out in 9 & 10. above. Subsequently, although all costs were verified by a quantity surveyor, there was insufficient questioning of performance information, such as milestones, independent cost reviews and reporting on the expected costs to complete Phase One. Increased costs for Phase One were reported at Paradise Circus Limited Partnership (PCLP) Board between 2014 and 2017 but not shared with GBSLEP until 2018. Change Management 13. There was a lack of a robust change management process between BCC and GBSLEP, and typically only took place between PCLP and BCC. Risk and Risk Management 14. Whilst a risk register with project risks were presented in the business case, there was a lack of a robust risk management within BCC and subsequent reporting to GBSLEP was limited and insufficient. Item 10b
Part Two – Annual Assurance 15. In December 2018, GBSLEP Board approved the request for additional funding. One of the conditions of this approval was an independent annual assurance report to give confidence that the conditions of grant continue to be satisfied and the working arrangements remain sufficient to provide oversight of the project. 16. There were eight Conditions of Grant applied to the increased funding, all of which have been met and are included below: i. Overage Arrangements, revised overage arrangements to be set out in the Disposal Protocol, State Aid compliance, meets the requirements in terms of managing public monies. Condition met, however, due to current C19 restrictions only electronic versions have been accessed and therefore signed versions have not been verified in person.
ii. Memorandum of Understanding, which sets out the operating arrangements and roles and responsibilities for the remainder of the scheme. Condition met, additional recommendation to provide a more detailed illustration of how the Overage provisions work.
iii. Funding Agreement which includes a clear schedule of works, fees and other costs against which progress and expenditure can be monitored; and a clear basis in the form of a proposed schedule upon which grant is paid against progress made in relation to outputs and costs incurred. Condition met.
iv. GBSLEP representative as an observer on the PCLP Board. Condition met, GBSLEP observer attends PCLP and provides update reports.
v. The establishment of an Officer Group comprising PCLP, BCC and GBSLEP representatives that would meet ahead of the PCLP Board meetings to review issues and progress. Condition met.
vi. Monthly and quarterly reporting. Condition met.
vii. The appointment of an independent advisor to review costs, financial and physical progress and to validate interim claims for EZ payment. Condition met, an independent Quantity Surveyor was appointed.
viii. An independent audit of Phase One co-commissioned with Birmingham City Council, in its capacity as the Accountable Body for GBSLEP, and an audit on final completion of Phase Two and interim evaluation of performance. Condition met (on-going compliance).
17. The PwC report confirms that all of the conditions have been met and that a number of the changes made as a result of the conditions of grant have strengthened the governance, controls and processes in all of the areas where weaknesses in the arrangements in the period leading up to 2018 had been identified. Item 10b
18. The report also noted a small number of improvement opportunities which will be further considered for implementation by the PCLP programme group. This included a working illustration of the overage arrangements to accompany future reporting. Part Three – Phase Two Completion Assurance 19. Due on completion of Phase Two, expected to be in 2024. Scope for this to be agreed at a future stage. Conclusion 20. Shortcomings surrounding governance on Paradise Phase One were acknowledged by BCC and GBSLEP in 2019 on the conclusion of independent reviews into the scheme governance and increased funding request. 21. There were no adverse reports on the actual spend increase as these were found to be legitimate and the scheme to be under sound delivery partner management. The governance issues arose primarily because the original business case presented for funding approval was not at the correct RIBA stage now required for FBC approval, and as a result did not contain sufficiently advanced programme and cost details. As the programme progressed and was managed internally by BCC, there was inadequate reporting of the costing updates through to GBSLEP and no involvement of GBSLEP in Phase One cost change control. GBSLEP in turn, did not actively participate in project management or oversight. 22. Following the extensive work and independent appraisals carried out in 2019, both of costs incurred and Phase Two cost proposals, it was considered that the revised management arrangements and governance procedures put in place were robust. The positive annual assurance from PwC further confirms that both BCC and GBSLEP are fully informed on progress and achievements; and appropriate mechanisms are now in place for GBSLEP to consider a further business case for Phase Three.
Report by: Christian Cadwallader, Consultant Programme Manager Contact: [email protected] (07929 056153) Date Created: 21 May 2021
Reviewed by: Kerry Billington, Consultant Programme Manager Item 10c
GREATER BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD 10 JUNE 2021 PARADISE PHASE THREE, INTERIM BUSINESS CASE APPRAISAL
Recommendation The GBSLEP Board is requested to: I. Note the submitted Interim Business Case (IBC) presented by Birmingham City Council (BCC) and prepared by Paradise Circus Limited Partnership (PCLP) for the Paradise Phase Three project and the provisional request for £54,346,953 (fifty-four million, three- hundred and forty-six thousand, nine hundred and fifty-three pounds) following the submission of an Interim Business Case and the Independent Technical Evaluation (ITE) completed on 26 March 2021; II. Note the Interim Business Case appraisal has been completed on the basis of a Full Business Case with a view to supporting BCC in the submission of a Full Business Case to GBSLEP; III. Approve a one off exemption to the GBLEP Assurance Framework to allow consideration and award of development funding up to £1.0m to BCC (prior to a conditional allocation being approved) to support the submission of the Phase Three Full Business Case; and IV. Approve the delegation of the development funding request referred to at iii, to the Programme Delivery Board, who will consider the development funding request in accordance with the Assurance Framework. Board is asked to note that this delegation is only in respect of the development funding for Phase Three, and all future funding requests will be presented to Board in accordance with normal practice.
Background 1. The Paradise development is the centre piece of Birmingham’s current development projects, delivering much needed supply of new Grade A commercial office space in the heart of the city centre. It is one of the largest redevelopment schemes in Birmingham and the UK, regenerating a strategic site in the city’s economic hub. Paradise is supporting the continued economic growth and prosperity of the city and making significant enhancements to the overall environmental quality and pedestrian connectivity of the surrounding area. The scheme also delivers significant wider city infrastructure, which optimise the layout of the highway network and reduce the previous severance between Birmingham’s City Centre and its Westside, as set out in the Big City Plan. 2. When completed, Paradise will fundamentally transform the experience for businesses located in the area and for individuals passing though the city centre, providing wider benefits to transport connectivity, public realm improvements, and efficiency of land use, all in addition to the provision of world class mixed-use development. 3. Birmingham City Council (BCC) in partnership with Paradise Circus Limited Partnership (PCLP) are seeking to apply to Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) for £54,346,953 of EZ grant funding (subject to submission and
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
approval of their FBC) towards Phase Three of the Paradise Development. Paradise Phase Three would complete the Paradise development, one of the largest redevelopment schemes in Birmingham, delivering 611,294 sqft of office floorspace and 3,072 sqft of retail floorspace. 4. The scheme will continue to be delivered by PCLP, a joint venture company between BCC and a pension scheme. A 50/50 joint venture structure has been set up to provide a vehicle through which the public infrastructure and site preparation works are carried out, which will both improve the highway infrastructure and the public realm for the benefit of the city and will prepare the site for the re-development phase. 5. The total scheme costs for Phase Three are estimated to be £389,121,730. The proposed funding for the project assumes £54,346,953 (14%) contribution from GBSLEP with the remaining costs covered by the Developer £334,774,777 (86%). The GBSLEP funding will go towards funding the infrastructure works of the scheme below podium level and the public realm elements of the scheme. 6. The Interim Business Case (IBC) has been prepared to provide GBSLEP with an update on the current progress of Phase Three. It was originally anticipated that a Full Business Case (FBC) would be submitted to GBSLEP in May 2021 following the appraisal of the IBC but as a result of the feedback from the ITE, this will now require additional design work and preparation as detailed in this report. Subject to confirmation of the additional design work and new programme, the FBC is now expected to be submitted in 10-12 weeks. 7. On 19 May 2021, Programme Delivery Board (PDB) noted the current position of the project and technical evaluation of the Interim Business Case; furthermore PDB approved the recommendation to GBSLEP Board to consider a one off exemption to the Assurance Framework, as detailed in section 25 in this report.
Case for Change 8. Prior to the start of the physical regeneration project in 2015, the Paradise Circus site was a mixed-use development with building stock primarily dating from the 1970s. The site was generally perceived as dysfunctional for a variety of social and economic reasons including: having poor accessibility and permeability throughout the site, having a low quality public realm, and poor design and layout from a public safety perspective. 9. The Paradise project has focused on the regeneration of this blighted area, key to which has been to address the lack of supply of Grade A office accommodation in the city centre. Verified in the Phase Two, 2018 Full Business Case, the project does help to address this and the property market needs in the local and regional area. 10. Phase One is complete and Phase Two is now underway. Since the completion of Phase One, and at the time of writing, the office space completed in 2019/20 is currently 76% let and 12.5% under offer, resulting in a total of 88.5% take up including under offer office space. Phase Two comprises of a new hotel, two new office buildings and a residential tower. The first office to come forward in Phase Two will be One Centenary Way and, once completed, will provide circa, 280,000sqft of new Grade A commercial office space. Phase Two is due for completion in 2024. 11. Phase Three is the final stage of the Paradise development, and will provide over 600,000sqft of further commercial space, the creation of a new public square and new car park.
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
12. The main objectives of the proposed Phase Three scheme are to: . Remove major severance between the city centre core and westside; . Unlock the strategic investment potential of the area by facilitating land-use change, thereby creating economic and commercial value for the city and providing further much needed supply of Grade A Office Space; . Deliver a greater agglomeration of businesses in central Birmingham and thereby increasing the effective density of the business district across central Birmingham; and . Create significant additional business rates for GBSLEP as set out in the City Centre Enterprise Zone Investment Plan 2019. 13. The IBC sets out the following outcomes and benefits that will be realised as part of the overall project, illustrated below: . Total office floorspace delivered: 614,677sqft or 56,791sqm; . Total retail space delivered: 3,027sqft or 281sqm; . £252m GVA impact on-site for Phase Three (2015 prices) and . 4,751 gross jobs created on site for Phase Three.
Figure 1.0 Paradise Phasing Illustration
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
Independent Technical Evaluation 14. The appraisal seeks to review the progress of the scheme and outline details that will need to be provided at FBC stage and so is being compared against the FBC requirements. The key principles being as follows: . Strategic case: this needs to be completed including a full analysis of needs, objectives, inter- dependencies and risks; . Economic case: options must be appraised and value for money position determined; . Financial case: details of the costs, their phasing, breakdown by those parties on whom they fall, and risk allowance must be provided as well as funding sources; . Commercial case: at FBC stage, the Project Sponsor senior management should be in a position to consent to the procurement phase of the project. This means that the procurement strategy must include details of the sourcing options, proposed procurement route and supporting information. Payment and charging mechanisms must also be outlined. An assessment of how the types of risk might be apportioned or shared needs to be presented as well as a high-level view of implementation timescales; and . Management case: dependencies need to be set out as well as key milestones, a critical path and arrangements for risk management. The project’s plan through to completion should be appropriately detailed and realistic, including any contract management strategy. 15. The evaluation was completed by Aecom on 26 March 2021 and the report is available on request. The ITE has identified 19 red, 20 amber and 4 green issues but is as a direct result of the IBC being reviewed as a FBC in preparation to support the development and future submission of the FBC. The five cases are summarised below along with key information gaps and issues to be addressed: 15.1 The Strategic Case presents background context of the Paradise Development Phase 1 and 2, however the rationale for the project is based on the 2018 FBC submission for Phase 2 and needs to be updated with clear evidence of the market need for Phase 3 and alignment with local and national policy objectives. The scope of the scheme has been defined; however, it is subject to change once the scheme undergoes the optioneering process in the FBC. The strategic case provides a list of deliverables for all phases in the IBC. The FBC submission should focus purely on Phase 3 and what it delivers. The SMART objectives delivered for Phase 3 should be provided as part of the FBC with a clear need for change presented for Phase 3 followed by detailed drawings and land use mix delivered in Phase Three. 15.2 The Economic Case needs to be further developed at FBC stage, the applicant should present the process used to develop a long list of options and sift them down to a shortlist of options. In line with the new Green Book, all options need to deliver all strategic objectives set out in the Strategic Case. A clear rationale must be provided and a Cost-Benefit Analysis of all short-listed options as part of the rationale for choosing the preferred option. Currently the optioneering process has not been undertaken in the IBC and therefore the economic appraisal of alternative short-listed options has not been provided. A narrative is presented on the cost- benefit analysis for Phase Three but is based on the appraisal carried out in the
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
2018 FBC submission, using the assumptions made in 2018 for land value uplift, business rates and additionality factors. At FBC stage an updated economic options appraisal must be submitted with Cost Benefit Ratios for all shortlisted options. It must be noted that all shortlisted option must meet the SMART objectives criteria and the preferred option selection criteria must be clearly established. The economic appraisal for the preferred option must be based on up-to-date information, including the latest design stage available for Phase 3. Sensitivity analysis has not been conducted at this stage but will be once the updated economic appraisal is developed at FBC stage, we expect to see robust testing of the BCR ensuring costs and benefits have been appropriately tested, as well as impacts on rents, yield, programme and Covid 19 impacts. 15.3 The Financial Case presents the scheme’s costs in Appendix 1 based on RIBA Stage One costings provided by Quantem quantity surveyors. AECOM’s Cost Consultants have reviewed the IBC costings and concluded that at FBC stage, the applicant needs to provide an updated detailed costings of all elements of Phase 3, as well as a confirmed level of contingency and optimism bias, provide general arrangements and elevations of the scheme and the area schedule for the development in order to undertake a thorough cost review. The FBC should provide a breakdown of the total project costs and not just the GBSLEP grant funding of £54m which can be reviewed against the scheme’s drawings and plans. GBSLEP grant funding is going towards delivering the infrastructure works of the scheme part of the early stages of the project. GBSLEP may want to consider, at FBC stage, looking at spreading their funding to other elements of the scheme (i.e., offices and retail floorspace) to ensure the whole development is fully complete and avoid the grant becoming a sunk cost. 15.4 Montagu Evans has also reviewed the commercial property market aspects of the IBC within the Financial Case and have concluded a few actions that the applicant needs to consider at FBC stage. Whilst the IBC sets out a Business Rate Model, no information is provided to demonstrate that the Phase Three scheme is viable as a whole. Therefore, at FBC stage the applicant needs to provide a Phase Three financial and development appraisal and associated cashflows which clearly indicates the viability of the scheme. This should be supported by an updated ‘fact book’ which clearly states the assumptions used (floorspace areas, rents, yields, incentives, build costs, areas, etc). This also needs to clarify the profit margins being targeted across the scheme, for the various roles (e.g. Development Manager, Developer/Contractor). All assumptions and background information which forms the basis of the Business Rates Model should be provided which clearly indicate how the build-up of the rates ‘return’ is assessed. The FBC must include an annualised breakdown of the rates assumed to be received from each part of the development by floorspace use (and linked to the development plots and uses within each). 15.5 The Commercial Case provides details of the contractual and procurement approach to the scheme. The scheme will be delivered by PCLP within the framework of agreements governing financial contributions and returns. The objective of PCLP is to provide the vehicle through which the public infrastructure (highways and public realm) and site preparation works for each phase of the scheme will be carried out. It will have a limited life, until the working capital provided is repaid.
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
15.6 At this stage, the exact procurement route and specific scope for Phase Three has not been confirmed. The proposed delivery arrangements for Phase Three are said to be similar to Phase Two using a Two Stage Design & Build Procurement Route. At FBC stage, the applicant needs to confirm the exact procurement route and scope, to identify the key contractual risks within an updated quantified risk register and report on the relative success of procurement in earlier phases if the same approach is taken. A detailed risk register has not been provided at this stage. This needs to be developed at FBC stage to include all contractual, financial and delivery risks with appropriate mitigation measures. An owner needs to be allocated to manage each identified risk. 15.7 The IBC also provides limited information as to the key milestones for contracting and procuring services. This should be provided within a detailed Gannt Chart at FBC stage. The applicant has stated that the risk mechanism is likely to be through a pain/gain mechanism in a lump sum, fixed price contract. The applicant needs to specify at FBC what type of contract is being used (e.g. JCT/NEC) and provide supporting evidence. 15.8 The Management Case provides a high-level breakdown of the scheme’s programme which needs to be further developed for the FBC submission to include all key milestones for the tendering, design and construction of Phase Three, with appropriate time allowances built in. Detail has been provided on the governance arrangements of the scheme which includes several key stakeholders and partners, however CVs from the key team members has not been provided and should be at FBC stage. The IBC fails to mention the status of planning permission and other consents for Phase Three and this should be clearly outlined within the programme to state when consents have been confirmed for Phase Three. 16. There are also a number of recommendations, on each element of the business case, included in the Independent Technical Evaluation which have been shared with the Project Sponsor for consideration prior to the submission of the Full Business Case. Both the Interim Business Case and Independent Technical Evaluation are available on request. Programme and Funding Profile 17. The Phase Three development costs and gross infrastructure capital costs are highlighted in Table 1.0 below. The Enterprise Zone funding breakdown for Phase Three is included in Table 2.0 below.
Table 1.0 Proposed Development Costs (Phases One, Two and Three)
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
Value for Money 18. The Project Sponsor has stated that the Benefit Cost Ratio (BCR) will be circa. 4.3 based on the Present Value Benefits (PVB) of £771m and Present Value Costs (£177m); suggesting very high value for money. The Full Business Case will assess the BCR in more detail and sensitivity test the various risks associated with the assumptions made on benefits and costs.
Project Outputs 19. The project outputs highlighted in the Interim Business Case are summarised in Table 3.0 below:
Table 2.0 Breakdown of EZ Funding and Infrastructure Works Output Output Description Completion Quantity 77 Paradise _ Demolition Q1 2022 Two Centenary Way 95,000 sqft Commercial Q1 2026 One Congreve Square 158,470 sqft Commerical Q3 2026 Two Congreve Square 186,163 sqft Commercial Q1 2028 Three Congreve Square 175,044 sqft Commercial Q1 2028 Pavilion 3,027 sqft Retail TBC Public Realm TBC Public Realm Q1 2029 Table 3.0 Project Outputs
Development Funding Request (Exemption to GBLEP Assurance Framework) 20. In accordance with the GBSLEP Assurance Framework, a project is awarded a conditional allocation of funding in the Enterprise Zone Financial Model when the Outline Business Case is approved. This also provides opportunity for the Project Sponsor to request development funding (from that allocation) to assist with the production of the Full Business Case. The development funding is allocated from the conditional funding allocation and forms part of the overall funding request.
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
21. In the original Outline Business Case for the Paradise project, a conditional allocation for all three phases, including Phase Three, was secured. However, due to the additional funding requirement for Phases One and Two the conditional funding allocated for Phase Three was utilised for the delivery of Phases One and Two. Therefore, there is no conditional funding allocation for Phase Three in the EZ Financial Model and therefore no mechanism from which to request any development funding. 22. Additionally, the Interim Business Case, as presented, is not formally recognised in the GBSLEP Assurance Framework (or Green Book Business Case process), and therefore is not able to request a conditional funding allocation or request the development funding from any conditional allocation. 23. Therefore, a one off exemption from the Assurance Framework is required to approve development funding without a new conditional allocation being approved. Development Funding and Business Case Evaluation (Proposal) 24. As presented in this report, the technical evaluation of the Interim Business Case has highlighted a number of key requirements in order to present a robust Green Book compliant Full Business Case. This includes progressing the design of Phase Three beyond the currently anticipated RIBA Stage Two to Stage Three in order to fully satisfy the requirements of a Green Book compliant evaluation. The Project Sponsor has indicated that this could cost up to £1.0m, and whilst this is a fundamental requirement of the project design progression, the current project cost plan does not have the capacity to fund the RIBA Stage Three design prior to Full Business Case approval and the future release of both public and private funding. 25. GBSLEP has received an informal request from BCC to release development funding of circa. £1.0m to support the RIBA Stage Three design for Phase Three as part of a future funding allocation. PCLP has confirmed to BCC and GBSLEP that the cost of producing a RIBA Stage Three business case is circa. £2.4m, compared to a RIBA Stage Two business case of £1.5m. Whilst a formal request for funding has yet to be received from BCC, work is currently underway to formally prepare the request and seek the necessary internal approvals and assurance to present the request to GBSLEP. The request will include the full rationale for the additional funding, programme information and a full cost plan. It has been agreed this will be reviewed by the independent Quantity Surveyor, appointed by BCC to review all Paradise costs, prior to submission to GBSLEP. 26. As a one off exemption to the Assurance Framework, GBSLEP Executive supports the decision to allocate the development funding as this would support a more robust business case for Phase Three and provide better assurance for GBSLEP by advocating our fudiciary duty to protect the public purse. As mentioned above, it would be subject to a review of the formal request for funding and confirmation of the rationale, programme and full cost breakdown. It is not expected at this stage, that the revised programme for the FBC submission would delay the overall delivery of Phase Three and vis-à-vis business rates income from the development. 27. Additionally, BCC has also requested development funding (circa. £60k) to support the technical evaluation of the full business case when presented by PCLP and prior to submission to GBSLEP. The evaluation of the business case prior to submission to GBSLEP is to ensure that the business case is robust and, as Project Sponsor, are fully
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10c
acquiescent with the request for funding and continues to support the rationale highlighted in Section 30.
Conclusion 28. The evaluation of the Interim Business Case has confirmed the substantial progress that has been made on Phase Three since the submission of the Outline Business Case nearly three years ago. It has also emphasised, following the technical evaluation of the Interim Business Case, that a significant amount of additional development is necessary in order to submit a Green Book compliant Full Business Case. 29. However, in order to support the production of a robust Full Business Case, development funding is required to progress the design and procurement information. Therefore, as part of the update on the Interim Business Case to GBSLEP Board, a request is also made to consider and approve a one off exemption to the Assurance Framework to support a development funding request (circa. £1.0m) which will be prepared and submitted to GBSLEP Executive in due course. Once the formal request is submitted, consideration will be given by Programme Delivery Board in accordance with the Assurance Framework.
Appendices (Available on Request) A Full Business Case (Avison Young) B Independent Technical Evaluation (Aecom)
Prepared by Christian Cadwallader, Consultant Programme Manager Reviewed by: Kerry Billington, Consultant Programme Manager
Contact: [email protected]
Date prepared: 21 May 2021
Enterprise Zone Report, Paradise Phase Three (Interim Business Case) Item 10 d
GREATER BIRMINGHAM AND SOLIHULL LOCAL ENTERPRISE PARTNERSHIP BOARD
10 JUNE 2021 ENTERPRISE ZONE INVESTMENT PLAN AND PROJECT PIPELINE DEVELOPMENT
Recommendations The GBSLEP Board is requested to note: I. the update on the development of the new Enterprise Zone Investment Plan; and II. the proposal to review the existing project pipeline in the Enterprise Zone Investment Plan 2019 and develop a new project pipeline and strategy, in partnership with Birmingham City Council (BCC), as part of the Enterprise Zone Investment Plan update.
Background 1. Established in 2011 the City Centre Enterprise Zone (EZ) now covers 113ha and currently has access to £983m (based on forecast business rates) of prudential borrowing which represents significant growth opportunities in the city. 2. The current Enterprise Zone Investment Plan (EZIP) was published in 2019 and sets out a 10- year investment strategy. Consideration is now being given to updating the EZIP following both a request from the Enterprise Zone Management Sub-Group and the need to reflect the broader strategic objectives of the GBSLEP Delivery Plan and emerging Birmingham City Council (BCC) “Our Future City Plan”. 3. This report seeks to inform GBSLEP Board Members of the on-going work with BCC to review and refresh the EZ project pipeline as part of the Enterprise Zone Investment Plan 2021/22. Critical to the consideration of a refreshed project pipeline is to remain cognisant of the key strategic projects previously identified in the EZIP 2019 which provide net income to the EZ programme.
Enterprise Zone Investment Plan 2019 / Case for Change 4. The current EZIP consolidated the two existing investment plans: City Centre EZIP (2014) and the Curzon Investment Plan (2016). It sets out a 10-year investment strategy for major schemes and infrastructure projects within the EZ as well as outlining key programmes and projects, the forecast economic impact, governance process and financial management etc. 5. In March 2020, the Enterprise Zone Management Sub-Group made a recommendation to Programme Delivery Board (PDB) to refresh the EZIP2109 with a view to considering the changes that have occurred since 2018/19. This would include a review of the project pipeline and updating some of the governance arrangements, such as the financial principles. This was also supported by BCC as a key partner. 6. A key change that has occurred since the production of the EZIP 2019 is the Covid19 pandemic, the resulting lockdowns, and subsequent impact on the economy. This has had a significant influence on how businesses operate as well as potentially influencing future investment and the project pipeline. Internal changes include the advancement of several projects, defrayal of funds, launch of the GBSLEP Delivery Plan 2021, the emerging BCC ‘Our Future City Plan’ and updates to the Financial Model, Programme Delivery Assurance Framework and EZ Governance and Management. 7. It is also proposed that the revised EZIP will be more closely aligned to key themes such as place making, innovation/5G, carbon reduction, culture and creative sectors, skills and workforce development etc. Item 10 d
8. Further external changes include the launch of the new The Green Book: appraisal and evaluation in central government and UK officially leaving the EU which will have a variety of impacts. 9. Table 1.0 below provides an outline of EZIP 2019 proposed capital activities throughout the EZ. It should be noted that the majority of projects within current commitments have completed or made significant progress, some of which are now subject to further and/or updated business cases.
Forecast Programmes (Capital) Timescale Projects/Locations (£m) Current commitments 2013-2028 350.4 Paradise (Phase One and Two) Paradise (Phase Three, subject to FBC) Centenary Square Birmingham Smithfield (Subject to OBC) Snow Hill One Station Southside Public Realm Enterprise Zone Pinch Points Former Curzon Station Westside Metro (Complete) 2021-2022 4.5 Metro Extension (New Street to Centenary Square) HS2 Station Environment 2019-2026 59.4 Paternoster Place Curzon Promenade & Curzon Square Station Square & Moor Street Queensway Curzon Station Metro Stop Digbeth Public Realm Phase 2019-2023 15.5 Digbeth High Street One Typhoo Wharf Digbeth Public Realm Phase 2022-2046 70.9 Further Wider Interventions Two GBSLEP Investment Fund 2024-2028 20.0 Support Strategic Economic Plan East Birmingham Metro 2022-2026 183.3 Metro extension to East Birmingham and Solihull Curzon Programme 2028-2046 259.6 Further Wider Interventions HS2 Interchange 2028-2046 20.0 HS2 Interchange UK Central Hub Birmingham Airport Birmingham International Station 983.6 Table 1.0 EZIP 2019 Investment Programme 10. In accordance with the EZ financial principles, all EZ investment decisions are subject to affordability testing and prioritised from the EZIP 2019. This is determined by assurance testing applied to the EZ financial model.
Business Rates Income Modelling 11. BCC, in partnership with GBSLEP, is commissioning an evidenced-based report to determine the demand and potential economic impact of the 39 EZ sites. The report will help highlight the potential demand in terms of business growth and start-up businesses, support any intervention which could increase demand and economic impact and also consider the option of offering a second phase of site development funding for the EZ programme. 12. Additionally, the report will gather market intelligence across the 39 EZ sites and consider which of the sites are likely to maximise the business rates income as modelled in the original EZ financial model. The modelling will then seek to understand to what extent, if at all, EZ objectives such as business rates income, are potentially at risk so that consideration can be Item 10 d
given to prioritisation as part of the EZIP review. 13. The invitation for tender is due to be reviewed for submission over the next month. GBSLEP Board will be kept updated on progress through the EZ programme report.
Project Pipeline 14. The new EZIP project pipeline will include a review of existing projects to determine if they are on programme, remain strategically important and continue to represent good value for money; but also include potential new projects which may significantly support the economic growth of the City and region with the assistance of public funding. In accordance with the Assurance Framework, this would be demonstrated through a robust business case process and be subject to the on-going requirement to clearly identify a commercial viability gap, aligned outputs to the Enterprise Zone performance targets and, critically, increased business rates income. 15. It is proposed that the updated EZIP will also consider an increased focus on strategic areas such as the HS2 Growth Area as part of the Enterprise Zone and include HS2 Station/Curzon and Digbeth areas, which can be seen from Table 1.0 are the key programmes over the next few years. Opportunity exists to consider restricted “calls” to attract projects and investment into the Enterprise Zone which will allow for the development of a pipeline of projects for the strategic areas. The new project pipeline strategy may also consider utilising a business rates income focussed open “call” to allow new projects to be considered that will immediately impact on the business rates income and could therefore be considered at any time. This will allow a more flexible approach to the EZ, where projects get approved quarterly via the GBSLEP PDB and Board, in partnership with BCC. 16. Whilst it is proposed that there is an increased emphasis on strategic areas in the Enterprise Zone, should an appropriate project materialise from outside these sites, GBSLEP and BCC will be able to consider additional projects to the pipeline, subject to continued assurance and applicability requirements.
Regional Projects 17. Currently included in the EZIP 2019 is a capital allocation for regional projects which are likely to be pertinent for the EZ but not directly located in Birmingham. This allocation of £5.0m per annum commences in 2024/25 up to a maximum of £20.0m and will be made available to Councils within the GBSLEP geography to submit proposals for. As with all capital and revenue funding in the EZIP, any potential EZ expenditure is subject to full business case approval, a prioritisation process and include affordability calculations in accordance with the approved EZ Financial Principles. 18. Opportunity potentially exists in the new EZIP to start considering strategic and/or outline business cases for early consideration by PDB and GBSLEP Board prior to 2024/25 which could also include development funding, subject to affordability etc., as part of the refreshed EZIP. Consideration could also be given to the profile of the £20m funding, which could be extended beyond four years, or possibly condensed (subject to affordability).
Project Pipeline Working Group 19. An officer working group, consisting of GBSLEP and BCC, is currently working on the proposals for the EZIP 2021 project pipeline and development strategy. The next step will be to expand the officer working group to include BCC Members and GBSLEP Board/PDB Members once suitable progress has been made on the proposed strategy and draft pipeline. GBSLEP Board Members will be kept updated of progress through regular EZ programme reporting.
Conclusion 20. Following a request from the Enterprise Zone Management Sub-Group to update the EZIP; the Programme Team has been working with BCC, to create a new approach to developing the Item 10 d
project pipeline including the opportunity of new “calls” to support new and strategically important projects. It must be recognised that any investment decision or opportunities for additional investment will be subject to affordability testing and strategic prioritisation and these will be key parameters when considering how the pipeline is developed and project “calls” are managed and/or initiated. 21. The success of the Enterprise Zone programme is highly dependent on the ability of the programme to increase and/or accelerated business rates income to support capital and revenue investment, both in Birmingham and the region.
Report by: Saboor Arif, Project Champion / Christian Cadwallader Consultant Programme Consultant Contact: [email protected] 0121 281 3561 Date Created: 21 May 2021
Reviewed By: Christian Cadwallader, Consultant Programme Manager Date Reviewed: 24 May 2021
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GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 JUNE 2021
GROWTH PROGRAMME UPDATE: LOCAL GROWTH FUND AND GETTING BUILDING FUND
RECOMMENDATIONS The GBSLEP Board is requested to note: I. the Local Growth Fund (LGF) performance for quarter four, subject to final assurance by Birmingham City Council, and for the financial year 2020/21 and completion of the programme by 31 March 2021; II. the financial performance, subject to final assurance from Birmingham City Council, of the £21.851m LGF (Department for Transport Returned Funding) grant funding and approval of projects to 31 March 2021, with £3.556m approved to carry forward to 30 June 2021; and III. the Getting Building Fund (GBF) progress to date against the GBSLEP allocation.
LOCAL GROWTH FUND
Background This paper provides the financial position for the fourth quarter and the cumulative year to date for the final year of the LGF programme which concluded in March 2021. Given it is the final year of the programme, the total allocation over the six-year programme of £186.05m must be both contractually committed and defrayed by the end of March 2021. The final year spend profile required defrayment of £53.36m. This includes the £21.50m underspend from previous years carried forward and is a higher expenditure target than in any previous financial year.
LGF Overall Financial Position from Start of Programme Over the five years to March 2020, the programme achieved expenditure of £132.74m, with £53.32m to be defrayed in 2020/21. The profile of annual BEIS award and actual project expenditure is summarised in Table 1.
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15-16-17 17-18 18-19 19-20 20-21 Total LGF Award £m £m £m £m £m £m £96.489 £25.699 £19.303 £12.716 £31.847 £186.055
Financial Year Total LGF Outturn 15-16-17 17-18 18-19 19-20 20-21 £m £m £m £m £m £m Actual /Forecast £62.599 £23.229 £24.239 £22.671 £53.317 £186.055 Progress towards 65% 90% 126% 178% 167% 100% Award Table 1: Six-Year LGF Programme Financial Status (Source: BEIS 2020/21 Q3 Return) LGF Financial Position 2020-21 The actual, subject to final assurance by Birmingham City Council (BCC) and forecast quarterly spend of contractually committed projects for the final year of the programme is summarised below in Table 2. The target spend forecast as reported to BEIS on 17 June 2020 is included in Table 2 for comparison. The profiled spend below reflects the reduction for the £0.04m extra PMO levy claimed in 2019-20 which had not been taken out of the 2020-21 figures when reported on 17 June.
Quarter Quarter Quarter Quarter Annual One Two Three Four Total ACTUAL ACTUAL ACTUAL ACTUAL Forecast Target Spend reported to BEIS 13.05 17.42 13.10 9.79 53.36 17 June (£m) ACTUAL/Profile 13.281 17.90 13.14 9.00 53.32 Spend (£m)
Variance (£m) +0.23 +0.48 +0.04 (0.79) (0.04)
Table 2: Quarterly grant spend forecast for 2020-21
1 The quarter one actual figure has been amended from £13.33m to take account of an adjustment agreed with BCC in the Unlocking Stalled Housing programme. Quarter Four Update The latest Q4 grant spend forecast of £8.98m against the remaining £9.00m to be spent in quarter four is outlined in Table 3 below. To date, claims of £7.62m have been received which represents 85% of this forecast. These figures are subject to final assurance from Birmingham City Council as part of the quarter four submission to BEIS.
Grant to be Quarter Four Quarter Four managed using Project Forecast Actual Freedoms and £m £m Flexibilities £m Birmingham Energy Innovation Centre 2.90 2.90 Snow Hill Public Realm 1.82 0.47 1.35
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Unlocking Stalled Housing 1.45 1.45 Commonwealth Games 2022 1.00 1.00 Quantum Technology Innovation Hub 0.47 0.47
Cannock Chase Engineering Academy 0.29 0.29 PM Levy 0.24 0.24 5G Application Accelerator 0.24 0.24 Alliance House Redevelopment 0.19 0.19
Open House, REP 0.11 0.11 Old Print Works 0.10 0.10 Creative Content Hub 0.17 0.17 Total 8.98 7.63 1.35
Headroom 0.02 0.02 Q4 Target 9.00 7.63 1.37 Table 3: Quarter four 2020-21 grant forecast and actual claims (Source: Verto, subject to final assurance by Birmingham City Council) The Cannock Chase Engineering Academy reported a minor decrease of £0.20m in the overall grant requirement from the LGF programme without any reduction in outputs and outcomes expected from the project, however the timing of them has been slightly delayed. A change request to agree this variation was submitted and approved by the Interim Chief Executive. Approval, subject to the FBC, to utilise the headroom was agreed at the last Programme Delivery Board (PDB) meeting to support another skills project. The FBC for the West Midlands Creative Alliance digital learning hub project has now been submitted, which demonstrated high value for money and the £0.02m grant support was approved in May 2021 by the GBSLEP Chief Executive. The LGF programme has the ability to use ‘freedoms and flexibilities’ across other capital programmes to be able to ensure that it achieves its grant financial targets within a financial year. As previously reported, the only project that was not expected to achieve its full year grant draw-down by March 2021 is the Snow Hill Station Public Realm project, which suffered a delay to the start on-site and despite progressing well, will not complete before the end of March 2021. The estimated £1.35m of grant draw-down which has not been drawn to 31 March 2021 is being managed within the Accountable Body freedoms and flexibilities against EZ programme spend in 2020/21, along with the recently approved Digital Learning Hub project. The Programme Team costs and other professional fees associated with managing the delivery of the LGF and LGF (DfT) programmes are covered in the Programme Management Levy which has been drawn down in full including the closedown costs forecast across the first few months of 2021/22, in agreement with BCC.
Progress on Key Projects i. Snow Hill Public Realm - £4.66m grant The Snow Hill Public Realm project comprises a programme of sub-projects focused on public realm and public highway enhancements. The improvements to connectivity will improve the setting of Snow Hill railway station and the appearance of public realm in the historic Colmore area; enhance connectivity for active modes; reduce delays for all users outside Snow Hill Square; reduce vehicular flows along Colmore Row; and mitigate closure of
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selected highway links through reconfiguration and optimisation of the highway network. It comprises a number of phases with the first phase – Project 1.1 - Colmore Row and Livery Street receiving £4.67m grant support from the LGF programme. Work on this phase commenced on site in June 2020 and the photos below show that good progress has been made on site and works are due to complete in early Autumn 2021.
Scope of Snow Hill Project 1.1
Progress to 20 May - On the left: Paving to outside of Halifax bank and right: North footpath construction Works to the next phase Project 2.1 have commenced to transform Cornwall Street into a pedestrian friendly environment focusing on urban realm proposals encouraging businesses to spill out and make use of the road. This is being funded from external funding. Future phases are being funded from the Enterprise Zone programme and have not commenced yet. ii. Commonwealth Games 2022 - £20.00m grant The redevelopment of Alexander Stadium for the Birmingham 2022 Commonwealth Games, provides a game changing legacy for Birmingham, the GBSLEP region and neighbouring
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LEP’s. The new stadium is required to facilitate track and field events and ceremonies during the Commonwealth Games in 2022, whilst providing the catalyst for broader investment into the stadium site and wider West Midlands. Following demolition of the three existing stadium stands after planning permission was given in Autumn 2019, the main contractor was appointed, and construction work commenced in Summer 2020. The new roof and walling for the stand are taking shape, as shown in the photos below, with the completion of the stadium track and new seating anticipated in Winter 2021 with overall completion in Spring 2022. All LGF grant has been paid out.
Commonwealth Games project - Progress iii. Birmingham Energy Innovation Campus - £7.00m grant The Birmingham Energy Innovation Campus (BEIC) project is supporting the completion of a 1,788sqm applied research and innovation facility based at Tyseley Energy Park, Birmingham, supported by £7.00m of LGF grant. It aims to incorporate research, teaching and testing / validation space, and bring together a range of energy, waste and transportation capabilities as part of one multi-disciplinary team. After planning was approved for the building, work commenced on site in May 2020. The contractor has been working to programme with cladding nearing completion, M&E well underway, internal installations taking place and external groundworks underway. The building was due to complete on 26 April 2021, but it has been necessary to agree an extension of time with the contractor primarily to accommodate additional gas and ventilation works slightly delaying practical completion to 21 June 2021. The building is due to formally
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open in July and all LGF grant has been paid out.
BEIC - The Vision
BEIC Progress photos (May 2021)
iv. Alliance House Redevelopment - £0.25m grant A new external brickwork teaching workshop in the grounds of Heart of Worcestershire College’s Alliance House Campus will address the current limited capacity and allow for growth within Brickwork courses from level 1 to level 3, enable development of further Apprenticeship programmes and increase the number of bespoke employer programmes, part-time courses and programmes with the aim of upskilling local people to access higher level roles within the Construction Industry.
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Work commenced on site with the new learning space well underway as shown below. The photos show the “Inspiration walls” where patterning reflects the high skills application in brickwork. These will be used as both models for practice and as motivation for students to aspire towards. The planned scheduling of employer engagement activity will be created prior to the start of the academic year, in addition to the offer for adult courses. The final part of the build will be the installation of the curtain siding. The production of these, although ordered at an early stage of the project, have been hampered by BREXIT developments and also other increased demand for marquees over the COVID period, which increased demand on production lines and raw materials. These are expected to be installed by the May half-term time.
Alliance House project v. Creative Content Hub - £3.00m grant The recently approved Creative Content Hub project will see Oval Development convert five existing and partly derelict buildings at The Bond Company into a high-quality Creative Content Hub. The vision is to deliver a world class campus facility totaling nearly 50,000sqft. across five heritage buildings in the historic and creative quarter of Digbeth. It will be a flexible shared space for sector specialists to develop content, technology and business models to position the remaining independent TV companies in the region as future-facing
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businesses able to rapidly respond to the changing media landscape. The project aims to be the first major output for the new formal partnership between Create Central / West Midlands Growth Company (WMGC) and will deliver a home for the Creative Content Hub (CCH). The overall aim is to create a cluster of three hubs, which together will drive a renaissance of creative content production in the West Midlands and critically, to place this centre of excellence in close proximity to HS2 at Curzon Street, which is a short walk from The Bond.
Proposed development at the Bond Planning consent was granted in March 2021 and this project will unlock the delivery of the Creative Content Hub which will provide circa. 50,000sqft of modern, high quality office space. With the £3.00m GBSLEP funding, this space can be specifically designed to provide a space for diverse creative talent to work together to share technology and experiment with new ways of working and to provide a space for broadcasters and other content commissioners to engage with WM creative content producers. Vacant possession of the building was achieved on 10 May 2021 and internal strip out works have begun with the enabling works due to commence in early June and the main works contract to commence following completion of the enabling works. The refurbishment is forecast to be complete in May 2022. vi. Unlocking Stalled Housing Programme - £8.84m grant The final year of the LGF programme will see investment of £8.84m to unlock and develop 816 new homes across 26 developments in the GBSLEP area against an initial estimate of 580 homes when approval was sought to the programme in 2015. To date, 17 of these developments have been completed, totalling 539 homes, with a further two sites nearing completion and the remaining seven sites onsite and underway. vii. Redditch Gateway - £1.84m grant The new all-movements junction off the A4023 to unlock the north and south development areas of the Redditch Gateway was completed In November 202. The project was supported by GBSLEP grant funding of £1.84m along with Worcester LEP LGF funding of £0.91m. The first development on that site comprising of an Amazon facility is nearing completion with the external building work substantially complete, as illustrated below. The M&E works are underway with the conveyor system being installed and works to the additional Mezzanine structure progressing. The facility is expected to be practically complete at the end of August 2021 with opening anticipated on 13 October 2021.
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LGF Outputs and Outcomes All project sponsors have been contacted to obtain the latest position for achievement of outputs and outcomes for the LGF Programme and forecast to the end of the Programme, and to include in the BEIS quarter four return due to be submitted before the end of May 2021. This will be reported to the next PDB and Board meeting. Collection of outputs and outcomes beyond March 2021 will need to continue to March 2025 to report to BEIS. This is likely to be required on a six-monthly basis and reported via BEIS’s Delta system. There will need to be resources in place within the GBSLEP to ensure that this can happen.
LGF (DEPARTMENT FOR TRANSPORT RETURNED) FUNDING The Department for Transport (DfT) was notified in July 2020 of the decision to accept £21.85m of Growth Deal funding previously allocated by DfT to the A457 Dudley Road scheme, back into the Local Growth Fund. The grant agreement to formally accept the funding by BCC as the LEP’s Accountable Body was signed and the funding was paid to BCC on 3 September. The funding has the same conditions as the LGF programme and therefore has to be expended in full by 31 March 2021. With the support of a sub-group of PDB to consider and prioritise projects for investment to ensure they will both deliver in time to draw down this grant funding and achieve value for money, there has been significant progress made towards this.
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Following approvals of OBC and FBC’s, the programme of £21.85m is fully approved and the list of projects together with their latest grant forecast is shown in Table 4 below. A number of projects reported reductions in their overall project costs following approvals to their FBC’s, resulting in slight decreases to the grant amount needed. The total under-utilisation of these grant amounts has been allocated to the Creative Content Hub project, in order that it was not lost to the programme; with the allocation to the project from the Growing Places Fund programme being decreased by this same amount.
Grant Project Name Award (£m) University Station £0.700
Precision Health Technology Accelerator £1.199
A457 Dudley Road £5.043
Enterprise Wharf £5.000
Perry Barr Phase Two £1.600
Open House, the REP £0.150
Tyseley Incubator for Clean Energy (TICE) Phase 1 £0.892
Tyseley Incubator for Clean Energy (TICE) Phase 2 £0.020
Urban Carbon balancing Using Biochar £0.306
Surge (was £0.546m) £0.473
Junction Works £0.325
Institute of Technology (IoT) £1.680
Cadbury College STEAM Phase One £1.755
Lichfield Motion Capture Performance & VR Studio £0.337
Hippodrome Access All Areas (Phase One) £0.718
Hagley Road SPRINT Phase II (Development Funding) (was £0.230m) £0.197
NEC Longabout £0.460
Connected Autonomous Mobility £0.250
BMet Built Environment (Site Management) Academy £0.060
Creative Content Hub (was £0.238) £0.344
Programme Management Levy £0.342
TOTAL £21.851 Table 4: Approved LGF (DfT) Grant Investments in Projects
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The approved projects, excluding Creative Content Hub as the apportionment across the LGF and GPF programme is being finalised, will lead to additional outputs and outcomes estimated as follows: • 1,897 new/safeguarded jobs; • 12,008 sqm new/refurbished commercial floorspace; • 1,931 new learners; and • 4,895 sqm new/refurbished learning/training floorspace.
Financial Performance 2020/21 The risk of not all the £21.85m grant being expended by the 31 March 2021 deadline due to the tight timescales around this returned funding was discussed with BEIS and a sum of £3.60m has been formally approved to carry forward to 30 June 2021, leaving a target of £18.25m of grant to be claimed by 31 March 2021. Grant claims were submitted for £17.08m in quarter four bringing the total grant actually paid out to 31 March 2021 to £18.24m and represents 83.5% of the £21.85m programme total, and 99.9% of the amount agreed by BEIS of £18.25m to be claimed this financial year. A further £0.05m was agreed to be managed using the programme ‘freedoms and flexibilities. The outturn for 2020/21 after this additional amount is £18.29m This leaves a balance of £3.57m to be claimed in 2021/22. This is within the £3.6m agreed to be carried over to 30 June 2021 by BEIS. These figures are all subject to final assurance by Birmingham City Council as part of the quarter four programme submission to BEIS. Table 5 below summarises the actual claims received in 2020/21 and the amounts to be carried over into 2021/22.
Carry 2020-21 Over to Agreed Actual 30 June Project Grant Claims 2021 £m Received Forecast £m £m University Station 0.700 0.700 Precision Health Technology Accelerator 1.199 1.199 A457 Dudley Road 5.043 5.043 Enterprise Wharf 5.000 2.985 2.015 Perry Barr Phase II 1.600 1.600 Open House, the REP 0.150 0.150 Tyseley Incubator for Clean Energy Phase 1 0.892 0.892 Tyseley Incubator for Clean Energy Phase 2 0.020 0.020 Urban Carbon balancing Using Biochar 0.306 0.276 0.030 Surge (was £0.546m) 0.473 0.371 0.102 Junction Works 0.325 0.325 Institute of Technology 1.680 1.680 Cadbury College STEAM Phase 1 1.755 1.755
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Lichfield Motion Capture Performance & VR 0.337 0.217 0.120 Studio Hippodrome Access All Areas Phase One 0.717 0.401 0.316 Hagley Road SPRINT Phase II (was £0.230m) 0.197 0.197 NEC Longabout 0.460 0.295 0.165 Connected Autonomous Mobility 0.250 0.250 BMet Built Environment (Site Management) 0.060 0.060 Academy Creative Content Hub (was £0.238m) 0.345 0.058 0.287 Programme Management Levy 0.342 0.342 Total 21.851 18.241 3.610 Amount agreed to be managed using 0.054 -0.054 ‘freedoms and flexibilities’) OUTTURN FOR 2020-21 18.295 3.556 BEIS AGREED CARRY OVER AMOUNT to 3.600 30/06/21 Table 5: 2020/21 Actual claims received and 2021/22 carry-over forecast
Progress of Projects i. Enterprise Wharf - £5.00m grant The Enterprise Wharf project is a brownfield redevelopment located at the Innovation Birmingham Campus (IBC) to create 118,000 sqft of contemporary, flexible office space for ‘grow-on’ technology and digital businesses in Birmingham. Preliminary works, site clearance and enabling works have been undertaken, with the main contractor commencing groundworks in March 2021. The pile caps have been installed, with the ground beams nearly all in place with the concrete base now laid. The erection of steel is expected to start in June and the building is expected to complete in October 2022.
Aerial image of the proposed Enterprise Wharf building
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Progress on site with the concrete base laid and site hoardings up
ii. Tyseley Incubator for Clean Energy (TICE) Phase 1 - £0.89m grant The first phase of TICE is supporting the refurbishment of two acquired buildings to create 1,046 sqm of demonstration and incubation space to drive cutting-edge waste, energy and mobility solutions delivered by SMEs across the LEP area on the Tyseley Energy Park (TEP). The project has been delivered at great speed with practical completion achieved on 31 March 2021. iii. Cadbury STEAM - £1.75m grant Refurbishment of the East Block at Cadbury Sixth Form College as Phase 1 of Science City is underway to bring back into full time use 1,513 sqm of learning space to provide up to 23 new and updated classroom spaces designated for the delivery of STEAM.
iv. SURGE - £0.47m grant The Aston Institute for Urban Technologies and the Environment (ASTUTE) is supporting the development of smart urban technologies by regional SMEs, via the use of a specialised state-of-the-art autonomous vehicle control system and research platform. The vehicle has a 4 persons max capacity, 24kph top speed, range up to 100km on single charge, developed to ISO 26262 guidelines, capable of level 4 autonomy, navigating a route via pre-prepared map, conversion to level 5 autonomy possible, equipped with LIDAR, ultrasonic sensors, inertial navigation and GPS. The vehicle is being utilised to create an extensive suite of advanced prototyping facilities, which can be used by SMEs to rapidly develop new innovative hardware. Alongside this, SMEs will have access to sophisticated laboratories, latest knowledge, workshops, new qualification for SME staff, a network of smart urban technology companies and links into 5G technology.
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v. Lichfield Motion Capture Performance & VR Studio - £0.34m grant South Staffordshire College has made good progress with the Motion Capture project with flooring and infinity backdrops now installed. The motion capture equipment has been installed. Staff and students are really happy with the new facilities (as shown below) and the College believes that they will play a significant part in ensuring the department continues to move forward in supporting the regions digital and creative agenda. A Digital and Creative advisory group is set take place on the 25th of June to engage with local companies in the digital and creative sector and showcasing the new facilities.
Before (left) and After (right) installation of Harlequin Performance Floor, Curtain Greenscreen surround and installation of Motion capture system Staff had training on the 28 and 29 April on the motion capture system and are now working on planning projects with students using the new facilities from September 2021.
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Installation of the VR/camera equipment with Microsoft studio computers and software has been completed and students have been using the new machine. They have been able to use the pen system to manipulate images (as shown below). A training day for staff has taken place for future Adobe Qualifications exams, with some students starting to prepare for these after the May half-term.
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Before (left) and after installation (right) of the VR/camera equipment and Microsoft computers/software
vi. Urban Carbon Balancing Using BioChar - £0.31m grant Aston University is one of few UK centres of technical expertise in equipment to ensure that biochar can be produced and applied correctly to achieve carbon reduction objectives. It is also a centre of expertise in decision, supply chain and use case modelling, which will be used to ensure the maximum economic social benefits are achieved for the area, the industry and property companies. This project will work with Birmingham City Council (BCC) to use biochar in urban tree planting with local property developers and the construction industry to demonstrate how the carbon balance of new developments can be reduced to zero, build the local economy and support green growth and jobs. All the major items of equipment for the project have been delivered and construction of the demonstrator unit is well advanced. It is planned to commission the equipment and become operational in May 2021.
Virgin wood feedstock sourced from park and roadside management has been offered by Birmingham City Council, which has the advantage that there is a plentiful supply of material and the close collaboration with the City Council means that there is a range of opportunities for use in the area to support the Route To Zero objectives of the City. The feedstock provided by the City Council is seen as the primary source of material for the project. A number of site options are being explored with BCC. The project will work with at least ten sites to evaluate the opportunities and impact of biochar. vii. BMet Built Environment (Site Management) Academy - £0.06m grant The project is funding the redevelopment of the existing Hair and Beauty facility on the ground floor of James Watt College in Birmingham to create the Built Environment (Site management) Academy. It will create a ‘front of house’ professional space modelled on Higher Education facilities and offer dedicated teaching and break-out space. The Academy
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aims to deliver high-level, technical, vocational and leadership skills to meet Construction sector skills needs in Birmingham and the West Midlands. viii. Institute of Technology - £1.68m grant A consortium of four local education partners have come together and developed a new build Institution of Technology (IoT) with Cyber Physical Factory on the Aston University campus. Furthermore, they have refurbished and procured specialist digital equipment at four partner institutions. The four partners include Aston University, Birmingham City University, South & City College Birmingham, Solihull College & University Centre. The consortium will have designed, and developed education/training opportunities aligned to the latest skills needs of leading-edge employers and Government priorities for technical education including Industry 4.0. The project will address skills barriers by targeting under- represented learners, creating opportunities for progression from school to high-level occupations and upwards progressing above Regulated Qualifications Framework Level 3 to 4 and 5. The project will create 2,650 sqm of new learning/training floor-space including the education of 840 students to become skilled and qualified employees. ix. Connected Autonomous Mobility - £0.25m grant The Connected Autonomous Mobility is a path-finder project, responding to a specific market failure, that will see Solihull Metropolitan Borough Council (SMBC) purchase and subsequently flexibly provide one zero-emission Connected and Autonomous Vehicle (CAV) to organisations within Solihull and the wider West Midlands area to allow them to test future, mutually beneficial, CAV applications - trialling new services related to avoiding single occupancy vehicle miles and / or improvements to site / organisational productivity, alongside reducing CO2 emissions within their operation. The project is in the process of mobilising, preparing for the first deployment of the autonomous shuttle bus (pictured below). The project will work with private stakeholders to demonstrate application of the cutting-edge, zero-emission, shared transport solution, to both help companies better understand the technology and its value to their operation, and also help the Council better design future commercial and residential sites, and shared transport services, ready for automation.
x. Hippodrome Access All Areas (Phase One) - £0.72m grant The Access All Areas project aims to increase the visitor reach of the Hippodrome Theatre by
Page 17 of 26 Item 11 transforming public spaces, refurbishing internal areas and delivering new performance and education spaces, as well as a balcony overlooking Hippodrome Square. The first phase Phase One of the project comprises the creation of a new pedestrian entrance on Inge Street and is both an enabling project for the proposed overall re-development (Phase Two) and a series of measures to enable the venue to operate effectively and safely in a post-Covid environment. This will fundamentally reduce the pressure and reliance on the existing main entrance on Hurst Street and safeguard revenues by supporting Covid-19 operational restrictions and allowing the Hippodrome to maintain operational capability. Works are underway as illustrated below. The Hippodrome was able to re-open with a Van Gogh Alive exhibition on 25 May 2021. Delays have occurred as a result of differences between the existing structure and ‘as built’ drawings, following demolition of the main stair flight and due to the difficulty in obtaining the new structural steelwork for the new stairs due to supply shortages on a national scale. Work is now expected to be complete by 31 July. The external works have also been delayed due to difficulties agreeing road closures and obtaining the necessary approvals but have now commenced on 1 June. The initial phase to make sewer connections is expected to take two weeks with the footway widening and resurfacing to follow, subject to material delivery times. Any impact on the ability to draw down the remaining grant amount by 30 June is being discussed with the Hippodrome and measures to mitigate the risk to this.
Temporary staircase erected to enable Hippodrome to re-open to audiences for Van Gogh exhibition from 24th May 2021 while main staircase out of use
External pavement and hoarding line with view into Hippodrome where existing staircase removed and new steels going in to set main staircase at new level to match street level at new entrance
Page 18 of 26 Item 11 xi. Junction Works - £0.32m grant The Junction Works project aims to provide long-term, affordable and high-quality workspace and office space for local artists and small creative businesses in central Birmingham. The delivery of the project will secure the safety of the existing creative cluster in Digbeth and contribute to local regeneration that will be catalysed by the extension of the Birmingham Metro and construction of the nearby HS2 rail station. The project has commenced at risk but has been delayed due to the requirement for further loan funding (£0.18m), which was agreed in principle at the PDB meeting on 3 March 2021. Heads of terms for the additional loan funding has been agreed and the loan agreement is being finalised. The delay to agreeing the project funding has resulted in a delay to the delivery timescales of the project. There is a risk that it cannot be delivered sufficiently to drawdown its grant allocation by 30 June 2021. Once it is clear if this becaomes an issue and how much funding may need to be managed (likely less than £0.10m), the programme “freedoms and flexibilities” granted to the Accountable Body may need to be used.
PIPELINE The Programme Delivery Team maintains a pipeline of capital projects requiring funding. Due to the returned DfT funding to the LGF programme, the LEP was able to support a number of projects on the pipeline that met the tight funding criteria. There were more projects requesting funding than available funds, as well as projects considered for funding from LGF which were not able to meet this funding timescale. These projects are at various stages of development, with some at Expression of Interest (EoI) stage through to those with an Outline Business Case (OBC) or Full Business Case (FBC) approved, in readiness for when additional funding becomes available, when they would be ready to commence delivery. New projects are continuing to come forward for consideration and strategic fit assessments are being carried out on them to progress them onto the Programme Pipeline. Expectations are having to be managed as there is currently only a small amount of GBSLEP capital funding available, excluding Enterprise Zone funding. Development of the Enterprise Zone Investment Plan 2021 is underway. As part of the development process, a review of existing projects identified in the current investment plan and potential new projects will be undertaken, subject to compliance with the strategic and operational objectives of the Enterprise Zone programme. The current pipeline consists of the capital projects shown in Table 6 below. The figures may change and will be subject to verification as the projects develop to Full Business Case stage.
Grant Expected Project Outputs Project Stage of Development Project Name Funding and Outcomes (where Total £m £m known) 8,088sqm Floorspace: 62 FTE jobs(direct); FBC (Approved with BCR of M&P Hometel 1.7) 28.20 1.70 127 FTE jobs (indirect); £26.5m Private sector leverage FBC (submitted – ITE Westbourne Road Campus – BCU 4,750sqm learning space; completed) City South 31.78 15.00 1,488 new learners;
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312 FTE jobs Continuation of existing Unlocking Stalled Housing 800 new homes (TBC) approved LGF scheme programme 100.00 9.00 A457 Dudley Road Improvement FBC submitted – ITE completed TBC Scheme 29.94 16.81 FBC submitted (approved with Tyseley Incubator for Clean Energy 0.6ha Floodplain reclaimed BCR of 2.3) (Phase Two) 0.28 0.28 TBC depending on the Continuation of existing Mezzanine Loan Fund TBC TBC amount of GBSLEP funding approved GPF scheme approved FBC (Approved with BCR of Hagley Road Sprint Phase Two TBC 3.4) 3.89 3.25
OBC (FBC due) Grand Union Phase Two TBC 1.30 0.50
OBC (FBC due) Old Print Works Phase Two TBC 0.20 0.18 262 FTE (direct); Hippodrome Access All Areas Phase OBC (FBC due) 389 FTE Jobs (indirect); Two 9.00 5.50 GVA (GBSLEP) £45.0m 69,352sqm Residential Floorspace, (equivalent 1,300 Homes)
OBC in evaluation Martineau Galleries 155,061sqm Commercial 1,058.20 70.43 Floorspace 11,649sqm Hotel 8,890 Jobs FTE EoI submitted as part of TICE Tyseley Incubator for Clean Energy project - startegic fit assessment TBC (Phase Three) 2.00 1.00 completed 790sqm Office Floorspace; EoI Submitted – strategic fit The Place that Made the Weather: 14 FTE jobs (direct); assessment completed Joseph Chamberlain Highbury 8.60 0.78 15 FTE jobs (indirect); 5 Apprenticeships 300,000sqft floorspace; New jobs (no. tbc); EoI Submitted – strategic fit Nikal smART District TBC assessment completed 300.00 900,000 sqft+ Residential Floorspace (equivalent no. of Homes tbc)
TOTAL 1,573.39 124.43 20 hectares employment land PRE-PIPELINE unlocked; EoI Submitted – initial strategic A38 Branston Interchange assessment completed with Improvements 7.10 3.43 1,900 housing units; further information requested 70,000 sqm floorspace 400sqm learning floorspace PRE-PIPELINE (refurb); EoI Submitted – initial strategic Crafting the Future – Redditch 98 new learners; assessment to be arranged Construction Centre 0.11 0.06 1 new job; 30 new adult learners PRE-PIPELINE Up to 620 new apartments EoI Submitted - initial strategic
Curzon Wharf 940 New jobs assessment to be arranged 261.11 20.00 12,000sqm Life sciences facility
PRE-PIPELINE TOTAL 268.32 23.49 Table 6: Pipeline of Projects requesting capital funding
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Prospectuses for the £4billion Levelling Up Fund and the UK Community Renewal Fund (CRF)/Shared Prosperity Fund have been issued inviting the submission of bids into these funds from Local Authorities and WMCA and not through the LEPs. The prospectus for the Levelling Up Fund (capital) was issued in March 2021 with all areas in the UK able to access the fund. The Fund focuses investment in projects which require up to £20m of funding, with scope for larger value transport projects, by exception. The first round of the Fund focuses on three themes: smaller transport projects that make a genuine difference to local areas; town centre and high street regeneration; and support for maintaining and expanding the UK’s world-leading portfolio of cultural and heritage assets. The prospectus details the assessment criteria for bids and the decision-making framework with further guidance and templates for bid submissions, including packaged bids being provided directly to local authorities. The pipeline of capital schemes within Birmingham has been shared with BCC. Realistically, small bids that cannot be shaped into some sort of package of a tangible ask are unlikely to be prioritised. Therefore, it is likely that some of the smaller schemes above may miss out on being included in the submission for Levelling Up Funding. Two bids for CRF funding have been submitted to WMCA from GBSLEP. These are currently being reviewed by WMCA and GBSLEP is awaiting feedback on the bids. WMCA must submit the shortlist of projects to Government by 18 June 2021 with the announcement of successful projects to be funded from the CRF in late July 2021. The Finance Working Sub-Group (FWSG) has reviewed options to invest the remaining capital and revenue funding balances available to the GBSLEP. The funding balance available is currently estimated at £7.3m, consisting of £1.1m recycled LGF and £6.2m Growing Places Fund. A range of options have been explored including funding un-funded revenue projects and funding pipeline capital projects through grants, loans or a mix of grants and loans. A separate Board paper from FWSG, approved by PDB, recommends to the GBSLEP Board that the remaining funding balance should be utilised on high-priority revenue projects, high- priority capital projects (Junction Works and Open House REP projects), an amount retained as an operational contingency, with the balance of £2.2m available to invest in capital and revenue projects, with prioritisation following the normal PDB approval processes. There are a number of capital projects which could quickly take up this funding. These include projects with FBC’s already approved and/or due to be submitted. As there are more requests than funding is available, criteria to prioritise the pipeline would need to be agreed and the projects on the pipeline assessed against that criteria. This will be considered by PDB at the next meeting.
GETTING BUILDING FUND UPDATE The WMCA area was allocated £66m from the Getting Building Fund (GBF). From the £66m allocation, two projects are located in the GBSLEP area. These are the University Station project and the Precision Health Technology Accelerator (PHTA) project. The funding allocated to the GBSLEP to deliver these two projects via the WMCA is £14,829,500. This is made up of £3,969,500 for University Station and £10,860,000 for PHTA. The WM5G 5G Application Accelerator project will remain with the WMCA to deliver across the region but
Page 21 of 26 Item 11 does also cover the GBSLEP area. The £66m funding will be paid to WMCA from MHCLG. A back-to-back agreement for the £14,829,500 funding from WMCA to GBSLEP has now been signed. This now enables GBSLEP to contract with the project sponsors for the grant funding to deliver the two projects detailed above. All funding has to be expended by 31 March 2022 and any formal changes must be requested in writing to the WMCA and agreed via a change request with the relevant Government Department. Freedoms and flexibilities which the Accountable Body has in order to manage the capital budgets between programmes also applies to this funding. The £14,829,500 will be paid in two tranches with the first tranche received in December 2020. The second tranche of £6,925,685 has been received on 28 May 2021 from WMCA. The amounts making these tranches are shown in the Table 7 below:
Project 20/21 Grant (£) 21/22 Grant (£) Total (£) (Tranche One) (Tranche Two)
University Station 2,639,115 1,330,385 3,969,500
PHTA 5,264,700 5,595,300 10,860,000
Total 7,903,815 6,925,685 14,829,500
Table 7: GBF Annual Project Grant Allocation An amount of £25,000 has been paid as revenue funding to support GBSLEP to programme manage the delivery of the programme, and a sum of £12,625 contingency funding has also been paid. The revenue funding can be used to fund programme and project management costs and the contingency can be used in the delivery programme or to fund other capitalised costs associated with delivering the programme. The funding is to support the projects and secure the outcomes as set out in the Getting Building Fund announcement. The outputs and outcomes for the projects, which are apportioned to the GBF programme based on the percentage split between LGF and GBF are shown below in Table 8.
University Station PHTA
Project GBF Project GBF Apportioned Apportioned Total Total Project Project Output/Outcomes Forecast Forecast
Direct Jobs Created 30 20 502 389
Construction Jobs Created 100 100 310 310
Commercial Space Unlocked 1,585 1,585 11,100 8,610 (sqm)
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No of businesses / institutions 0 0 955 741 assisted
Area of new/ improved 0 0 147 114 learning/training floorspace
No of new learners assisted 0 0 1,080 838
No of retrofits delivered 1 1 0 0
CO2 Emissions Avoided (kg) 1,183,876 1,183,876 0 0
Public Realm or Greenspace 5,000 5,000 0 0 improved or created (sqm) Table 8 – Latest Project Output and Outcomes Forecasts
Financial Performance The full grant amount of £3.97m for the University Station project was paid in March 2021 and £0.03m paid in March 2021 for the PHTA project. The revenue and contingency funding elements were drawn down in 2020/21. The latest actual and forecast grant profile for the two projects is shown below in Table 9.
2020/21 (£’m) 2021/22 (£’m) £’m GBF FORECAST Grant GBF Managed Outturn Grant Managed Paid to Forecast Project using Reported Payments to Using Total GBF Reported F&F to GBF Projects F&F Projects to MHCLG MHCLG
University 3.97 0.00 3.97 0.00 0.00 0.00 3.97 Station
PHTA 0.03 3.90 3.93 10.83 (3.90) 6.93 10.86
Total 4.00 3.90 7.90 10.83 (3.90) 6.93 14.83 Table 9: Latest Project Actual and Forecast Capital Grant Profiles
As illustrated in the table above, the balance of the £7.90m capital funding is being managed using the programme ‘freedom and flexibilities’ granted to the Accountable Body, to ensure that the grant awarded to 31 March 2021 was also expended in full by that date. The PHTA project is forecasting to drawdown the GBF grant in full by 31 March 2022.
Update on Projects
i. Precision Health Technology Accelerator - £10.86m grant The Full Business Case (FBC) and £14m grant investment for PHTA was approved in September 2020 towards the £94m life science project. This will create 11,000 sqm innovation space in a building which will be the catalyst for the wider four-hectare Birmingham Health Innovation Campus. The development of the campus will be delivered through a long-
Page 23 of 26 Item 11 term collaboration between the University and a leading property provider for the science and technology sector: Bruntwood SciTech (a 50/50 joint venture between Bruntwood and Legal & General). Grant agreements have been completed for the £14m grant made up of £3.14m LGF, which has already been claimed and the balance of £10.86m GBF which has to be claimed in full by 31 March 2022. The planning application for the enabling works comprising earthworks and site levelling, drainage infrastructure, erection of a primary substation, site compound, site access road and temporary surface and car park to base course and below ground services and associated development, was submitted by Bruntwood SciTech on 8 October 2020. Consent was given to this on 2 February 2021 with conditions. Enabling works commenced in early May 2021. The latest programme from Bruntwood as discussed with the contractor is now forecasting a minor slippage with the building now scheduled to be completed in August 2023 (previously reported June 2023). This delay reflects the slippage in obtaining planning consents and from a more robust forecast programme from the contractor.
Image of completed PHTA building
Commencement of enabling works
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ii. University Station - £3.97m grant The FBC for University Station was approved at PDB (28 July 2020) for a total grant of £8m (which includes £2m development costs previously approved and claimed) towards the £56m total project cost. This project is being funded through a combination of GBF £3.97m and LGF £2.03m funding (excl. development funding) and grant agreements have been finalised to reflect this, with all the GBF and the LGF grant funding having been paid in full. The University Station project will see the transformation from a category B station built in 1978 and designed to accommodate 0.2-0.5 million passengers per year to category D station designed for the long-term capacity requirements accommodating up to 10 million passengers per year, as well as new wider platforms, a second footbridge over the railway line and footbridge over the canal into the University of Birmingham campus. Works are underway with the construction contractor VolkerFitzpatrick on site. The planned physical upgrade works are now forecasting to complete in July 2022 which is three months later than previously reported. This is mainly due to some further design works to progress from GRIP 4 to GRIP 5 (detailed design stage). Options are being explored to mitigate the challenges with the design programme and risks which may be encountered with any delays to Entry into Service which may impact on operational readiness for the CWG in July 2022.
CONCLUSION
There has been a very strong financial performance in the final and most challenging year of the LGF programme. Having overachieved in each of the first three quarters of the 2020/21 year, only £9.00m remained of the programme to be claimed in the final quarter to ensure that the LGF programme is fully expended by 31 March 2021. The use of programme ‘freedoms and flexibilities’ was necessary to manage £1.37m of grant beyond 31 March 2021 to be able to report full programme defrayment to BEIS in the quarter four return which is due to be submitted before the end of May 2021. The remaining key tasks are to complete the assurance of the financial performance with BCC and to continue to monitor the outputs and outcomes to ensure that the LGF programme is closed-off in a timely manner and that the outputs and outcomes which Government has funded are delivered. Acceptance of the returned DfT funding to the LGF programme provided a great opportunity to support a number of projects which otherwise would not have been able to commence. Excellent progress was made to ensure that the programme was fully approved, contracted and the majority of projects making good progress in delivering against their agreed programme. Approval was given to carry forward £3.60m to 30 June 2021 and with the exception of £0.054m this was achieved in full to allow the programme to be expended in full by then. There is only one project at risk of not drawing down their agreed grant by 30 June 2021 and the Programme Team is liaising closely with the Project Sponsor to monitor progress. The WMCA and the three West Midland LEPs were allocated £66m from the recent £900m Getting Building Fund. Of this, GBSLEP has been allocated £14.83m to contribute to the delivery of two key schemes for the area, namely University Station and PHTA. Grant of £4.00m has been claimed to 31 March 2021, with the 2020/21 balance of funding (£3.90m) being managed using the Accountable Body programme ‘freedoms and flexibilities’. Progress
Page 25 of 26 Item 11 is being made on both projects, with no issues currently identified that may impact on the ability to drawdown the remaining GBF grant in full by 31 March 2022. Progress reports on these two projects are being reported regularly to PDB, the WMCA and BEIS.
Report by: Kerry Billington, Interim Programme Consultant Contact: [email protected]. 07711 314375
Date Created: 21 May 2021
Reviewed by: Keith Mitchell, Interim Finance and Transformation Consultant Date: 25 May 2021
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GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10 June 2021
Plan 10,000 Plus Update/Work Academies
Recommendations
Board Directors are asked to:
1. Note the activity of the LEP Skills Team to date and progress made toward the achievement of Plan 10,000 Plus objectives: a. Including the flexibilities adopted and implemented in the wake of the Covid-19 pandemic b. Focusing on the activity in relation to the Work Academies/capital pipeline priority within the Plan.
Background
2. It is GBSLEP policy to close the gap between the qualification levels of working-age residents at NVQ Level 3+ (A-levels and vocational equivalents, and higher) to those of the national average. This responds to increasing employer demand for higher skilled staff in order to remain competitive in the face of economic changes, and to help drive economic growth and productivity levels. Both the Employment and Skills (ESB) Board and main LEP Board have agreed that a greater intensity of activity is needed to achieve this ambition and address the skills gaps.
3. The LEP Board received a report from the ESB on 6 June 2019 that detailed the development of a “Plan 10,000 Plus” with eight key areas of concentrated focus to increase the cohort of learners commencing NVQ 3+ qualifications in the Greater Birmingham and Solihull LEP area. The eight key workstreams are: i. Apprenticeship Hub – Increasing Apprenticeship starts and supporting employers through the apprenticeship process ii. Growth Hub – Improving skills related support to businesses via the GBSLEP Growth Hub iii. Work Academies – Increasing the number of Work Academies and employer-led short courses in the LEP geography. This will form the major theme of this report. iv. Strategic Leadership – Strengthening GBSLEP strategic leadership, cross- institution collaboration and political lobbying (recently GBSLEP has worked with our LEP partners to deliver the Midlands Opportunities Skills and Jobs portal) v. Joint Provider Planning – Future planning of apprenticeship provision with regional training providers
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vi. Graduate Attraction – Increasing the number of graduates resident in the region. vii. Adult Participation – Increasing post-24year-old levels of upskilling with focus on those in employment. viii. Experimental Approaches – Increasing the number of new skills approaches to meet emerging and predicted skills needs.
4. In line with the GBSLEP Strategic Economic Plan (SEP) the “Plan 10,000 Plus” will focus on the key economic sectors identified in the SEP.
5. The LEP Board of 6 June 2019 approved £1.93 million of funding from the SEP Enabling Fund to be set aside to enable delivery of the Plan 10,000 Plus. This decision was formally noted by the 20 June 2019 Supervisory Board.
6. At the October 2020 ESB, it was agreed that delivery and spend flexibilities be allowed to enable the programme to both address the impact of Covid-19, and aid the associated recovery, while aiming to deliver the overall aims of Plan 10,000 Plus. Despite the impact of Covid-19 the continuing need for higher level skills across the local economy is highlighted as a necessary driver for recovery and future prosperity. Various initiatives and activities have been taken forward by the GBSLEP Skills Team to address both the need for higher level skills in the context of a post Covid- 19 recovery.
Key Issues: Progress to date
7. Plan 10,000 Plus has made significant progress across several of the 8 strands. However, the COVID-19 pandemic has impacted some of the work to date and the potential future activity of the Plan. Progress made to date is set out below :
Skills and Apprenticeship Hub
8. In recent months the delivery of Apprenticeship Hub activity and associated outcomes has accelerated, both around staff recruitment and physical delivery. The Hub has seen the vast majority of Plan 10,000 Plus activity and spend over recent months as this has been the main GBSLEP vehicle for skills focused Covid recovery activity. Updates will continue to be provided to the board but current activity levels show:
• 367 local businesses engaged • 109 Training needs analysis completed by local businesses • Kickstart - 59 employers have been referred to Gateway Organisations, - 98 Kickstart placements in total - 75 placements approved by DWP - 23 placements pending approval. - 53 placements in pipeline.
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• 20 employers referred to Apprenticeship Providers (providing 34 individual apprenticeship referrals of which 27 are at Level 3+, almost 80%) • 5 employers referred to ESF-funded provision (SSW, SSP etc.) • 2 employers referred to Higher Level Skills Solutions • 3 employers referred to AEB-funded provision.
9. As shown, a focus of the Hub’s referrals is Level 3 and higher provision and this will be collated and reported back when further outcomes of such referrals are known.
European Social Fund (ESF) Call December 2020 – Apprenticeship and Skills Hub
10. As agreed by GBSLEP Main Board and Employment and Skills Board (ESB), a GBSLEP-wide Skills and Apprenticeship Hub ESF proposal, valued at £2,332,000 (including Flat Rate Indirect Costs), was submitted to DWP on 02 March 2021.
11. If successful in securing ESF, the project will increase the Skills Hub staff roles and extend its activity to the end of 2023. New staff roles include: additional skills and apprenticeship advisors, new business advisors, marketing and events professionals, a compliance manager and project co-ordinators covering specific priority actions such as enterprise and entrepreneurship, BAME skills priorities, graduate interventions, etc.
12. DWP has already started the appraisal process and GBSLEP are currently responding to further clarification details requested. At the time of writing ESF appraisal to ESIF sub-committee members was underway with a deadline for comments of 01 June 2021.
Work Academies and Capital Pipeline
13. As previously noted, some of the Plan 10,000+ budget (including that of the Work Academies theme) was used to part fund the Step Forward Phase 2 Skills Innovation Covid-19 response. The interventions funded through Plan 10,000 Plus were those that also delivered outputs at Level 3 and above; as well as the Work Academies budget line funding was also used from the Adult Participation and Experimental Approaches themes. An ‘open call for innovative expressions of interest’ was carried out during September 2020.
14. Through the call, 36 EOIs (Expressions of Interest) were received from 26 different organisations, covering a wide range of sectors and priority areas. An initial internal eligibility and appropriateness check reduced the number of priority proposals to 16 totaling £2.583m of grant requested. Ultimately, through an open and transparent process, eight were selected to receive funding for the year 2021/22. These eight projects are:
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Project Sponsor 1. GB Ladder Skills Academy* PTP Training Limited 2. Generation 2022* Birmingham Organising Committee for the 2022 Commonwealth Games Ltd 3. Enterprise Events* Solihull MBC 4. Immersive Storytelling: Building Capacity Birmingham and Solihull Training Across Further Education* Provider’s Network 5. Head Space: The Creative Growth Hub Creative Alliance for Emerging Creatives* 6. The Greatest Growth Development Enterprise Made Simple Programme* 7. Digital Innovators Launch Pad* Digital INnov8orsLtd 8. Solihull Careers Hub Solihull MBC
* Funded, at least in part, with Plan 10,000+ resources
15. Within these submissions Plan 10,000 Plus activity covered includes enterprise creation and entrepreneurship support, digital skills provision at all levels to meet sector needs, specific models to address skills issues within the creative sector, graduate retention and progression initiatives etc. A full list of proposals received is highlighted at Annex A.
16. The funding initially identified for these eight projects is £379,500 and the projects collectively will achieve the following outputs (campaign targets in brackets):
• 950 individuals supported (300) • 130 apprenticeships created (100) • 175 (all at Level 3) qualifications delivered (200 – level not specified) • 2 direct new jobs created • 1000 social action placement opportunities created for those aged 16-24 • 220 businesses supported • 18 jobs safeguarded.
17. These eight identified projects received ESB approval (by written procedure on) 26th March 2021.
18. GBSLEP Executive officers are currently engaging with all associated sponsors in contract discussions and these should be finalised shortly. The discussions are also focusing on maximising additional Level 3+ outputs wherever possible. All sponsors have been given the go-ahead to begin delivery (at risk to the project sponsors until contracts are agreed) from 01 April 2021 to allow for the maximum in-year delivery time.
19. Other projects/sponsors that were not immediately successful through this procurement process are also involved in discussions, to see if funding can be jointly
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developed. In particular where these proposals are of strategic importance or crossed the funding cut-off. This includes discussions with HE partners to develop an intervention around graduate attraction and retention. This will be developed in line with the previously noted ESF proposal to maximise resources to this key initiative and will focus on the attainment priorities stipulated through Plan 10,000 Plus.
20. Alongside this proposed HE intervention GBSLEP is also commissioning a Virtual Graduate Fair on the 16 June, supported by 10 regional universities. The aim of the intervention is to connect the region’s SMEs (priced out of typical university recruitment) to the region’s graduates (who overlook SMEs as employment opportunities). SMEs looking to hire permanent positions as well as Kickstart placements will be invited. This project is the first of its kind to get buy-in from this many universities, offering a mixture of traditional and vocational degrees. The project will cost £4000 (funded equally between Skills and Health Tech) which will buy 40 employer slots and marketing from the digital platform.
Other Sector Focused/Employer Led Initiatives
21. In addition to the procured activity the GBSLEP Skills Team has been working with our sector colleagues to develop employer led initiatives that will contribute towards the overall attainment of Plan 10,000+ objectives. These include:
Science Industry Partnership
22. The Health Technologies Science Industry Partnership (SIP) developed in conjunction with Cogent Skills will see the development of a West Midlands employer led partnership of business and academia to deliver skills solutions to meet employer need. These will be primarily focused on apprenticeship provision and graduate retention and progression and will likely all focus at provision above Level 3 (most Health Tech employees require a degree and higher; more than 62% of employees within Life Sciences hold a degree or equivalent level qualification (Levels 6 and 7+), this compares to approximately 36% of the wider UK workforce. Only around 15% of the national workforce is qualified below Level 3.
SuperTech Academy
23. In partnership with high level data specialist provider Cambridge Spark, GBSLEP is developing the Supertech Academy. This will see cohorts (likely 10 each) of employees trained in data analytics at Level 4 and Level 7 to satisfy the high-level digital and technology requirements of business.
Capital Pipeline
24. Within the Work Academies theme of Plan 10,000 Plus there is an intention to create capital build facilities to deliver high level learning opportunities, in line with employer opportunities, to individuals across the GBSLEP area.
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25. This intervention proved difficult due to the limited resources available through the GBSLEP capital programme in 2020/21. This situation altered slightly with the release of limited funds through the Getting Building Fund opportunity which enabled an initial pipeline of capital skills projects to be developed.
26. Although, due to very limited resources ultimately being available, no skills interventions formed part of the GBF portfolio, the pipeline created enabled the Skills Team to react quickly to any capital funding opportunities that became available at short notice. Some such opportunities were created due to underspend capital funds being returned and projects from the skills pipeline were able to be taken forward.
27. The following skills capital projects were brought forward and have received funding noted through this recent opportunity: • Institute of Technology Phase 1 (Solihull College and University Centre) - £1,680,000 • STEAM Centre Phase 1 (Cadbury College) - £1,754,791 • Litchfield Performance Capture Performance and VR Studio (South Staffs College) - £337,000 • Built Environment (Site Management) Academy (BMet College) - £60,000
28. Through these recent interventions £3,831,791 of capital funding has been awarded to skills projects in the GBSLEP area. These projects aim to deliver over 2,300 new qualifications at Level 3 and higher over the programme period. A full breakdown of the projects is noted at Annex B.
29. Several of the projects awarded funding are Phase 1 developments and will be followed by further capital build activity (funding permitting) to generate more skills outputs. All projects will continue to generate outputs at Level 3 and higher that will meet the targets of the Work Academies theme of Plan 10,000 Plus.
30. The skills capital pipeline is still being developed to take advantage of new funding opportunities (when available) or the headroom that may still exist in capital programmes on a much smaller scale. To this end additional resources are currently being sought for the West Midlands Creative Alliance Digital Learning Hub (£25,000 grant, £50,000 total project cost) and additional resources to expand provision at the Heart of Worcestershire College Redditch Construction Centre. With these additions it is anticipated that Level 3+ outcomes will increase by 2,650 per annum.
Plan 10,000 Plus Budget
31. Due to delays in starting Plan 10,000 Plus activity project, spend has been behind profile since the project start. Increased Skills and Apprenticeship Hub activity in recent months has seen Plan 10,000 Plus related expenditure begin to rise and reflect the profiled spend.
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32. A full breakdown of spend, and conservative projections for the rest of the year, is provided at Annex C. To the end of March 2021, £157,857 had been spent on Plan 10,000+ expenditure through these interventions.
33. As highlighted, through the procurement activity and other skills interventions it is anticipated that Plan 10,000+ spend will meet the projected profile in 2021/22. It is also important to note that Plan 10,000+ funding provides the match funding necessary to draw down the ESF funding (if secured) to deliver the wider Skills and Apprenticeship Hub brief and full outcomes and objectives.
Summary
34. To date, in summary, the following progress has been made towards the achievement of Plan 10,000+ targets covered by this report:
Workstream Activity and Progress
Skills and Circa 400 employers/SMEs engaged and supported Apprenticeship Circa 80% of apprenticeship and skills referrals at new Level 3+ Hub An additional £1.2m of ESF funding is close to being secured to enhance and expand this provision Work Academies Employer-led projects funded through Skills Innovation procurement, including: • Digital, creative and cultural • Enterprise and Entrepreneurship • 220 business supported • At least 175 new Level 3+ qualifications to be delivered Specific Health Tech (SIP) and BPFS (SuperTech Academy) interventions targeting new Level 3+ provision also supported Capital Pipeline Despite reduced capital funding availability: • Almost £4m skills projects funded • 4 new projects approved, 2 continuing appraisal • 2,650 new Level 3+ qualifications supported
Conclusion
35. The delivery of Plan 10,000 Plus is still of paramount importance to GBSLEP and, despite delays in start-up and staffing, budget changes and other factors such as Covid 19; good progress has been made.
36. The impact of Covid-19 on the local economy, and the skills environment, is a key factor that both obstructs progress and creates opportunities to meet skills needs created through the recovery. This has also led to some changes in skills priorities and activities that have been accommodated through approved flexibilities in Plan 10,000 Plus funding.
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37. The implementation of Plan 10,000 Plus has also been impacted by reductions in capital funding availability and in future budget allocations that will hopefully be offset, in some ways, by the attraction of ESF resources. The slower than anticipated start-up and initial impact of the Skills and Apprenticeship Hub (partially due to Covid related refocusing) has also affected performance; additional ESF resources will directly impact here.
38. The GBSLEP Skills Team will work with LEP Executive colleagues and external partners to develop solutions that not only deliver the key aims of Plan 10,000 Plus, but also mitigate the impact of Covid-19, and equip our businesses and economy with the skills necessary to recover and thrive in new economic circumstances. To this end significant progress has been made to date and, through additional ESF supported delivery, this will continue throughout 2021/22.
39. Progress will be reported back to each ESB for consideration and necessary approval, with such approvals acting as recommendations to GBSLEP Main Board.
Report by: Spencer Wilson Head of Skills
Contact: [email protected] 07483 079 298
Date Created: 21/05/2021
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Annex A
GBSLEP Skills Procurement Exercise Appraisal, Ranking and Financial Breakdown
Appraiser Appraiser Appraiser Appraiser Year one Cumulative 1 2 3 4 Total Ranking costs total GB Ladder Skills Academy 2 1 1 8 12 1 £60,000 £60,000 CWG2022 6 5 2 2 15 2 £37,500 £97,500 Enterprise Events 3 2 11 4 20 3 £25,000 £122,500 Immersive Storytelling: Building Capacity Across Further Education 1 7 16 1 25 4 £52,000 £174,500 Head Space: The Creative Growth Hub for Emerging Creatives 4 4 13 6 27 5 £30,000 £204,500 The Greatest Growth Development Programme 5 3 17 4 29 6 £50,000 £254,500 Digital Innovators Launch Pad 11 6 9 5 31 7 £100,000 £354,500 Solihull Careers Hub 10 8 7 7 32 8 £25,000 £379,500 The Serendip® Ideator Pilot: Harnessing innately digital talent 8 9 10 9 36 9 £150,000 £529,500 Graduate Excelerate 7 11 3 16 37 10 £150,000 £679,500 Growing Talent #KeySectors 12 10 4 14 40 11 £110,000 £789,500 Greater Birmingham & Solihull Institute of Technology Outreach and Learner Engagement 9 13 14 11 47 12 £163,000 £952,500 Women in Tech - AWS re/Start Programme 15 14 5 13 47 13 £200,000 £1,152,500 Retrofit and AMC ‘Employability and Skills Village’ Pilot 16 17 6 10 49 14 £75,000 £1,227,500 Start Up Plus 13 12 8 17 50 15 £150,000 £1,377,500 The Hacking Lab 14 16 12 12 54 16 £400,000 £1,777,500 Home Grown 17 15 15 15 62 17 £40,000 £1,817,500
Approved Financial cut off Unsuccessful
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Annex B Capital Pipeline
Project Name Institution Grant Ask Project Value
Institution of Technology Solihull College & University Centre £1,680,000 £4,080,000 Phase 1
This project seeks to enhance and embed the digital links required between the partners to ensure parity of access for all IoT learners across the region; the project will invest in digital infrastructure for each IoT ‘spoke’ to maximise the effectiveness of the Capital Investment committed through our Department for Education funding within the Hub.
Outcomes to be delivered include: • 1 job and new 2,642sqm of teaching space by September 2021 • Learner targets at Level 3 and above: o Level 3 : 61 o Level 4 : 178 o Level 5 : 271 o Level 6 : 330 o Total: 840
STEAM Centre Cadbury College £1,754,791 £3,509,583 Phase 1
The aim of SCIENCE CITY is to support the development of talent across STEAM related subjects: digital, engineering, Multi-media software/applications, Construction Design, Health and Professional Services as well as offering space for enterprise and business development.
Substantial ‘refurbishment’ of ‘East Block’ including a series of classroom to include delivery of ‘digilabs’ and elements of the profession’s academy – East Block would then have designated with STEAM focus. This would provide a ‘Phase 1’ approach designed to deliver an outcome by March 2021.
Outcomes to be delivered through Phase 1 include:
• 1,513sqm refurbishment by 31st March 2021 • Increased 16-18 L3 Volumes, c150-250 learners maximum • Increased HE Volumes/Higher Apprenticeships, c50 students • Increased Employed Adult, including job outcomes, c100learners • Increased Pre-16 Schools’ Engagement, 350 Pupils • Jobs Created/Safeguarded, 10 employees • Businesses Supported through Industrial placements, 25 Businesses
Litchfield Motion Capture South Staffordshire College – Performance and VR £337,000 £674,000 Lichfield Campus Studio The LMCPVRS is based on the principles of innovation and creativity and how as a college we are
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looking to enhance and strengthen the potential of our students in using emerging technologies, influencing, and empowering the regionals creative workforce capacity for the future.
Outcomes to be delivered include:
• 155.4sqm refurbishment by April 2021 and further 1500 learners in L2-L6 by 2026/27 o Level 2 – 341 o Level 3 – 1,093 o Level 4/5 – 65 o Level 6 – 60
Built Environment BMET College £60,000 £120,000 The project will create a Built Environment (Site Management) Academy at James Watt College in Birmingham. The Academy will deliver high-level, technical, vocational and leadership skills to meet Construction sector skills needs in Birmingham and the West Midlands.
The project will address identified construction sector skills shortages by developing a supply (talent pipeline) of skilled site-managers. It will focus, not only developing technical competence, but also on the attributes and characteristics needed to enter industry in this role.
The project will create a place for innovation to flourish. It will develop the digital talents of students, with digital skills acting as a ‘golden thread’ running through the whole curriculum offer.
The facility will be a higher-level skills progression point for learners entering the college at a lower level (e.g. via the construction trades facility at Erdington); this may include NEET and unemployed learners.
Outcomes to be delivered include:
• 185sqm refurbishment by 31st March 2021 • Further 150 learners by September 2023 • 64 new Level 3 apprentices by September 2023 • 80 jobs created/safeguarded • 90% Progression into employment/further study
Currently being appraised – awaiting approval
Digital Learning Hub West Midlands Creative Alliance £25,000 £50,000 A digital learning hub for creative, digital and marketing apprentices and pre-apprentices on kickstart placements. Companies can transition out of Covid-19 lockdown restrictions and simultaneously provide, in real time, classroom and on-line teaching, learning and assessment. This will create the technical infrastructure and support to enable the delivery team to run training sessions, seminars, tutorials and observations to 25 apprentices and Kickstart placements in the 2021/22 academic year.
Outcomes to be delivered include: • 180 Level 3 apprentices • 120 Kickstart Placements • 150 Adult learners on Digital Skills for Business courses
Crafting the Future – Redditch Construction Centre Heart of Worcestershire College This project is designed to rapidly capitalise on opportunities for increased capacity for craft trades at
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the Alliance House created by the Brick Workshop Project – Alliance House development, supported by GBSLEP. The internal refurbishment of the newly created space to designate specialist areas for Plumbing, Plastering and Carpentry. This will increase the currently limited places available for employed learners, adults and 16-18 year olds. Provision is currently limited due to the internal structure. This increased learner capacity, within the same footprint, will also cater for the rise in demand catalysed through the new Adult L3 offer, the bounce back in apprenticeship demand and the increase in local 16-18 demographics. These new facilities enhance the understanding and skills for sustainable principles and practice in these craft trades and their application in housing and industry. These developments will boost the supply of skilled crafts in the region, under-pinning the West Midlands area’s potential to deliver on the “Build Back Better” post - COVID initiatives and the GBSLEP growth plans, for increased housing supply and regeneration.
• 98 new level 1, 2 and 3 learners • 400m² of new training space created
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Annex C Plan 10,000 Plus Budget
Forecast Actuals
2020/22 Actuals and Available to Plan 10k+ 2020-21 Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 Oct-21 Nov-21 Dec-21 Jan-22 Feb-22 Mar-22 Budget Forecast spend
1. Apprenticeship £12,608 £12,608 £12,608 £12,608 £12,608 £12,608 £12,608 Hub £480,000 £112,021 £12,608 £12,608 £12,608 £12,608 £12,608 £263,317 £216,683 2. Growth Hub - including BEIS £285,000 £45,836 £7,836 £7,836 £7,837 £7,838 £7,839 £7,840 £7,841 £7,842 £7,843 £7,844 £7,845 £7,846 £139,922 £145,078
3. Skills Innovation £440,000 £0 £53,500 £24,500 £15,000 £51,666 £36,000 £12,500 £51,166 £32,300 £12,000 £80,868 £369,500 £70,500 3.1 Work £53,500 £24,500 £15,000 £40,000 £12,500 £35,300 £69,200 £250,000 Academies 3.2 Experimental £11,666 £36,000 £15,866 £32,300 £12,000 £11,668 £119,500 Approaches
4. Graduate Attraction £20,000 £0 £2,000 £2,000 £18,000 Total Budget £1,225,000 £20,444 £20,444 £75,945 £44,946 £35,447 £72,114 £56,449 £32,950 £71,617 £52,752 £32,453 £101,322 £774,739 £450,261
03/06/2021 13 of 13 Item 13 The Grand Hotel Birmingham 10 June 2021 Kerry Billington Background
Before the 1870’s, St Philip’s churchyard was surrounded with Georgian terraces
The buildings were cleared for the redevelopment of Colmore Row Background
Grade II* listed Victorian Hotel in Birmingham City centre Overlooks St Philip’s Cathedral and churchyard Land for the hotel acquired by Isaac Horton, Designed by architect Thomson Plevins Background
Hotel opened 1 February 1879 100 rooms, a further 60 unfinished, restaurant fronting Church St, 2 coffee rooms and exhibition space Let to hotel operator Extended in 1880 Handed back to Hortons’ Estate Ltd Extensions and interior renovations undertaken by Martin & Chamberlain(1890-95) incl. the Grosvenor Room, and 75 new bedrooms Background
During its heyday in, the hotel played host to many famous guests King George VI, Winston Churchill, Neville Chamberlain, Charlie Chaplin, James Cagney Despite its successes and various transfers of ownerships, the hotel fell into decline Finally closing its doors in August 2002 due to financial difficulties The 'Project'
Building exterior began to deteriorate The Building was designated with a Grade II* listing in May 2004 protecting it from demolition The 'Project'
Planning permission and listed building consent grant in 2012 Growing Places Fund application submitted in October 2012 Estimated costs £45m+ Façade repair works were underway Listed building status and abnormal costs to redevelop the hotel and refurbish original features The 'Project'
GBSLEP approved £5m GPF in 2015 £3m repayable grant, £2m non-repayable £1m BCC repayable grant approved The 'Project'
£45 million project to restore the Grand Hotel back to part of the fabric of Birmingham Progress
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To this... And now Practical completion October 2020 Due to lockdown restrictions, opening delayed until May 2021 Prominent position for visitors and business guests Spectacular views across the City And now
Mix of French renaissance, Victorian and Art Deco features 185 bedrooms including 15 suites and 2 penthouses New bar and restaurant Rooftop garden terrace 10 event spaces with state-of-the-art meeting rooms Historic Grosvenor Ballroom Written Procedure Item 1
ACTIONS LOG
The Actions Log is a record of actions agreed upon to support Board decisions. It provides an indication of the progress made against each action.
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
06/06/2019 7 Assurance Framework to LEP Executive/ BCC After In Progress Initial discussions have taking be amended to provide Consultation with place with BCC, with initial draft clarity over the ability to BCC has been produced.
award capital funding LEP Executive reviewing draft for the development of to ensure that it is required business cases only after given financial position of the further consultation capital programme. with the Accountable Body
18/07/2019 17 Medium Term Financial LEP Executive March 2020 Closed Until we understand the Plan to be updated and outcome of the LEP Review, the presented to the Board Revised to Later Medium Term Financial Plan can only cover the year 21/22, meeting once future in 2021 as we do not know the basis for funding streams are 22/23. The Budget for 21/22 is confirmed an item on the Agenda for the April Board. Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
21/11/2019 3 Discussion on Return on Programme During Q1 2020 In abeyance awaiting Discussion not yet convened Investment to include Delivery Board (Updated Q4 LEP Review outcomes. due to other time pressures but LEP participation in 2020) will now be progressed. Membership of the group will financial upsides. include academic Input from Academic representation.
Sources - Expressions of LEP Director In abeyance awaiting LEP Interest Review outcomes. 21/11/2019 7 Corporation Tax – Chief Operating Ongoing Ongoing Email dialogue underway with Dialogue with LEP Officer members of the LEP Network. Network In abeyance awaiting Seeking a wider set of contacts LEP Review outcomes. from the LEP Community
Head of Governance attended a Good Practice Roundtable with the other Incorporated LEPs which included this topic in July. Identified Common issues with other incorporated LEPs.
In abeyance awaiting LEP Review outcomes.
Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
4/6/2020 6 Enterprise Zone
Discussion on how to go LEP Executive Ongoing Ongoing Options being considered. beyond what EZ is currently delivering – EZ investment plan being Determine how to take commissioned in Q1 and 2 discussion forward 2021/22
4/6/2020 7 ESIF Sub-Committee Liz Groves / LEP ASAP Closed – No further Letter shared and update Report – Midlands Director Action requested from officials on Engine Investment Fund position of the proposal - Letter received to be shared with the Director and consideration to be given to lobbying for funding to go into the MEIF
24/9/2000 4 Key Performance Indicators
Formal Agreement with (Interim) Director Formal Ongoing Discussion ongoing with the WM/City-REDI and Black of Economic Agreement with BCLEP EIU. Requirements WM/City-REDI being refined for data and Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
Country LEP to be Recovery/LEP and Black analysis. Discussion established Executive Country LEP to be progressing with City REDI established to share resource and improved access to
research capacity
A regional data co- Dialogue with ordination group has been Dialogue with Local Interim Director of established to better co- Local Authorities Ongoing Authorities Economic Recovery ordinate activity including the procurement of a
regional forecast model.
Discussion held with BCLEP
Interim Director of EIU about innovation indicators, who are looking Economic Recovery Investigate Next Relevant Board Investigate Innovation into providing options. Innovation KPI Meeting KPI options options
Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
24/9/20 11 Precision Health Technology Accelerator Complete Grant agreements for the full Proceed to the next £14m have been signed. All the steps of Project With Immediate LGF grant has been drawn implementation. Champion/LEP effect down to the 31/3/21 Executive deadline. The Getting Building
Funding is on track to be drawn down in full by 31/3/22
deadline. Growth Programme
report provides updates.
5/11/20 11 Governance
Inclusion of the Code of Head of ASAP Partially Complete Code shared with LEP Executive Conduct for Pillar Boards Governance / LEP members to share with Pillar and Advisory Groups in Executive Board and Advisory Group the GBSLEP Assurance members. Code to be added to Framework website and next Assurance Framework refresh. Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
21/1/21 5 Finance Scenarios
Establish Finance Chief Operating ASAP Complete Group established – Report on Working Group Officer June Board Agenda
21/1/21 8 Enterprise Zone Programme Update
Chair asked if a Board meeting could be Arrange Board When restrictions Ongoing Situation will be monitored. meeting in allow Potential venues will be arranged in the Paradise area once restrictions Paradise Locality at investigated. the appropriate were lifted. time
Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
Cllr Ward also took the Chief Executive / Ongoing Update was brought to the opportunity at the Head of Board in Feb 2021 request of the Chair to Governance / Board Meetings update Board Directors Birmingham City as appropriate on Commonwealth Council Further updates when Games progress. Chair representative at appropriate. asked for an update to Board Meeting be provided at a future meeting.
21/1/21 10 Place Update and Whole Place Zones In-depth research and Proceed with follow in engagement with a wide range actions following Shanaaz Carroll of private, public and /Place Board selection of pilot area of Immediate In Progress community organisations has occurred and continues to Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
Longbridge and expand. Work also continues to Northfield identify and leverage external funding opportunities to help
maximise impact of interventions. Proceed with further Shanaaz Carroll Immediate In Progress collaborative research /Place Board and scoping in order to
develop a suite of
proposed activities for
the pilot Whole Place Zone.
Proceed with refresh of
the Towns and Local Draft of refreshed framework Centres (TLC) Shanaaz Carroll Immediate In Progress went to Place Board on the 5th Framework (to respond /Place Board May. more specifically to the impacts of Covid and a more clearly defined role for the LEP as ‘place thought leaders’) Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
21/1/21 13 LEP Governance
Changes to be made to Programme As appropriate Changes implemented Changes implemented the Assurance Delivery Board / by Programme Team, Framework and to be Programme Team / Assurance Framework adopted with immediate Head of effect for Programme Governance changes to follow items
Changes to be made to the Assurance Chief Operating As appropriate Changes implemented Framework and to be Officer / Finance / Changes implemented Procurement / adopted with immediate by Finance Team effect for Procurement Head of Governance Assurance Framework items in Finance Control changes to follow Policy
Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
21/1/21 14 AOB Head of At next Board for In Progress On March Board Agenda in Governance which Data is terms of process. Output on Include Risk report in available July Board Agenda. future Board papers
24/2/21 3 Chief Executive’s Report
Consider how to LEP Executive Ongoing Ongoing E-Brochure on Local Growth communicate data to Fund shared with internal and partners. external shareholders. Films produced and broadcast on GBS Channels. Ensuring partner project media coverage includes GBSLEP quotes and
content.
Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
24/2/21 12 Commonwealth Games
Ian Reid (CWG) to CWG / Chief September Board Not yet due To be scheduled provide further update Executive Meeting to GBSLEP Board in 6
months time
Presentation on the creative and cultural CWG / Chief Board Meeting element of the CWG and Executive when available Ongoing To be scheduled the opportunities therein.
24/2/21 13 Access to Finance
Update to be provided Business and Following In progress On Forward Plan for July to Board following Innovation Pillar establishment of establishment of Access Board (Access to Group to Finance Group Finance Group) / LEP Executive Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
25/3/21 3 Offer support to Local Chief Executive / As Required Ongoing Programme and Place Teams Authorities developing Programme Team have provided pipeline details Levelling Up Fund bids with some Local Authorities. No other assistance requested. Topic will be discussed at PDB.
25/3/21 5 Supporting Young Chief Executive / ASAP Ongoing Awaiting initiation after Easter People - Dialogue with Head of Holidays Pillar Board Chairs to be Governance established on the Diversity Topic
25/3/21 5 Further Engagement Head of ASAP Ongoing Initial dialogue with Pillar with the Young Communications / Boards and YCA members Combined Authority Director of initiated by Head of membership to be Economic Strategy Communications established. / Head of Skills
25/3/21 7 Delivery Plan - Chief Operating When Complete Communicate SEP Fund Officer appropriate Approval following clearance per discussion Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
between Chair and Chief Executive.
25/3/21 7 Delivery Plan - Complete Chief Executive / ASAP Complete and sign off the final Head of Strategy version of the Delivery Plan
25/3/21 7 Delivery Plan - Board Board Directors / ASAP Complete Directors to forward Chief Executive comments on Delivery Plan Drafts to the Chief Executive.
25/3/21 8 Low Carbon Growth - Alex Taylor ASAP Ongoing Internal discussion underway Consideration be given on options. to widening the Zero Carbon targets to other Environmental areas., as well as seeing if there Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
could be commonality of Commitment Date with that adopted by other Local Authorities. – Senior Policy Officer to investigate and report back to the Board
25/3/21 8 Low Carbon Growth – Alex Taylor ASAP Ongoing Internal discussion underway to Clear position on targets assess options and
to be set out and measurability of selected communicated back to targets. the Board.
25/3/21 9b Digbeth Public Realm - Programme Team ASAP Complete Verbal update provided at April Follow up on Public Board Meeting. Safety and Lighting Considerations in EZ Projects with BCC Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
25/3/21 10 Growth Programme Programme Team / ASAP Complete Discussions have commenced Update - individual Relevant Heads of with the relevant strategy project items be from the Strategy teams to determine what they discussed at appropriate area would like to see in terms of Pillar Boards.- project and programme Programme Team to discuss with relevant updates relevant to their teams responsible for particular Pillar Board with the Pillar Boards to aim of producing update determine a way reports for the next Pillar Board forward. meetings.
25/3/21 10 Growth Programme Michelle Nutt As available Closed Update – Confirm position in any Cities and Local reallocation process Growth Team
25/3/21 13 Risk Management Head of ASAP Ongoing Head of Governance to arrange Governance discussion Head of Governance to arrange discussion with Chair on best method Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
for Board to provide input.
25/3/21 14 Skills for Jobs: Lifelong Board Directors When Closed E&S Pillar Board Chair has Learning for Opportunity Appropriate made contact with Chamber to and Growth White Paper arrange meeting. Skills team – Board Directors were asking for any Board Members requested to use contact with appropriate links to the with the Chamber of Chamber to make contact with Commerce to ensure them. continued engagement
22/4/21 2 Matters Arising :
The Chair reminded the Board Directors / Directors of the need for Chief Executive Volunteers for a ASAP Complete Volunteers - Cllr Ian Courts for Low Carbon Sector, Cllr Brigid Champion for the Low Carbon Sector and as Jones and Sophie Drake for Members of a Task and Young People Task and Finish Finish Group for the Group Young People. Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
22/4/21 3 Chief Executives Report
Board Directors asked Chief Executive / ASAP Ongoing Ongoing – awaiting resource about the availability of Policy Teams availability
Data on Companies
suffering a material Debt Burden materially affecting the ability to grow (often described as
Zombie Companies). -
LEP Executive to investigate the availability of data and to communicate back to
the Board,
Philip Plowman (Vice
Chancellor BCU) asked if ASAP Ongoing the LEP would support Chief Executive / Head of Skills proving input am initiative it was Head of Skills bringing forward for a Graduate Kickstart
Scheme. A one page summary was to be Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
shared with the Chief Executive - Chief Executive and Head of Skills to review proposal and to determine what support GBSLEP could give.
22/4/21 4 Route to Recovery –
Cllr Brigid Jones asked if the LEP could aid communication of the EU Settlement Scheme, with the deadline approaching on the 30th Growth Hub ASAP Complete June 2021 through the Director
Growth Hub and in
dialogue with the Chamber of Commerce.- Growth Hub Director to review options for communication. Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
22/4/21 5 LEP Review Various
Multiple Actions Summarised in Table below
22/4/21 7 Communications Update
Board Directors to assist Board Directors As appropriate Closed as Ongoing in Social Media platform Action based communications
The Head of Head of When available Communications Complete Communications Communication process committed to share the underway communication plan for the Delivery Plan once this was developed. It was noted that an internal delivery plan for what was expected to be Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
an 8 page document had been set for Mid May.
22/4/21 9 Investment Decision - Board Directors approved the Programme Team ASAP Complete conditional allocation of £4,238,710 (four million two hundred thirty-eight thousand seven hundred and ten pounds) of Enterprise Zone Funding (EZF) capital grant towards the delivery of the Birmingham Smithfield Enabling Works. Programme Team to communicate decision to Project Sponsor.
22/4/21 12 Any Other Business – Written Procedure Item 1
Board Date Agenda Action Agreed Owner(s) Date due for Status Progress update Item completion Number
The Chair asked Board Board Members ASAP Ongoing No responses received to date Directors to communicate any strong views they hold on Physical, Hybrid or wholly Zoom based meetings.
Written Procedure Item 1
22/4/21 – Item 5 LEP Review Actions and Follow Up
Task/Action Responsible Subsequent Action Initiated / Identified Expertise retention in Programme Area Ed Watson The Executive are working with the team to: a) provide them with extended contracts to secure their commitment to the work of the LEP. b) developing a commercial offer based around the skills and expertise of the programme office which can be marketed to local authorities in support of the development and management of their programmes c) in the short term continue to offer informal help to LA’s in bid development, etc. Look to enhance other mechanisms such as EZ when Christian Cadwallader EZIP update paper going to Board (which was faced with a lack of capital investment funding from presented to PDB) which explores new project Central Government Sources pipelines for capital and revenue projects. In June Board papers.
Preparation of “Back Pocket” in relation to Economic Ed Watson Work is ongoing informally across the 3 WMCA LEP’s Geography (enhanced adoption of SED position and to explore what options might look like. Discussions model) also continuing in with the impact districts in relation to overlaps about potential options. NOTE: the LEP review has yet to see or consider a paper on Geography.
Increasing engagement with SMEs = getting message Growth Hub / Satnam Areas identified for follow up : across that they do have a voice Rana-Grindley
Written Procedure Item 1
- LEP sector forums, industry connect, business representation on committees. - surveys (both ours and partners) MGP, CoC QES - BEIS report weekly - Winning Moves surveys - Case studies - Opportunity for businesses through Business Support Review - Working Group and Sub-Board with SME representation - SME champion (GH Champion) on Board Increase engagement/dialogue with NHS in GBSLEP area, Ed Watson For future action including involvement in LEP Boards and Groups Communication of achievements enhanced in view of Satnam Rana-Grindley #TripleHelix Comms campaign starts on 1st June ability to influence current policy decision being reflected which will highlight key achievements, case studies on LEP Review TOR. and testimonials. Delivering Our Future Together - Impact, Insights and Plan 21/22 brochure will be going live on June 1st and shared with stakeholders and partners at national, regional and local level.
Making case for retention of those elements viewed as Henriette Breukelaar / Ongoing activity as part of response to LEP Review vital -Place put forward as example Strategy Teams including Comms activity
Working at a Regional level with the BROs and Ian McLaughlan / Mike A report will be brought back to the Board at its July undertaking greater communication to get to a common Folkard meeting to provide an update on the Access to position on the desires and needs of SMEs. Finance Group’s activities as well as position in relation to SME debt burden and outlook. Options for wider communication under consideration.
Written Procedure Item 1
Determining options for gaining additional feedback from Ian McLaughlan Covered in other items SMEs through Growth Hub
Increased engagement with Business Improvement Place Team / Position identified by Place Team on engagement Districts (as vehicle to talk to SMEs and on our Boards) Programme Team Via our TLC Network which meets quarterly, including BIDs and local authorities, sharing best practice, current issues faced by places and policy updates. The only BID which has only engaged once is Solihull BID. Meeting took place on 25th May 2021. • TLC Funding has and continues to fund projects with Soho Road BID, Jewellery Quarter Development Trust which oversees the JQBID, Southside BID, Colmore and Retail Birmingham BIDs, Kidderminster BID as well as contributing funding to research being undertaken by Colmore on the Future of Business Districts. We have also had discussions with other BIDs during previous TLC funding calls and continue dialogue about alternative funding opportunities. • Advising BCC on defining a new resource, within the Neighbourhoods team, focused on High Streets & BIDs. Supported the recruitment and appointment process. • There are 3 BID representative organisations nationally and we have links with all of them. BIDs tend to be members of 1 or 2. There is a Midlands wide regional ATCM Group chaired currently by Solihull BID. Scenario Planning – use of remaining capital funding to Kate Shaw Update confirming position on June Board Agenda greater effect = confirmation of position to Board, following meeting of the Finance Group. Written Procedure Item 1
Board members to express willingness to support Chair Board Members Responses awaited and CEO to assist in quick turnaround of views Commitment to keep Board informed as LEP Review Ed Watson Ongoing Commitment discussions progress
GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Thursday 15th July
Chief Executive’s Report To raise and discuss headline business Chief Executive Ed Watson Standing item on the agenda, and to note performance against KPIs
Route to Recovery To consider various aspects of the Chief Executive Ed Watson Standing item route to recovery in the GBSLEP area, receive an update from the Recovery Taskforce and agree actions
LEP Review To provide an update on the progress Chief Executive Ed Watson Ad hoc of the LEP Review and potential implications for the LEP activities
Growth Programme Interim Financial and Output Position Programme Delivery Kerry Billington Standing item at End of Quarter 1, for Local Growth Board Fund, DfT reallocated LGF Funds and Getting Building Fund. GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Government updates regarding Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
Enterprise Zone Update To update on the Interim Enterprise Programme Delivery Christian Standing Item Zone Financial and Output Position at Board Cadwallader End of Quarter 1.
Capital investment decisions as required.
Delivery Plan Quarterly To receive the quarterly report in LEP Executive Henriette Breukelaar Standing Item Report respect of the Delivery Plan for Quarter 1
Finance update To review the Period 2 2021/22 LEP Executive Kate Shaw Standing Item financial position and any re-forecast requirements.
GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Access to Finance Update on the Current Position of the LEP Executive Mike Folkard Ad Hoc Item Access to Finance Group. Update on other activities impacting on this area both internally and externally to the LEP. Understanding of the Growth v Debt challenge and the effect this is having on SMEs.
Impact Assessment Update on the Impact Assessment on LEP Executive Ian McLaughlan Ad Hoc Item the Growth Hub for 20/21 as part of the BEIS Annual Review.
Growth Hub Governance Update on the discussions held LEP Executive Ian McLaughlan/ Ad Hoc Item undertaken with the Growth Hub Edward Scutt Working Group and related recommendations.
Risk Reporting Initial Findings from the Risk LEP Executive Kate Shaw / Edward Regular Item Assessment undertaken by the LEP Scutt Executive – Highlighting Key Risks
Governance Updates to the Pillar Board ToRs to LEP Executive Edward Scutt Ad hoc Item incorporate Strategic Objectives GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Communications Update ‘Below the line’ report to update on the LEP Executive Satnam Rana- Standing Item LEP’s communications activities. Grindley
GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Thursday 23rd September
Chief Executive’s Report To raise and discuss headline business Chief Executive Ed Watson Standing item on the agenda, and to note performance against KPIs
LEP Review Final Update on the output of the LEP LEP Executive Ed Watson Ad hoc Review and impacts identified on LEP Activities.
Growth Programme Interim Financial and Output Position Programme Delivery Kerry Billington Standing item at End of Quarter 2, for Local Growth Board Fund, DfT reallocated LGF Funds and Getting Building Fund.
Government updates regarding Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
Enterprise Zone Update To update on the Interim Enterprise Programme Delivery Christian Standing Item Zone Financial and Output Position at Board Cadwallader End of Quarter 2. GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Capital investment decisions as required.
Commonwealth Games Update on Commonwealth Games LEP Executive / CWG Ed Watson / Ian Ad hoc item Update status as requested at February Board Reid (CWG) Meeting
Statutory Accounts To receive, review and approve the LEP Executive Kate Shaw Standing Item 2020/21 Statutory Financial Accounts
Communications Update ‘Above the line’ report to update on LEP Executive Satnam Rana- Standing Item the LEP’s communications activities. Grindley
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Thursday 4th November (if Meeting Required)
GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Thursday 2nd December
Chief Executive’s Report To raise and discuss headline business on Chief Executive Ed Watson Standing item the agenda, and to note performance against KPIs
Growth Programmes Interim Financial and Output Position at Programme Delivery Kerry Billington Standing item End of Quarter 3 and Final position at End Board of Quarter 2, for Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
Government updates regarding Local Growth Fund, DfT reallocated LGF Funds and Getting Building Fund.
Enterprise Zone Update To update on the Interim Enterprise Zone Programme Delivery Christian Cadwallader Standing Item Financial and Output Position at End of Board Quarter 3 and Final position at End of Quarter 2.
Capital investment decisions as required. GBSLEP Board Forward Plan – 2021 Item WP2
Item Purpose Owner Lead officer Standing Supervisory Board item/Regular item/ Ad hoc item
Delivery Plan Quarterly To receive the quarterly report in respect of LEP Executive Henriette Breukelaar Standing Item Report the Delivery Plan for Quarter 2
Finance update To review the Q2 2021/22 financial position LEP Executive Kate Shaw Standing Item and any re-forecast requirements.
Communications Update ‘Below the line’ report to update on the LEP Executive Satnam Rana-Grindley Standing Item LEP’s communications activities.
Item WP3
GREATER BIRMINGHAM AND SOLIHULL LEP BOARD MEETING
10th June 2021
STAKEHOLDER ENAGEMENT & COMMUNICATIONS UPDATE
Recommendations
Board Directors are recommended to: 1. Note media activity highlights from the 1st of April 2021 to 15th May 2021. 2. Note stakeholder engagement activities with GBSLEP public, private and academic sector partners. 3. Note Communications metrics for GBSLEP digital Channels.
Background
4. This report provides a progress update, highlighting key achievements in communications and stakeholder engagement since April’s Board meeting. 5. Since the last Board meeting the GBSLEP Communications Team has been preparing the #TripleHelix communications campaign to coincide with the LEP review period. Please see Appendix A for high level communications plan.
Media Coverage 6. 28 items published with a quote or mention of GBSLEP related investments. Coverage breakdown as per diagram below shows GBSLEP led communications, mentions and contributions to partner press releases made up most of the media coverage. These are illustrated by the orange, yellow and green areas in the diagram to the left.
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7. News from GBSLEP covered included: • Announcement of planning permission for Birmingham Health Innovation Campus, including Precision Health Technologies Accelerator. (£11m from Getting Building Fund and Local Growth Fund).
• Allpack Packaging – moving HQ to Cannock’s Kingswood Lakeside Business Park. (Local Growth fund £2m).
“With a nationally significant business like Allpack choosing this site as their new headquarters, jobs will be created for local people now and in the future. This is critical as we recover from Covid-19.”
Louise Brooke-Smith, GBSLEP non- executive director
• SIP West Midlands – Launch of Skills Report predicting 10,000 job boost for science businesses over the next 10 years. BBC Midlands Today TV report can be accessed below or through this link https://www.youtube.com/watch?v=3ch1Mm0BmiQ
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• 5G Accelerator – several articles on Smart Cities and Construction based training for start-ups. (GBSLEP investment of £1m to WM5G has enabled these programmes to go ahead).
As a business-led organisation, we are here to enable smaller companies to develop and thrive. GBSLEP works in collaboration with local government, businesses and educational leaders to target investments in areas we believe will help grow our regional economy and we are proud to be backing the UK’s first 5G commercial application accelerator.”
Tim Pile, GBSLEP Chair
• Queen’s Speech – FE News picked up on statements put out from Tim Pile - GBSLEP chair, and ITV news Central quoted Tim Pile’s comment. • SuperTech WM – GBSLEP funded Business, Professional, Financial services cluster joins national Fintech National Network – the UK’s first network connecting fintech hubs and supporting nationwide financial innovation. • Local Growth Fund – Allocation of £207.9m fund continued to gain coverage on regional and national trade publications, including a feature on BBC Midlands Today.
• Launch of West Midlands Health Super Cluster (SEF funded £50k towards development).
8. Media outlets publishing GBSLEP news; FinTech Times, Express & Star, BBC Midlands Today, BusinessDesk.com, Smart Cities World, Birmingham Business Live, Computer Weekly, Planning and Building Control Today, Construction News, FE
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News, Birmingham Mail, Solihull Observer, Redditch Standard, Property Funds World, Built Environment Networking, University of Birmingham, Total Telecom, BBC TV and ITV regional news.
GBSLEP Channels
9. Food and Drink Manufacturing Skills Campaign led to one of the featured case studies (Winny’s Meals) being used by Sunday Times as a showcase of businesses relocating to Birmingham.
10. Launch of SIP West Midlands Life Science Skills Report supported by live tweeting from the online event. Social media slates sharing key findings from the report were shared on Twitter and LinkedIn with signposting to the report. Audiences were also signposted to GBSLEP Skills and Apprenticeship Hub. Information has also been embedded within GBSLEP website.
11. Live tweeting from GBSLEP Towns and Local Centres Low Carbon event with further sharing of assets planned on GBSLEP website.
12. All media coverage was supported with posts on LinkedIn and Twitter.
Stakeholder Engagement (Public Affairs)
13. Ongoing MP mapping for the forthcoming #TripleHelix communications campaign.
14. Engagement with key partners on the upcoming West Midlands Low Carbon / Circular Economy Fund.
15. Virtual attendance at West Midlands All Party Parliamentary Group (APPG).
16. Ongoing monitoring of Westminster/ Whitehall activity.
GBSLEP Digital Channels performance in April 2021
17. Performance across Twitter remained steady. In April GBSLEP posts were seen across 77.5k timelines and engagement was comparable to March 2021. The top tweet for April was about the Birmingham Innovation Campus and Precision Health Technologies Accelerator. It appeared 6,785 times on timelines with an engagement rate of 1.5 %.
Number of Followers Impressions Engagement posts Rate April 2021 109 +29 89.9k 0.9% = 6671 March 2021 57 6642 77.5k 0.9%
% difference + 91% +0.4% +16% 0%
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18. Performance on LinkedIn has had a month on month gain in all areas, although engagement dropped slightly. 70 new followers subscribed to the channel and content is appearing on more timelines.
Number of Followers Impressions Engagement posts Rate April 2021 45 +70 20,009 3.53% = 3133 March 2021 44 3063 15,736 3.76%
% difference + 2.3% + 2.28% +27.2% -0.23%
19. Website Analytics as per below. In all there were 8,566 page views.
20. GBSLEP Newsletter was sent to 1229 subscribers (-2) with an open rate of 28.7%.
May/June Planned Activity
21. May and June will predominantly be occupied with #TripleHelix communications campaign. • Publication of Delivering Our Future Together brochure with supported targeted sharing to key stakeholder groups. • Launch of #TripleHelix communications campaign with potential ‘buy in’ from other LEPs/LEP Network. The campaign will run for 4-6 weeks to coincide with the government’s LEP review. • All communications will be seen through the lens of the #TripleHelix campaign. • Satnam Rana-Grindley, Head of Communications will be chairing an Invest West Midlands session on Making the leaders of tomorrow part of today’s recovery plans. Board member for young people, Sophie Drake is part of the panel will be sharing key messages from GBSLEP’s Young People’s Strategy.
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Conclusion
This report provides an update on media coverage and performance of digital channels to 15th May 2021. The GBSLEP communications team continues to identify opportunities to promote the work of the LEP and outline the difference it is making in the region. By the time this report is published, the #TripleHelix campaign will be underway and much of April and May activity has been based on the planning stage for this. The 4–6-week campaign will throw the spotlight on the impact and importance of GBSLEP’s role in bringing together partners to create better places for people to live and work in.
Report by: Satnam Rana-Grindley Head of Communications
Contact: [email protected] Date Created: 18th May 2021
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APPENDIX A – High Level #TripleHelix Communications Plan
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