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Proposal a Leeds City Region Deal

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Proposal a Leeds City Region Deal Proposal A Leeds City Region Deal July 2012 UNCLASSIFIED UNCLASSIFIED Introduction A vision for Leeds City Region The Leeds City Region Local Enterprise Partnership’s long-term vision is to build ‘a world-leading dynamic and sustainable low carbon economy that balances economic growth with a high quality of life for everyone.’ In 2011 we became the first LEP in the country to launch a cohesive economic Plan, outlining our priorities and strategy to help us achieve this vision. We have three key targets: • to accelerate output growth to an average 2.6% per year to 2030 • to create 60,000 new jobs by 2016 • to achieve a substantial reduction in city region carbon emissions The City Deal Proposal we present here is a coherent package to help us achieve these targets. Taken together, our propositions to improve skills, increase exports and deliver much higher levels of investment in transport and other infrastructure – to be followed by further discussions with Government on planning and low carbon – will remove many of the barriers that are currently preventing us from realising our full economic potential. If these proposals are implemented, we will take a big step towards a faster-growing city region and start to generate extra tax revenues for the national purse. For example, a 10% reduction in LCR unemployment will generate an extra £1.3bn for the Exchequer over the next decade as a result of the extra taxes received and lower benefit spending by Government. What we ask from Government is that departments work with local partners to give us the freedoms and flexibilities that will enable us to fulfil our ambitions for Leeds City Region and play our full part in the UK’s economic recovery. Leeds City Region’s strengths Leeds City Region has a diverse and resilient economy1 that possesses both scale and strength in many fields: • we are the largest city region in the country outside London with a population of 3 million • we generate 5% of English economic output with annual GVA of £52 billion • we have the largest number of manufacturing workers anywhere in the UK and the largest number in financial & business services outside the capital • we boast nationally and internationally competitive clusters in: o health & life sciences – particularly biotechnology, advanced surgical instrumentation, pharmaceuticals, regenerative medicine and telehealth 1 Index of Economic Resilience. Report by Ekosgen for Yorkshire Cities, 2011. UNCLASSIFIED 2 UNCLASSIFIED o low carbon industries – we are home to 3 major coal-fired power stations; have substantial renewable and low carbon energy capacity in on-shore wind, biomass, energy-from-waste and micro-generation; a number of leading manufacturers in the low carbon supply chain; and strong environmental consultancy expertise o digital & creative industries – including the Airedale digital cluster, whose combined turnover alone is on a par with that of Cambridge • we also possess nationally and regionally significant hubs of activity in financial & business services (notably finance and legal services) and manufacturing (notably textiles, food & drink, aerospace components, automotive engineering, printing & publishing and construction fabrication) • our quality of life is outstanding, from the internationally renowned landscape of the Yorkshire Dales to world-class cultural assets that include being the home of modern British sculpture • our location at the heart of national railway and motorway networks provides easy access to global markets and means we are ideally placed as a location for the logistics industry • we have innovation assets of the highest quality including: o one of the largest concentrations of higher education institutions in Europe, with 8 institutions producing 36,000 graduates each year o 2 universities in the world’s top 100 o 36% of combined LCR university research is ranked as world-class, and 10% is world-leading in fields such as business & management, medical & healthcare technologies, pharmaceuticals and biotechnology, nano-technology, advanced engineering and advanced textile technology o 15 FE colleges teaching 110,000 students o 11 centres for industrial collaboration, a variety of specialist research institutes and 23 knowledge transfer partnerships What are the challenges we face? Like all areas, we face challenges in achieving our full growth potential. These include: • skill levels in the workforce that have improved, but remain below average • a national and international profile that is not strong enough in comparison with competitor city regions, which has hampered our ability to attract new inward investment in recent years2 • below-average export rates - recent business survey data shows that only 10% of firms in the city region export outside the UK.3 Further, in those areas where the city region is understood to have its greatest niche strengths (such as services, healthcare and medical devices), the region lags UK competitors in its share of UK trade4 • business start-up, survival and growth rates that lag behind the national average 2 A recent report by fDi Intelligence, part of the Financial Times, found that West Yorkshire ranked 15th in the country for inward investment, behind Birmingham, Manchester, Tees Valley and Newcastle. 3 Leeds City Region Business Survey. Yorkshire Cities, 2011. 4 Leeds City Region Growth Industries. LCR Economic Drivers and Innovation Panel, 2011. UNCLASSIFIED 3 UNCLASSIFIED • smaller-than-average private sectors in some parts of the city region • low levels of public sector investment in some sectors, which have left the city region’s infrastructure lagging behind what is needed to support a world- leading economy5 As a result, although our productivity levels match those of most core city regions, we are not improving our overall economic performance relative to national or international competitors. Since the start of the recession the city region has lost jobs twice as fast as the national average. The Leeds City Region Proposal This City Deal offers an unprecedented opportunity to work with Government to tackle these key challenges, and unlock the full potential for low carbon growth and job creation in the Leeds City Region. As part of our ambitious proposal, we will: • transform the city region’s job market with progress on two fronts: a long-term ambition to move to a ‘NEET-free’ Leeds City Region and to shape the skills investments of Government, employers and individuals to align with the real growth sectors in our economy • create a £1bn ‘West Yorkshire-Plus’ transport fund to unite the Leeds and Manchester City Regions into a single functional £100bn economy • pool up to £200m from partners within the city region – if it is matched by central government – in a Leeds City Region Investment Fund for the benefit of the entire area using a common appraisal framework • eliminate the city region’s balance of payments deficit with the rest of the world through a major drive to increase our exports and promote inward investment • deliver a much more business-friendly planning system • aim to become the exemplar UK low carbon city region in non-domestic retrofit, low carbon business and sustainable, low carbon design In return, we ask government departments to give us the freedoms and flexibilities we need to drive forward this agenda, based on our own local priorities. 5 For example, public sector investment in housing in Yorkshire & Humber has consistently seen the lowest allocation per capita of any region, while investment in transport has remained at much lower levels than in London for many years. UNCLASSIFIED 4 UNCLASSIFIED The Leeds City Region propositions Main proposals 1. Skills and worklessness: Skills pathways for a vibrant economy 2. Transport: A transformed transport system across the north 3. Investment: Transforming our infrastructure – a Leeds City Region Investment Fund 4. Trade and inward investment: Closing the Leeds City Region balance of payments gap Supplementary proposals 5. Planning: Business Friendly Planning to Promote Growth and Development 6. The low carbon economy: Delivering the UK’s leading low carbon city region Appendix 7. Leadership in Leeds City Region UNCLASSIFIED 5 UNCLASSIFIED 1. Skills Pathways for a Vibrant Economy Our ambition is to increase significantly the opportunities available to disengaged young people, as well as those searching for their first chance of employment, and to actively align the longer-term skills investment of Government, businesses and individuals much more closely to the growth opportunities in our economy. Firstly, there are too many young people in Leeds City Region who are not connecting with the labour market or who have the wrong skills for today’s jobs. This is a waste of their talents, a blight on our communities and a drag on the city region’s economic growth. Our long term ambition is to have a ‘NEET-free’ city region by transforming the experience of young people entering the job market. Our first step is to offer a Guarantee to the Young supported by a range of integrated pathways including education, training, volunteering, work experience and apprenticeships, leading to jobs and higher level qualifications. We believe it will be vital in a continuing period of austerity to offer young people the hope of a bright future, rather than the current negative outlook linked by the media to social unrest. Secondly, we must engage business much more directly with longer term skills investment to ensure that the £500m of mainstream skills funding is driving growth in our key sectors and attracting more private investment in higher level skills to add value to the economy. Our LEP is committed to taking a leadership role on skills, which is one of its highest priorities for driving productive economic growth. Along with other LEPs in our region, we have commissioned a major research project to identify in detail the current/future skill needs of employers in our key sectors. We intend to use the results to target future skills investment priorities, working closely with our FE/HE partners in the Leeds City Region Skills Network.
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