North West of England Objective 2 Programme Complement ______
NORTH WEST OF ENGLAND
OBJECTIVE 2 PROGRAMME
2000-2006
PROGRAMME COMPLEMENT North West of England Objective 2 Programme Complement ______
TABLE OF CONTENTS
Page
1. Introduction 2
2. Strategic Priorities - Priority 1 : Business and Ideas 7 - Priority 2 : People and Communities 45 - Priority 3 : Strategic Regional Investment 76
3. Cross-Cutting Themes - Equal Opportunities 105 - Information Society 114 - Sustainable Development 123
4. Technical Assistance Strategy 132
5. Communication Plan 138
6. Co-Financing Strategy 144
7. Performance Reserve 147
8. Computerised Exchange of Data 148
Annex A - Priority Two Targeted Wards 149
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1. INTRODUCTION
The aims, objectives and strategy of the North West Objective 2 Programme are outlined in the Single Programming Document. The SPD contains a detailed review of current conditions in the Programme Area, a strategic framework which identifies three Priorities and three cross-cutting themes, and outline management and implementation arrangements. In line with the Structural Fund Regulations, the SPD acts as the legally binding agreement between the UK Government and the Commission.
The strategy contained in the North West Objective 2 SPD aims to develop a competitive and sustainable economy which offers employment and income opportunities for people of all ages, abilities and gender. This strategic aim reflects the need to boost the competitiveness of the Objective 2 area in order to narrow the prosperity gap with the UK as a whole, whilst recognising the need to reduce inequalities with the region and secure growth which is long-lasting.
Securing this aim requires intervention in a range of areas and the SPD identifies three objectives, the combined achievement of which will secure the success of the Objective 2 programme. The three objectives are:
· To contribute to the creation of a 21st century economy through the development of new and high growth employment sectors as well as supporting the competitiveness of existing businesses, where the key features are enterprise and knowledge
· To empower and enable people of all ages, races and gender to access income and employment opportunities that reflect their aspirations and circumstances
· To address the environmental legacy of the past through supporting opportunity led investment that creates new income and employment opportunities while restoring or maintaining the environment and heritage assets of the region
Although the North West Objective 2 Programme has been allocated substantial sums, achieving these objectives requires that funds are deployed in discrete areas which maximise economic, social and environmental impacts. A strategy based upon three Priorities of Business and Ideas, People and Communities, and Strategic Regional Investment have been devised to address the range of competitiveness and regeneration issues identified in the review of current conditions in the North West.
The first Priority, Business and Ideas, seeks to improve the competitiveness of the existing business, through exploiting existing sectoral strengths as well as maximising the opportunities afforded by developments such as the Information Society as well as the academic and research base in the Region. Priority 2, People and Communities, seeks to target resources on the most disadvantaged communities in the North West, in order to address the multifaceted problems of economic and social exclusion. The third Priority, Strategic Regional Investment, aims to generate substantial new employment opportunities through the development of key business, heritage and cultural locations.
Within the three Priorities, the Objective 2 Strategy also identifies three cross-cutting themes of Equal Opportunities, The Information Society and Sustainable Development. The integration of these themes into project design and implementation will help to ensure that the objectives of a reduction in gender
2 Introduction ______North West of England Objective 2 Programme Complement ______
disparities, maximising the potential of ICT, and achieving growth which is economically, socially and environmentally durable can be achieved.
3 Introduction ______North West of England Objective 2 Programme Complement ______The North West Objective 2 strategic framework can be summarised as:
Programme Aim
A competitive and Sustainable Economy
Strategic Objective 1 Strategic Objective 2 Strategic Objective 3
21st Century Economy Access to Opportunity environmental legacy
Priority 1 Objective Priority 2 Objective Priority 3 Objective
Enterprise and business Employment and Employment and performance opportunity for excluded investment from Information communities Society
Business and Ideas People and Strategic Regional Equal Communities Opportunities · Enterpreneurial · Enterprise and · Strategic business starts employment opportunities · SME · Access to · Natural, heritage competitiveness employment and cultural assets · Access to finance · Inclusive · Connecting with Sustainable · Knowledge Information Society communities in Development economy · Connecting need · Investment in communities premises · Sustainable Development
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This document, the Programme Complement, elaborates more fully how the strategy for the Objective 2 area outlined in the SPD will be operationalised. In particular, the Complement provides greater detail on the implementation of the individual elements, or measures, within each of the Priorities incorporating financial allocations, indicative activities, and intended final beneficiaries.
In order that the maximum level of understanding is achieved, some of the analysis and information from the SPD is restated in the Complement. This largely reflects the degree of preparatory work undertaken in devising the SPD, and the level of detail presented in the Plan itself. In practice, some of the detailed information normally reserved for the Programme Complement was, in the North West, incorporated in the SPD.
The Complement is not, however, a substitute for the SPD and organisations are encouraged to read and assimilate the Complement in parallel with the SPD. Whilst every effort has been made to ensure consistency between the SPD and the Complement, in the event of any discrepancies, the content of the SPD takes precedence. In contrast to the SPD, the Complement is a working document for the Monitoring Committee not subject to formal negotiations with the Commission.
Whilst providing significantly more operational information than the SPD, the Complement does not, however, include the full range of guidance, information and advice required by applicants in developing their proposal. Separate papers on action plans, project selection criteria, sources of co-financing and eligibility of expenditure (as well as a number of other areas) which extend the information provided in the Complement will be produced by the European Programmes Secretariat.
The principle function of the Complement is to provide greater information for each of the three spending Priorities of Business and Ideas, People and Communities, and Strategic Regional Investment. In the SPD, the emphasis was upon specifying broad Priority-level information with only partial detail provided on the constituent measures within each Priority. In the Programme Complement, the depth of information provided for each of the measures, (which ultimately sets the parameters for the projects which can be supported) aims to significantly increase the level of awareness and understanding amongst potential sponsors and other interested parties.
This information incorporates:
· EU financial allocations and anticipated co-financing from the UK public and private sectors;
· the method and arrangements for the targeting of resources, where applicable
· a set of indicative activities which are eligible for support and those activities not considered appropriate for support
· the principles of the system for the appraisal and selection of projects including, outline selection criteria
· outline arrangements for the management and administration of funds
· quantified targets for core output, result and impact indicators
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· a list of intended final beneficiaries
The text in the Complement also elaborates on the rationale and assumptions adopted in the division of EU funds between measures and the derivation of the quantified output, result and impact targets. The rationales and assumptions were tested with the Partnership during the consultation phase on the first draft of the Complement.
The Complement also provides significant information on the operationalisation of the three cross-cutting themes of Equal Opportunities, Information Society, and Sustainable Development. This information includes quantified targets and gateway criteria which all projects will be required to address.
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2. STRATEGIC PRIORITIES
2.1 PRIORITY ONE : BUSINESS AND IDEAS
Introduction
The critical importance of the SME sector in any regional economy cannot be understated. Not only does it provide the bulk of private sector employment, it also provides the capacity and flexibility to allow a region to respond quickly and positively to change. In the post-industrial knowledge economy, SMEs are increasingly vital as sources of creativity, innovation and wealth generation. Priority 1 will harness the latent creativity and innovation in the Objective 2 region to build a modern and dynamic digital economy for the 21st Century, not only to create sustainable competitive advantage, but also to provide sustainable employment opportunities for socially excluded people.
Priority 1 will accelerate the region’s transition from the old to the new economy. It will help protect and sustain the region’s established industries, while providing the right conditions for growth in the so-called ‘sunrise’ sectors. It will develop a business environment that attracts and retains more risk-taking entrepreneurs, especially in growth sectors, and encourages them to survive and flourish in the region. The pervading impact of information society technologies and e-commerce will be exploited, both in nurturing the best of existing businesses and in developing new knowledge intensive enterprises.
The Priority will stimulate the market for business support services by encouraging suppliers in the public and private sector to focus on high quality interventions targeted at growth-aspirational SMEs, including those in the social economy. The five Measures within the Priority are designed provide an integrated menu of actions to tackle the needs of growing businesses at every stage of their development, and to accelerate the diffusion of best practice across the region. The SMEs supported will make a positive impact on competitiveness, employment growth and wealth creation while enhancing the region’s capacity to create and sustain knowledge.
The proposals reflect the key policies operating at EU, UK and regional levels. The proposals reflect the key policies operating at EU, UK and regional levels. They build upon the objectives set at the Lisbon European Council for “preparing the transition to a knowledge-based economy and society” with better policies for innovation, R&D and the information society.They align well with the central concerns and themes of the DTI White Paper, 'Our Competitive Future: Building the Knowledge Driven Economy', and will fully complement the operations of the new Small Business Service. The proposals also support the ambition outlined in the NWDA's Regional Strategy for the North West to become an international centre for the development of high growth potential sectors by helping to create an environment more conducive to entrepreneurship, creativity, innovation and e-commerce.
Review of Baseline and Trends
The Objective 2 Programme area (i.e. fully eligible and transitional) comprises 91,9251 businesses, of which 86.4% employ less than 10 persons. The highest concentrations of smaller businesses are in the rural areas while larger employers – of which the Objective 2 area is over-represented – are concentrated in the urban areas. On many key indicators of competitive advantage, however, the Objective 2
1 IBDR, 1999
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region lags well behind the UK: the overall number of businesses in the region is falling at a much faster rate, a lower proportion businesses are in smaller sizebands, and there are significantly fewer businesses per head of population.
The region’s economy is further disadvantaged by its weak industrial structure whereby declining sectors are heavily over-represented and new and fast-growing industries and services are underdeveloped. Manufacturing industry remains much more important to the Objective 2 area than to the UK, and although many of the region’s manufacturing businesses remain competitive, the general trend is one of rapid decline. Between 1994 and 1998 the number of manufacturing businesses fell by 9% in the Objective 2 area compared to 3.9% in the UK. In the most vulnerable manufacturing sectors, notably process manufacturing, the Objective 2 area is significantly over-represented. The over-dependence on large and manufacturing employers lays the region open to adverse shifts in the national and global economies and increases the exposure to large scale closures or downsizing.
Service industries and new knowledge-based industries provide the greatest potential for growth. However, while service sector employment growth in the Objective 2 region has kept pace with the national trend, the proportion of businesses and employees in service sector industries lags significantly behind other UK regions. The evidence also shows the Objective 2 area to have a low and rapidly declining share of employment in high technology sectors.
The evidence presented clearly identifies a significant enterprise deficit in the region with the region’s SME base clearly in need of stimulation and entrepreneurial development. The rates of formation and survival of new businesses are significantly poorer in the North West than nationally and the region is ranked bottom in the rate of creation of new manufacturing registrations, a fact re-enforced by the low level of self employment in the region, at just 92% of the UK average.
Review of Past Experience
In July 1999 the European Commission’s published a Thematic Evaluation of Structural Funds Impacts on SMEs2 and made a number of recommendations concerning the future use of the Structural Funds in support of SMEs. These included:
· defining more clearly the targets of Structural Funds SME interventions at both strategic and operational levels;
· shifting the emphasis of Structural Funds interventions from SME grant aid and physical infrastructure schemes – which in the last programmes accounted for a large proportion of expenditure – to other types of ‘softer’ and more indirect interventions such as business support services, investment finance schemes, the promotion of innovation and networking, and SME training measures.
· promoting improved packaging and integration of business advisory services with more emphasis on initial diagnosis of SME needs and the development of customised support packages;
· integrating innovation and technology measures, particularly those concerned with technology transfer and the knowledge base, within holistic packages to improve SME competitiveness and growth;
2 European Commission (July 1999) Thematic Evaluation of Structural Funds Impacts on SMEs.
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· placing more emphasis on the development of SME clusters and other initiatives to promote ‘horizontal’ and ‘vertical’ networks as a means of developing the small business sector;
· promoting more effectively the role of women as entrepreneurs and as SME owner-managers;
· improving project appraisal and selection methods so that the additionality of Structural Funds measures in favour of SMEs is maximised and deadweight and displacement are minimised.
Within the 1994-99 North West Objective 2 and 5b programmes significant allocations were made towards the development of the region’s SME base and there was a strong emphasis on sectoral interests within the structure of the documents. All Programmes in the 1994-99 period carried a tourism measure, though in GMLC this was broadened to include cultural industries. Both Objective 2 Programmes carried measures to support “Knowledge Based Industries and Advanced Technologies”. There was a heavy emphasis on physical development within business support measures, particularly in GMLC, and a generally poor take-up on ESF. The evaluations of these Programmes indicated a moderately satisfactory performance within the business support measures, notwithstanding the incompleteness of monitoring data and the variable experiences of partners, with a notable improvement in the 1997-99 performance in actions targeted at existing SMEs. This Priority aims to build on the positive experiences gained from these programmes and to address some of the key weaknesses that have been identified.
During the consultation process for the new Programme there was extensive discussion by partners concerning their experiences of previous programmes, with the result that the following key developments have been taken forward into the content of Priority 1:
· a move away from sector-specific priorities in favour of a managed process of sector prioritisation and review; · the mainstreaming of innovation and technology throughout all Measures; · integrated Measures that offer flexible and holistic packages of support; · a stronger emphasis on ‘softer’ business development activities.
A further development is the existence in the region of a significant partnership knowledge base which has built up during the previous Structural Fund Programmes, not only through Objectives 2 and 5b, but also through Objective 3, and Community Initiatives such as URBAN, SMEs, EMPLOYMENT and ADAPT.
Rationale for Intervention
In the knowledge economy a vibrant SME base is a basic pre-requisite for sustainable economic growth. The best performing regions of Europe are characterised by a high proportion of businesses in emerging and growth sectors, a highly skilled and flexible workforce, good links with the research base, excellence in the application of ICTs, strong investment in R&D, and a buoyant market for externally-sourced business development services. While the Objective 2 region possesses many thriving world class businesses, the region as a whole lags behind, and there is a pressing need to inject new dynamism into the industrial base to accelerate the rate of transition to the new economy.
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The SWOT in Chapter 7 of the SPD identified the following key characteristics of the Objective 2 region:
Strengths Weaknesses
· a major manufacturing base; · a significant enterprise deficit; · a significant technology base; · an over-dependence on declining sectors; · a well developed tourism industry; · an under-representation in service industries; · the Lake District; · weak uptake by business of ICTs and their applications. · a strong urban-based cultural industries sector. · Opportunities
· e-commerce and ICT; · growth manufacturing sectors; · world class manufacturing companies; · an increase in tourism and leisure expenditure; · growth in learning.
The approach adopted by Priority 1 will be to deploy resources to address fundamental weaknesses in the region’s industrial base while exploiting its significant but as yet under-developed strengths and opportunities.
As a result of detailed partner consultation it was also agreed that Priority 1 resources should ensure that innovation activities would be supported across all of the measures within the priority with an emphasis on creating greater links and synergy between mainstream business support and access to innovation services, including R&D activities and incubation facilities linked to HEIs and related business networks.
The region’s significant technology base includes the intellectual capital in the Higher Education Institutions, and there are a number of world class departments in areas such as engineering. The potential of institutions to spin out new and high growth SMEs in a manner similar to American universities is hampered by a number of factors including difficulties in accessing risk and venture capital, and a deficit with regard to business and entrepreurial skills as distinct from technical skills. This measure will provide support to support University spin-outs as an important component of increasing the number and quality of new starts in the region.
Objective 3
Objective 3 will be a key additional element in the effectiveness of Objective 2 and in particular the aims of this Priority. Objective 3 will be used to complement and support the overall objectives of the programme and will address specific skills training and workforce development needs based upon identified regional requirements.
Priority 1 has been developed in close conjunction with the North West Regional Development Plan for Objective 3 in order that ESF-funded human resource development will continue to be an integral element of business development packages. Management processes for Objectives 2 and 3, including the application
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and selection process, will be brought into line to ensure maximum synergy between the two programmes.
Targeting
The Objective 2 Programme will be delivered with reference to the following guiding principles, as outlined in Chapter 8 of the SPD:
· delivering best value; · ensuring sustainable results; · moving towards excellence; · developing a learning culture.
In order to simultaneously meet these principles and address the problems and opportunities of the region’s SME base, Priority 1 will employ a targeting approach, its aims being to:
· ‘raise the game’ in terms of overall business performance; · intervene only in areas of support where market failure is clearly demonstrable; · support high quality interventions that contribute significantly to the protection and creation of sustainable jobs and income in the region; · minimise deadweight and displacement while maximising multiplier effects; · mainstream equal opportunities and ICT applications as core activities within comprehensive and sustainable business development packages.
Evidence provided in earlier Chapters highlights significant differences in the role and importance of different industrial sectors to the development of the region, and during the consultations on Priority 1 a particular discussion point among partners was the question of the degree of emphasis that should be placed on sectoral priorities in the project selection process. It was agreed that while it will be essential to focus on growing and emerging sectors where the region has the clearest competitive advantage, it will also be important to protect growth SMEs in the region’s established sectors and to encourage growth SMEs in other sectors. This issue has been addressed through the development of a three pronged approach to prioritisation:
1. SMEs in Regional Priority Sectors
Priority 1 will adopt the same priority sectoral groups as are identified in the current version of the NWDA Regional Strategy3. Guidance will be sought from the NWDA regularly as the sector classification is reviewed and rolled forward on the basis of a structured research programme.
2. SMEs in Growth and Emerging Sectors
SMEs in sectors with good long term growth prospects have the greatest potential to strengthen the regional economy. The quadrant analysis in Chapter 2 provides a potential model for the identification and prioritisation of growth and emerging sectors not prioritised in the Regional Strategy (although account has to be taken of the employment/value added potential to ensure suitability for Structural Fund investment).
3 In the 1999 NWDA Strategy 7 priority growth sectors were identified: environmental technologies; life science industries; medical equipment and technology; financial and professional services; tourism; computer software and services / internet- based services; creative industries, media, advertising, and public relations. All of these sectors are of importance in the Objective 2 Programme area.
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3. Growth-oriented SMEs in Other Eligible Sectors
Growth-oriented businesses are present in any sector, in any location, and at all stages of the business lifecycle. Priority 1 will seek to accommodate such businesses eligible for Structural Fund support within its programme of support, dependent on clear evidence of growth prospects. It is expected that this group of SMEs will be particularly important in the more rural and remoter parts of the Programme area, where sectors and clusters may not be well represented.
As the Objective 2 area covers some 60% of the NWDA area, and an even higher proportion of the employment base, it is expected that the majority of sectors targeted by the NWDA will be relevant to the Programme. The initial designation of sectors, and any up-dating or review of the list, will include an assessment of the proportion of sectoral employment within the Objective 2 area. This will help to ensure that targeted sectors are strongly represented within the Objective 2 area. The designation of sectors and clusters will take account of their employment/value added potential to ensure that major Structural Fund support is justified.
The targeting of support in urban and rural areas will take account of the NWDA sub- regional analysis and prioritisation, and the strategies developed by the six Small Business Services operating within the Progamme Area. This will ensure that account is taken of the business structure throughout the Programme area, with particular regard to the issues identified in Chapter 2 facing the rural economy. Consideration will also be given to fit with regional frameworks such as the International Trade Strategy and Innovation Strategy.
With regard to rural and peripheral areas, account will be taken of the importance of tourism and the significant manufacturing base. Other important factors also include the degree of “hidden” unemployment and partial employment, and lack of accessible employment opportunities. Concerted efforts to support new investment in rural locations, particularly with regard to the provison of appropriate property for SMEs to expand and new businesses to start trading.
Targeting will also to reflect the diversity of the region and the businesses within it. As already noted, Priority 1 will acknowledge spatial variations such as the differences in business structure and type between rural and urban areas, and also between the fully eligible and transitional areas. Additionally accommodation will need to be made for social enterprise and not-for-profit businesses located in areas of severe disadvantage.
In practical terms, this means concentrating support on businesses that have the inclination, capacity and commitment to benefit from public intervention, while scaling down support to static SMEs trading in local and sub-regional markets. This will apply to start-ups as well as established SMEs.
Effective management and implementation of the Priority is critical to successful targeting. In all cases a thorough appraisal of support will be carried out with particular regard to market failure, deadweight, displacement and multiplier effects. This will include an assessment of the type of business support being delivered to ensure that the focus is on high impact services. Applicants will require much more detailed guidance than has been previously available to identify the impact of project proposals and to articulate the benefits to the region. The Annual Review process will be used to monitor and evaluate targeting and project selection systems across the Priority, informed by the availability of monitoring data at project and measure level.
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Priority Objectives and Structure
The previous chapter outlined that the aim of the 2000-2006 North West Objective 2 Programme would be:
To develop a competitive and sustainable economy which offers employment and income opportunities for people of all ages, abilities and gender.
Three strategic objectives were identified that would deliver this programme. Whilst all three strategic objectives will be supported through investment made under this Priority the key strategic objective highlighted in Chapter 8 that Priority 1 will address will be:
To contribute to the transformation of the North West economy through the development of new and high growth employment sectors as well as supporting the competitiveness of existing businesses, where the key features are enterprise and knowledge.
This transformation process can only be achieved by a concerted effort to rapidly accelerate the rate of diversification and growth of the regional economy. This must be achieved by concentrating on the region’s business strengths and opportunities and in particular by exploiting its knowledge base, whilst the same time taking positive action to ameliorate weaknesses in the region’s industrial base.
Against this backdrop, the agreed Priority 1 objective is:
To create and protect jobs and income by investing in new entrepreneurial businesses, innovation and e-commerce, and by improving the business performance of existing SMEs.
To deliver this Priority objective the following five Measures are proposed:
Measure 1.1. Creation and Establishment of Entrepreneurial Business Starts (ERDF)
The purpose of this Measure is stimulate new entrepreneurial business start-ups and increase their survival rates.
Measure 1.2. Increasing the Competitiveness of Established SMEs (ERDF)
This Measure aims to support the development of existing small and medium-sized businesses, particularly those with a growth orientation.
Measure 1.3. Access to Investment Finance for Growth SMEs (ERDF)
This Measure seeks to stimulate a higher rate of business formation, survival and growth in the region by providing access to investment finance for entrepreneurial start-ups and SMEs.
Measure 1.4. Developing the Regional Knowledge Economy: Supporting Business Innovation and Networking (ERDF)
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This Measure aims to enhance the region’s competitive position by supporting innovation activities, especially those linked to advanced R&D and knowledge transfer initiatives, through the development of innovative business networks. Actions will support new innovation partnerships and the development of both ‘horizontal’ networks and the facilitation and linking together of business networks to create innovations, share knowledge and pool resources.
Measure 1.5. Investment in Premises for New and Expanding SMEs (ERDF)
This Measure will support the growth and expansion of SMEs through the provision of specialised accommodation such as managed workspace, business incubators and technology parks.
These Measures have been carefully designed in consultation with partners to dovetail with the other actions proposed by this Programme. Agencies will be encouraged to operate Priority 1 business development projects in close alignment with projects supported under Priorities 2 and 3, and in particular to complement actions to tackle social exclusion in disadvantaged areas. Priority 1 has taken full cognisance of and fits well with the Objective 3 Programme for the North West, and Measures have been modelled to match and add value to mainstream UK Government policy initiatives.
Investing Priority One Resources within the Objective 2 Transitional Area
The aim of Priority 1 in the transitional area is to build on previous Structural Funds Programmes by continuing to accelerate the process of economic transformation and in particular to reinforce the long term sustainability of the SME base. The objectives and operating principles of Priority 1 outlined above were drawn up following consultation across the whole region and will apply uniformly across both the fully eligible and the transitional areas.
Priority 1 comprises actions capable of making a significant long term economic impact on the transitional area, and this reasoning accounts for the relatively high proportion of transitional funding designated to this Priority. As shown below, the financial allocations for each Measure will be varied to reflect the distinct economic conditions in the fully eligible and transitional areas, with a slightly greater emphasis on Measure 1.5 for the transitional area.
Careful consideration has been given to developing an approach for the Transition Areas which takes account of a number of factors, including:
· The nature of the Transition Areas in terms of business performance and structure, as well as the geography of the Transition Areas (which comprise 8 distinct geographical areas);
· The limited nature of Transitional funding, including the annual expenditure profile;
· The need to ensure sustainability of actions after Strucural Fund support ends.
The business and economic analysis presented in Chapter 2 indicated that a number of Transitional Areas performed better than the average for the Fully Eligible Areas. In most cases, however the difference was not substantial, and there is considerable overlap between the “worst” of the Transition Areas, and the “best” of the Fully
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Eligible areas. This indicates that a crude distinction between Transition and Fully Eligible Areas would be inappropriate. The economic analysis suggests that the majority of Transition Areas have similar characteristics and trends as adjoining Fully Eligible Areas, than with more distant Transition Areas.
The research on business needs and constraints, also indicates a commonality across the Programme Area, with issues affecting businesses determined by their size, sector and location (urban or rural), rather than their designation as a Transition or Fully Eligible Area. This is not surprising since the criteria used to determine status took no account of performance by business sector or performance by SMEs. There is no evidence to suggest that on average, SMEs in Transition Areas have lower failure rates, or higher growth rates than those in Fully Eligible Areas.
As a consequence of the linkages between Transition and Fully Eligible Areas, and the similarities in terms of the SME performance and constraints to growth, all five of the Measures developed to implement Priority 1 will be available in the Transition Areas. This will allow a consistency of coverage in terms of revenue support, and also allow capital projects which can contribute to a sustainable business support programme and also leave an on-going legacy after support has ended to be supported.
As with the Fully Eligible Areas, the indicative allocations by measure for Transition Areas indicates that the majority of support will be made available for revenue related projects. In view of the importance of increasing the competitiveness of the business base to sustainable economic growth, this Priority has been allocated 70% of EU support for the Transition Areas.
Although a large proportion of the Transition funds has been allocated to Priority 1, in view of the expenditure profile and the need to ensure that a reasonable level of resources is available to ensure that each measure is viable in terms of the activity it can support, Priority 1 Transition measures will operate from 2000-2004 only. This will ensure that each measure budget will have at least 0.5 meuro of EU support available in each year. This is a more robust approach than arbitrarily deciding to de- activate particular measures, when the balance of activity to be funded across the Priority will vary from Transition Area to Transition Area. The scoring and appraisal system will give consideration to prioritising those activities which take account of the need to ensure sustainability and leave a legacy.
Financial Allocations and Priority Targets
The following tables indicate the financial allocation at the Priority level, including the allocation to EU Fund, the Priority level UK Public and the private sector contributions for both the Fully Eligible Objective 2 Area and the Transitional Objective 2 Area. The allocations presented are for the lifetime of the Programme.
Priority 1: Business and Ideas – Summary Financial Table (Meuros) Objective 2 Programme Area – Fully Eligible Area Total Costs EU (ERDF) UK Public Private Total 518.464 232.183 232.183 54.099
Priority 1: Business and Ideas – Summary Financial Table (Meuros) Objective 2 Programme Area – Transitional Area Total Costs EU (ERDF) UK Public Private Total 254.368 111.077 111.078 32.213
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The allocation of 35.9% of resources to Priority 1 reflected the importance in further strengthening and developing the SME base. This incorporates the need to urgently improve the existing SME base given the continuing importance of manufacturing industry (which is under considerable competitive pressure), and the need to develop new jobs in higher growth and higher paid sectors.
Careful consideration has been given to the financial contributions from the public and private sector. Priority 1 is primarily concerned with the provision of high quality business support for SMEs, to increase competitiveness (and thus employment). In view of the importance of modernising and strengthening the business base, the UK Public sector will match the EU contribution in Priority 1 with additional contributions from the private sector. The private sector contribution recognises the role likely to be played by the private sector with regard to project activity in Measures 1.4 and 1.5, where EU support is likely to be limited to 15% (where projects are deemed to be productive investments).
Taking account of the scale of opportunities and degree of market failure in the eligible areas, the Partnership agreed the following split of Priority 1 ERDF resources between the five measures:
Measure 1.1 Business Starts: 15% Measure 1.4 Knowledge Economy: 22.5% Measure 1.2 Competitive SMEs: 27.5% Measure 1.5 Investment in Premises: 25% Measure 1.3 Investment Finance: 10%
The ERDF allocation in each measure will be matched by the UK public sector. It is envisaged that the bulk of private sector co-financing will be secured for financial engineering projects in Measure 1.3 and sites and premises schemes in Measure 1.5.
Priority 1 Business and Ideas: Eligible Areas (million euros) ERDF UK Total UK Total Cost Public Public Privat e 1.1 Business Starts 34.827 34.827 69.654 2.000 71.654 1.2 Competitive SMEs 63.850 63.850 127.700 3.000 130.700 1.3 Investment Finance 23.218 23.218 46.436 23.000 64.436 1.4 Knowledge Economy 52.241 52.241 104.482 10.000 114.482 1.5 Premises Investment 58.047 58.047 116.094 16.098 132.192 P1 TOTAL 232.183 232.183 464.366 54.098 513.464
The annual split of ERDF by measure in Priority 1 eligible areas is as follows:
Priority 1 Business and Ideas: ERDF Allocation by Year in Fully Eligible Areas (million euros) 2000 2001 2002 2003 2004 2005 2006
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1.1 Business Starts 6.465 5.935 4.358 4.497 4.319 4.626 4.627 1.2 Competitive SMEs 11.853 10.881 7.989 8.246 7.918 8.479 8.484 1.3 Finance 4.310 3.957 2.905 2.998 2.879 3.084 3.085 1.4 Knowledge 9.697 8.902 6.537 6.746 6.479 6.939 6.941 1.5 Premises 10.774 9.892 7.264 7.496 7.199 7.710 7.712 Total 43.099 39.567 29.053 29.983 28.794 30.838 30.849
The measure profile of ERDF resources in the transition areas differs to the eligible areas, taking into account the differing scale of opportunities. The Partnership agreed the following split of Priority 1 resources between each of the five measures:
Measure 1.1 Business Starts: 15% Measure 1.4 Knowledge Economy: 15% Measure 1.2 Competitive SMEs: 30% Measure 1.5 Investment in Premises: 25% Measure 1.3 Investment Finance: 15%
The ERDF allocation in each measure will be matched by the UK public sector. It is envisaged that the bulk of private sector co-financing will be secured for financial engineering projects in Measure 1.3 and sites and premises schemes in Measure 1.5.
Priority 1 Business and Ideas Financial Profile: Transition Areas (million euros) ERDF UK Total UK Total Public Public Private Cost 1.1 Business Starts 16.662 16.662 33.324 1.000 34.324 1.2 Competitive SMEs 33.323 33.323 66.646 2.000 68.646 1.3 Investment Finance 16.662 16.662 33.324 16.212 49.536 1.4 Knowledge Economy 16.661 16.661 33.322 3.000 36.322 1.5 Premises Investment 27.769 27.769 55.538 10.000 65.538 P1 TOTAL 111.077 111.077 222.154 32.213 254.366
Given the comparatively smaller amounts available in the transition areas, it has been agreed to operate each of the five Priority 1 measures for five years only, covering the period 2000-2004. This will ensure sufficient funding is available in each measure for each year to support a critical mass of activity. Credit will be given in the scoring and selection system to projects which demonstrate the capacity to be sustainable following the end of Structural Fund support.
Priority 1 Business and Ideas: ERDF Allocation by Year: Transition Areas (million euros) 2000 2001 2002 2003 2004 1.1 Business Starts 5.528 4.375 3.267 2.479 1.013 1.2 Competitive SMEs 11.056 8.750 6.534 4.958 2.025
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1.3 Investment Finance 5.528 4.375 3.267 2.479 1.013 1.4 Knowledge Economy 5.528 4.375 3.267 2.479 1.012 1.5 Investment in Premises 9.212 7.292 5.446 4.132 1.687 Total 36.852 29.167 21.781 16.527 6.750
The key outputs, results and impacts for the Priority are detailed below for both the Fully Eligible Objective 2 Area and the Transitional Objective 2 Area. The results of Priority Level actions are presented against gross sales and gross additional job indicators. Impacts at the Priority Level are presented for net additional jobs and GDP indicators. The net cost per job is also presented.
Business and Ideas Quantified Targets Fully Transition Total Eligible Area Area Outputs New companies assisted 5,000 2,450 7,450 SMEs assisted 12,000 5,880 17,880 Premises constructed (m2) 137,000 67,130 204,130 Results New jobs created 22,000 10,780 32,780 Jobs safeguarded 11,480 5,625 17,105 Increased sales (£m) 1,747 856 2,603 Sales safeguarded (£m) 926 453 1,379 Impacts Net additional jobs 12,582 6,165 18,747 Net jobs safeguarded 6,314 3,094 9,408 Net additional value added (£m) 377 185 562 Net value added safeguarded (£m) 189 93 282
It is envisaged that Priority 1 will provide support to a substantial number of SMEs in the Plan Area. Over the seven year programme period, approximately 18,000 SMEs will be assisted to develop and grow their business, of which a quarter will be provided with fairly intensive support. A further 7,450 new or early life SMEs will be assisted in overcoming the pitfalls faced by new companies seeking to develop a sustainable profitable business. Every £1 of public support is expected to generate increased sales of between £7 and £12 within the assisted company, depending on the type of assistance provided. An average increase in turnover of £70,000 has been assumed in order to generate one new FTE job, or safeguard an existing job which would have been lost in the absence of support from the ERDF-funded project.
Priority 1 will also support substantial investment in industrial and commercial premises, both refurbishment and redevelopment of existing accommodation as well as new build. Assuming an average cost of £700 per m2 of premises, it is forecast that 204,000m2 of premises will be provided over the seven years of the Programme, capable of accommodating almost 4,700 jobs. This employment forecast assumes an average floorspace density of 1 person per 30m2 of floorspace.
The gross employment target for Priority 1 is approximately 50,000 FTE jobs, of which two thirds will be new and the remainder will be safeguarded. The net
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employment impact will, however, be somewhat lower at 28,000 jobs due to deadweight and displacement effects.
Achievement of the targets will be measured against the following baselines:
PRIORITY 1 KEY BASELINE DATA Indicator Value Year Source Number of SMEs 90,720 1997 IDBR Number of people employed in SMEs Tbc 1997 IDBR Number of manufacturing SMEs 9,800 1997 IDBR Number employed in manufacturing SMEs Tbc 1997 IDBR Number of service sector SMEs 64,000 1997 IDBR Number employed in manufacturing SMEs Tbc 1997 IDBR % of employment in high tech sectors 2.6% 1997 AES % employed in fast growing sectors 35.3% 1997 AES % of employment in declining sectors 29.2% 1997 AES VAT businesses per 10,000 population 34 1997 Customs & Excise Business survival rates 56.5% 1997 Customs & Excise New VAT registrations per annum 10,435 1997 IDBR % of the workforce self employed 10.8% 1997 Labour Force Survey
Cross-Cutting Themes - Business and Ideas
The North West Objective 2 SPD has three cross cutting themes – Equal Opportunities, the Information Society and the Sustainable Development. Although these cross cutting themes have not been allocated separate sums of monies, the three “vertical” Priorities will make important contributions to the objective of each theme. The full details of each theme are presented in a later section of the Complement.
With regard to Equal Opportunities and Business and Ideas, there is a need to increase the number of women owning and managing businesses. As noted in Chapter 2 of the SPD, the North West has a lower than average number of businesses, and part of the strategy to re-dress this imbalance involves encouraging and supporting more women entrepreneurs The Programme will encourage more consideration to be given to how and when business support is delivered, and accompanying support activity needed to increase the participation of women.
The analysis in Chapter 3 also noted a major pay gap between men and women. This partly reflects the poor representation of women in higher paid jobs, and the opportunity exists to secure a higher proportion of new jobs generated by the Programme for women.
The Equal Opportunity targets for Priority 1 are detailed below:
Business and Ideas Quantified EO Targets Fully Eligible Transition Total Area Area Outputs Total EO Total EO Total EO New companies assisted 5,000 2,000 2,450 1,000 7,450 3,000
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SMEs assisted 12,000 3,3001 5,880 1,5001 17,880 4,8001 Results New jobs created 22,000 8,800 5,625 2,250 32,780 11,050 1 Owned or managed by EO target group
The new company target will be met through Measure 1.1. while measures 1.2, 1.3 and 1.4 will contribute to the other targets. It is not possible to forecast a measure by measure breakdown for these targets.
With regard to the Information Society, there is a need and an opportunity to encourage businesses to take up the business opportunities offered by ICT. This includes using ICT to reach new markets, and also to use the technology to improve productivity within companies. This is a major opportunity area for all types of businesses, not just those which are involved with ICT manufacture. The resources in Measure 1.4 will be available to help companies to take advantage of new development around the Information Society, particularly where innovation is a feature. ICT will however be a theme within all of the Measures. There is also a need to ensure that premises provide by the Programme are able to offer appropriate ICT access.
The Information Society targets for Priority 1 are detailed below:
Business and Ideas : Information Society Quantified Output Targets Measure Target No. of e-commerce/Internet based new businesses 1.1 750 No. new businesses making use of e-commerce 1.1 4,000 No. of existing SMEs developing new ICT systems 1.2 3,000 No. of existing diversifying through e-commerce 1.2 3,000 No. SMEs/start-ups assisted in securing investment 1.3 1,000 finance will be e-commerce and/or e-business ventures SMEs involved in networks/clusters will be using 1.4 4,000 advanced information society applications No. projects receiving assistance will develop innovative 1.5 2 ICT facilities within new premises
Sustainable development principles are an important underlying theme of this Priority. There is an opportunity to support companies to be more environmentally responsible and at the same time reduce costs through, for example, waste and energy audits. There are also a number of opportunities arising from environmentally friendly technology and the growth of businesses involved in environment related products. The Programme will provide appropriate business support to take advantage of these opportunities.
There is also an opportunity to build energy and waste efficiency into the design of new premises, and also to re-use redundant buildings for the benefit of SMEs.
The Sustainable Development targets for Priority 1 are detailed below:
Priority 1 Business and Ideas Quantified Sustainability Targets Measure Target New start ups in environment-related sectors 1.1 350 Target support on SMEs specialising in environment 1.2, 1.4 600 related products and processes
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Support for businesses to undertake energy, waste and 1.1,1.2 700 resource reviews and audits Target finance on SMEs in environmental-related sectors 1.3 90 Schemes which assist the development of new 1.4 300 environmental technologies or demonstrate environmental management techniques Building design incorporating energy efficiency and use of 1.5 8 recycled materials Reuse of redundant buildings 1.5 8
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MEASURE 1.1: CREATION AND ESTABLISHMENT OF ENTREPRENEURIAL BUSINESS STARTS
Introduction
This Measure aims to restore the enterprise deficit in the Objective 2 region by stimulating new entrepreneurial business start-ups and increasing their survival rates. Its principal concern is to expand and diversify the region’s SME base by creating a business environment in which entrepreneurs have the confidence to invest in their ideas and to be supported in developing them. The Measure will support the mainstreaming of innovation activities through all business support services and aims to ensure that effective linkages are made with knowledge transfer and incubation services at all levels, especially HEI linked incubators.
Interventions will be customised to meet the individual needs of start-ups and potential start-ups with strong growth aspirations. Packages of support will fully complement the activities of the Small Business Service and in particular the recent DTI initiatives to promote high growth start-ups. While resources will be channelled towards high quality business propositions with the capability to create additional jobs and income, account will also be taken of the particular needs of start-ups in the social economy and not-for-profit sector, the rural areas, and those proposed by women and disadvantaged ethnic groups.
Amid the portfolio of business start-ups supported by this Measure there will inevitably be successes and failures. The challenge for the Objective 2 partnership is to ensure that, in aggregate, the Measure creates an enterprising culture which attracts and retains new entrepreneurs in sufficient numbers to generate a critical mass of new industries and businesses to support self-sustaining and cumulative growth.
This measure will focus support on those developing enterprises with employment and/or growth potential, as distinct from those seeking to secure an income for themselves. Where individuals are moving into self employment as a means of securing a “wage”, they will be supported through the Objective 3 Regional Development Plan.
Regional Situation
The analysis presented in the SPD provides compelling evidence of the need for the Objective 2 region to restructure and stimulate new activity in its economy. Specific problems identified in the region are:
· low employment in growing sectors – only 71% of employment in the Objective 2 area is in growth sectors, compared to a national average of 85%. · low business density – the Objective 2 area has 13% fewer businesses per head of population than the UK average, a ‘shortage’ of 12,200 businesses. · low rates of business formation – the North West region has the lowest rate in the UK for new VAT registrations in manufacturing. · low business start-up survival rates - whilst average survival rates for new businesses have improved over the last four years, new firms in the Objective 2 area remain less likely to be trading three years after setting up than nationally. · low levels of self-employment – the Objective 2 area self-employment rate stands at 92% of the UK average.
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· under-representation in high technology industries - in comparison to other UK regions the North West has a lower proportion of business units and employees in high technology sectors.
In light of these conditions, the development of new business is pivotal to the revitalisation of the region’s economy, not only as a potential source of new jobs and wealth, but also as the driving force in accelerating the region’s transition into the new knowledge economy. The opportunity is significant: the region has a ready supply of potential entrepreneurs within its universities and colleges, within its local communities, and among its workforce, and mechanisms need to be found to tap into and exploit this rich fund of knowledge and innovation.
The region needs to redress its competitiveness gap by concentrating entrepreneurial effort on its economic strengths and opportunities. The Objective 2 region is very well placed, for instance, to capitalise on the opportunities presented by its world class excellence in manufacturing, the growth in e-commerce, the continued expansion of the tourism and leisure sectors, and the potential of the academic base as a source of entrepreneurial high technology spin-outs.
Measure Objective
The objective of Measure 1.1 is:
To accelerate new business development by investing in entrepreneurship, innovation and e-commerce and improving the creation and survival rates of new businesses.
Eligible Activities
Actions under this Measure will be fully complementary to main UK government programmes and will be integrated with other Measures in this Programme, in particular those designed to improve access to finance for SMEs (Measure 1.3) and to develop customised business accommodation for new and expanding SMEs (Measure 1.5), and with the North West Objective 3 Programme. This measure will support HE/FE initiatives on competitiveness and innovation and encourage synergy with key national programmes
Measure 1.1 will support solely revenue expenditure.
1. business counselling and consultancy 2. business plan appraisal 3. innovation and product development for new start ups 4. mentoring, management and human resource development 5. entrepreneurship development 6. technology awareness 7. spin-outs from major companies and HEIs 8. e-commerce development 9. social economy and not-for-profit start-ups
Financial Allocations
106 million euros will be incurred on Measure 1.1 projects, of which two-thirds is designated to assist new companies in the eligible area. ERDF contributions will be matched by the UK public sector, with a further private sector contribution of 2 million euro in the eligible area, and 1 million euro in the transition area.
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Measure 1.1 Entrepreneurial Business Starts Financial Profile ERDF UK Public UK Private Total Cost Eligible Area 34.827 34.827 2.000 71.654 Transition Area 16.662 16.662 1.000 34.324
Outputs, Results and Impacts
Based on total expenditure of 71.6 million euros in the eligible area and 34.3 million euros in the transition area, it is anticipated that 5,000 and 2,450 new companies will be provided with substantive assistance. This assumes an average public contribution of between £5,000 and £20,000, reinforcing the emphasis on creating and developing high growth start-ups.
For every £10,000 of public support, turnover in assisted companies is expected to help generate £90,000 of turnover, with £70,000 of turnover supporting one new job. Based on evaluation evidence of previous schemes, the target survival rates of assisted new start companies after 18 and 36 months are 80% and 65% respectively. These targets are ambitious, again reflecting the desire to focus support on high- growth start ups in new and expanding sectors.
Given the focus on creating new start companies in new sectors, medium levels of deadweight (30%) and displacement (40%) have been assumed. A standard regional multiplier of 1.2 has also been applied in the conversion of new jobs created to net additional jobs.
MEASURE 1.1 QUANTIFIED TARGETS Fully Transition Total Eligible Anticipated Total Spend (Meuro) 71.654 34.324 105.978 EU Support (Meuro) 34.827 16.662 51.489 Fields of Intervention:
163 Business advisory services 164 Shared business services Outputs New companies assisted 5,000 2,450 7,450 Spin out companies assisted 70 30 100 New products/processes developed 200 80 280 Results New jobs created 4,500 2,205 6,705 Increased sales (£m) 315 154 469 % of new companies assisted surviving 80 80 - more than 18 months % of new companies assisted surviving 65 65 - more than 36 months Impacts Net additional jobs 2,268 1,111 3,379 Net additional value added (£m) 68.0 33.3 101.3
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Appraisal and Selection Criteria
The criteria will take into account:
a. Scale of support channelled directly to the new enterprise b. Focus on priority sectors c. Targeting of potential high growth start ups d. Extent of aftercare and ongoing support
Final Beneficiaries
Small Business Service and SBS contractors, North West Development Agency, enterprise and development agencies and other intermediary bodies assisting SMEs, local authorities, Chambers of Commerce, higher and further education institutes, voluntary sector.
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MEASURE 1.2: INCREASING THE COMPETITIVENESS OF ESTABLISHED SMEs
Introduction
This Measure aims to increase the competitiveness of the Objective 2 region by supporting the growth of existing businesses. It is primarily concerned with injecting dynamism into the region’s SME base and stimulating the development of sectors with long term growth potential. The SMEs supported under this Measure will be among the most progressive in their sector and will contribute to the competitiveness of the region by creating and sustaining competitive advantage within their own marketplace.
The Measure will stimulate demand among SMEs with growth aspirations, particularly those whose use of business support services is under-developed. Suppliers in the public and private sectors will be encouraged to develop long-term relationships with SMEs and to focus on high impact services such as process and product design, management development services, and ICT and technology-based solutions.
The Measure will contribute to the strategic objectives of the Programme by stimulating creativity and change to create new market opportunities and new high quality jobs. This means focusing support on emerging and growth sectors, such as the priority sectors identified in the Regional Strategy, and on businesses in other sectors with high growth potential.
Regional Situation
The Objective 2 area, like many other regions of the UK, is undergoing a period of industrial transition in which traditional large-scale production is being replaced by smaller, more flexible knowledge-based industries predominantly in the service sector. It is a major anxiety in times of rapid industrial change that on many indicators of competitiveness the Objective 2 area lags well behind EU and UK averages. Grounds for concern are raised by a number of factors:
· a rapid rate of business decline – in 1998 the Objective 2 area had almost 4.6% fewer businesses in than in 1994, compared to a 0.5% reduction in the UK, indicating a serious weakness in the region’s ability to replenish its stock of businesses. · a weak rate of employment growth – in spite of growing by 5% between 1993 and 1997, total employment in the Objective 2 area continued to fall as a share of total national employment. · weaknesses in the region's industrial structure – an over-dependence on manufacturing and an under-representation in fast-growing and high technology industries, renders the Objective 2 region disproportionately exposed to adverse changes in the macro economy. · low employment levels in growth sectors – 71% of employment in the Objective 2 area is in growing sectors, compared to 85% in the UK. · poor awareness of ICT and Web-enabled technologies – just over half all SMEs' employees use a computer and the proportion is even lower in smaller businesses and in the rural areas. · low levels of R&D Investment – in comparison to the best performing regions of the UK, business enterprise R&D in the North West region is significantly lower. This reflects a number of intractable historical and institutional circumstances, but
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suggests that even greater efforts need to be made to increase R&D investment in the Objective 2 area.
Despite this generally downcast view of the region, there are a number of reasons for optimism. As the quadrant analysis in Chapter 2 shows, many emerging sectors – a number of them in manufacturing – have relatively high levels of employment and, providing the national economy continues to grow, the prospects for these and newly emerging sectors are reasonably good.
Rationale for Intervention
The continuing emphasis on competitiveness policy at EU, national and regional level is testimony to the success of previous EU and UK business support programmes in stimulating the SME sector. High quality business support is now generally acknowledged to improve the performance of individual SMEs and has been shown to have a positive economic impact by stimulating business growth and creating new jobs4.
In spite of this, as a recent survey for the NWDA5 demonstrates, there is a low uptake by SMEs in the Objective 2 area of business support services provided by either the private or public sector: nearly two thirds of SMEs surveyed had not accessed business support services over the previous two years, and 85% said they had no intention of doing so in the future. Furthermore, business support usage tended to be concentrated larger, highly sophisticated SMEs and was heaviest in businesses with a strong growth record. Just under half the SMEs who have strong growth aspirations, estimated to be in excess of 30% of all SMEs, are also among those not currently using business development services.
There are thus significant opportunities for Objective 2 intervention in business support, provided it is carefully positioned at the quality end of the market. In particular it must complement and not duplicate the provision offered by the new Small Business Service and other public agencies such as the universities and colleges.
Particular emphasis will be placed on mainstreaming the innovation process and ensuring that established SMEs have greater access to knowledge transfer and R&D services, especially those linked to the science and technology base, including improving the commercial exploitation and management of intellectual property. In rural and peripheral areas, SMEs face problems in accessing technologies and technology support services due to their location. There is a need to ensure local businesses have cost effective access to information and support management to ensure they achieve and maintain a competitive position in the market place.
There will remain a need for generic and introductory business advice. In some instances such support will be required to help identify high growth companies. This measure will support general advisory services, although it is envisaged that no more than 15% of measure resources will be devoted to such activities. The intention is to devote the vast majority of measure resources to provide more intensive and thus more effective support. As such, the intention is to focus on those parts of the
4 Working Papers of the Cambridge Business Research Centre (CBRC). The CBRC is an ERSC-funded research centre which last year completed the first comprehensive national survey of business support services, using data from a sample of almost 2500 UK SMEs.
5 Segal Quince Wicksteed (1999) Review of Business Development Needs in the North West: A Final Report for the North West Development Agency
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business base with the greatest opportunity to secure sustainable benefits for the region.
Measure Objective
The objective of Measure 1.2 is:
To raise the productivity and competitive performance of the region’s existing business, particularly through support for innovation and e-commerce, and to improve the performance of assisted SMEs in terms of increased turnover and increased number of jobs.
Eligible Activities
Actions will be closely integrated with, in particular, Measures 1.3, 1.4 and 1.5 and will also link closely to the North West Objective 3 Programme.
Measure 1.2 will support solely revenue expenditure.
1. business counselling, advice, and consultancy (e.g. support for developing new markets, ICT development, innovation and product development, customer relations, marketing, sales and distribution, management and human resource development) 2. technology and environmental audits 3. technology transfer 4. revenue grant aid to assist SMEs develop their productive capacity 5. support for social economy and not-for-profit enterprises. 6. support for e-commerce development 7. support to make companies aware of the benefits and opportunities of environmentally friendly practices and products
Financial Allocations
Almost 200 million euros has been earmarked for Measure 1.2, 65% of which will be taken up by SMEs located in the eligible area. ERDF monies will be matched by the UK public sector, with a further 5 million euros drawn from the private sector towards eligible project costs. Private sector investment resulting from the ERDF project is treated as leverage rather than co-financing.
Measure 1.2 Competitiveness of Established SMEs ERDF UK Public UK Private Total Cost Eligible Area 63.850 63.850 3.000 130.700 Transition Area 33.323 33.323 2.000 68.646
Outputs, Results and Impacts
In order to achieve the sales and employment results required to make a significant impact on the regional economy, it is engaged that 85% of resources will be allocated to projects offering substantive support to individual SMEs, with the remaining 15% allocated to projects offering general advice or support of a more limited nature.
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Based on total expenditure of 130.700 million euros in the eligible areas and 68.646 million euro in the transition areas, it is expected that substantive assistance will be provided to 12,000 SMEs. The bulk of SME assistance is assumed to be within a range of £5,000 and £25,000, although for many cases this will be achieved with multiple tranches of support over the lifetime of the Programme.
It is anticipated that each £1 of public support will lead to an increase in sales of £10 in the assisted SME. This is an average sales increase, and it recognised that not all assisted SMEs will achieve this level of growth. Many assisted SMEs, due to trends in their own sectors, will achieve a more modest sales performance, although it is expected that these lower averages will be counterbalanced by a smaller number of “star performers”.
Increased sales and improved company performance are expected to generate a gross employment effect of 15,056 FTE jobs, of which 7,528 will be new jobs and 7,528 safeguarded. Whilst it is hoped that the Measure will generate primarily new jobs, it is recognised that many SMEs in all parts of the Plan Area require to become more competitive in order to avoid loss of employment.
Medium levels of deadweight (30%) and displacement (40%) have been applied to the gross employment results. A standard regional multiplier of 1.2 has also been applied in the conversion of new jobs created to net additional jobs.
Measure 1.2 Quantified Targets Fully Eligible Transition Total Anticipated Total Spend (Meuro) 130.700 68.646 199.346 EU Support (Meuro) 63.850 33.323 97.173 Fields of Intervention 162 Environmentally-friendly technologies, clean and economical energy technologies 163 Business advisory services 164 Shared business services Outputs SMEs assisted 8,000 3,920 11,920 SMEs assisted in priority sectors 3,000 1,470 4,470 SMEs introducing new 500 245 745 products/processes Results New jobs created 5,062 2,466 7,528 Jobs safeguarded 5,062 2,466 7,528 Increased sales (£m) 405 198 603 Sales safeguarded (£m) 405 198 603 Impacts Net additional jobs 2,551 1,250 3,801 Net jobs safeguarded 2,551 1,250 3,801 Net additional value added (£m) 76.5 37.5 114 Net value added safeguarded (£m) 76.5 37.5 114
Appraisal and Selection Criteria
The appraisal and selection criteria will take into account:
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1. Targeting of support on priority sectors 2. Extent to which support is channelled directly to the SME 3. Extent of aftercare and on-going support
Final Beneficiaries
Small Business Service and SBS contractors, North West Development Agency, local authorities, higher and further education institutes, enterprise and development agencies and other intermediary bodies assisting SMEs, the voluntary sector.
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MEASURE 1.3: ACCESS TO INVESTMENT FINANCE FOR GROWTH SMEs
Introduction
This Measure seeks to stimulate higher rates of business formation, survival and growth by encouraging new investment in entrepreneurial businesses located in the Objective 2 area. Its fundamental concern is to address the difficulty experienced by SMEs in accessing investment finance and to create a regional market for investment finance that encourages ambition, rewards risk, and does not unduly penalise failure. The SMEs supported under this Measure will be demonstrably growth-oriented but will lack the capability to secure investment finance through normal market routes.
The Measure will stimulate demand for investment finance among SMEs, by encouraging suppliers in the public and private sectors to work in partnership to create new, more easily accessible financial instruments and to help SMEs better manage investment risk. The Measure will promote intervention in the markets for debt and equity finance, targeting start-up businesses and existing SMEs at any stage of their lifecycle.
The Measure will contribute to the strategic objectives of the Programme by investing in growth SMEs to create new market opportunities and new high quality jobs.
Definitions
The different sources and types of investment finance available to SMEs can be categorised into the following market groups:
· debt finance – overdrafts and loans from banks and other financiers; · private equity – two types exist, formal and informal: formal private equity is provided by venture capital firms, banks, and special investment schemes; informal private equity is generally sourced through individual investors such as business angels. · public equity markets – normally only appropriate for larger SMEs, investment capital is raised through second-tier finance markets such as the UK’s AIM (Alternative Investments Market) and the Brussels-based EASDAQ (European Association of Securities Dealer Automated Quotation);
This Measure seeks to address failures in each of these markets, though the rationale and the type of intervention appropriate for each will differ significantly.
Regional Situation
The latest national data on investment activity in the UK as provided by the British Venture Capital Association6 indicated a 23% growth in private equity investment during 1998. Growth in the North West region compared favourably at 22% but was much slower than in other regions, for example East Anglia (96%), Scotland (40%), and the South East (38%). Other features emerging from the national data included:
· a continuation of the trend towards larger scale investments such as management buy-outs and buy-ins; · a lower proportion (less than 5%) of total investment in start-up and early stage businesses;
6 British Venture Capital Association (1999) Report on Investment Activity
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· strong investment growth in high technology businesses, especially computing, and biotechnology, engineering machinery, and media technology.
Notwithstanding this generally positive picture, the evidence suggests that lack of access to finance is still a major inhibitor to business growth. The NWDA’s recent report on business development needs5 found that finance was the topmost constraint on business development among North West SMEs – 39% of the businesses surveyed cited “insufficient finance” as a major constraint on their development. In Cumbria, a sub-regional SMEs survey7 identified significant demand for investment finance in the £50,000 to £200,000 range, but also found very low levels of awareness of the investment finance market.
Rationale for Intervention
The European Commission’s 1998 paper Risk Capital: A Key to Job Creation in the European Union8 stated: “Developing risk capital markets is a necessary pre- condition for major job creation in Europe. Entrepreneurs must be able to access the right financing, at the right price, in the right place and at the right time to develop their businesses and ideas”. These themes were echoed in the UK Government’s Competitiveness White Paper and in the subsequent DTI consultation paper “Addressing the Equity Gap” 9. Recent initiatives such as changes to Capital Gains Tax, the Enterprise Fund and the emerging Regional Venture Capital Funds (a joint initiative with the European Investment Bank) underscore the Government’s commitment to entrepreneurship and competitiveness. The North West Regional Strategy explicitly sets out to address failures in the regional market for investment capital as one of its prime objectives.
The impact of investment finance on business performance can be significant. For example, recent research by the British Venture Capital Association on the benefits of venture capital-backed businesses found that over the four years to 1998 UK venture backed companies:
· increased numbers employed by 24% against a national growth rate of 1.3% per annum; · increased turnover by 40% per annum – double that achieved by FTSE 100 companies; · increased pre-tax profits by 24% per annum; · increased exports by 44% per annum against a national growth rate of 8% per annum. · Increased investment by 34% per annum against a national increase of 7% per annum;
However, as the Bank of England reports10, there are many cases where the funding requirement of a business are greater than those that can be met by small scale providers of finance, but are not substantial enough to be considered by the large equity providers – the so-called “equity gap”. Evidence provided in “Addressing the Equity Gap” suggests a significant unsatisfied demand for external investment finance, finding “a current market failure in the provision of equity finance in amounts
7 West Cumbria Development Agency (1998)
8 European Commission Paper for ECOFIN (21 April 1998) “Risk Capital: A Key to Job Creation in the European Union”
9 DTI (1999) “Addressing the Equity Gap”
10 Bank of England (2000) Finance for Small Firms – A Seventh Report.
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below £500,000 for SMEs with growth aspirations”. It is estimated that around 30% of UK SMEs have a desire to grow and are not averse to investment finance, but only around 10% actually secure funding. Demand is weak because SMEs in the UK are traditionally reluctant to seek equity finance, citing the following internal inhibitors11:
· loss of control though dilution of equity share. · loss of management freedom of action; · pressures to change the management team; · high financing costs; · lack of knowledge of external financiers;
The UK supply of investment finance, whilst well-developed by European standards, has largely moved away from seedcorn and early stage capital, driven by its success in making larger investments. A number of reasons have been put forward to explain this failure in the market:
· unwillingness to invest in businesses activities which are perceived to be high risk; · lack of commercial viability of smaller investment funds; · proportionally higher costs of monitoring smaller investments.
These problems have been found to be especially acute for two groups of businesses: high technology businesses12 (mainly because of the requirement for large longer-term investments), and businesses operating in deprived areas.
A significant opportunity therefore exists for public intervention in this field, in particular to establish revolving (self-sustaining) investment funds, as has been demonstrated by, for instance, the Merseyside Special Investment Fund13. Preference will be given to projects that target growth SMEs and which provide investment finance as a package together with management advice and other forms of business support.
Actions will also take account of the need to create improved linkages between venture funding and innovation, particularly in terms of incubation services and access to the science and technology base, including innovatory management approaches, such as mentoring.
Measure Objective
The objective of Measure 1.3 is:
To increase the number of assisted investments below £500,000 in new and established SMEs and to raise the productivity and competitive performance of assisted SMEs in terms of increased turnover and increased number of jobs.
11 Manchester Business School (1999) The Financial Development of Smaller Private and Public SMEs. 12 Bank of England (1996) Financing of Technology-Based Small Firms
13 The MSIF is supported by Objective 1 ERDF.
33 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Eligible Activities
Actions will be designed to complement existing initiatives, in particular the North West Development Agency’s soon to be established Regional Venture Capital Fund and the activities of the Small Business Service.
Measure 1.3 will support solely revenue expenditure.
1. new equity investment funds and venture capital funds 2. loan guarantees and subsidised loan funds 3. interest rate rebates 4. seed corn funding schemes 5. support for the costs of loan schemes 6. assistance for business propositions seeking investment finance 7. provision of information and signposting 8. investment finance mentors 9. developing exit mechanisms for investors 10. support for the development of e-commerce and e-business services 11. linkages between venture funding and incubation services
Financial Allocations
39 million euros of ERDF has been earmarked for Measure 1.3 schemes, a proportion of which will co-finance the Regional Venture Capital Fund being established by North West Development Agency. The ERDF contribution will be matched by the UK public sector.
Measure 1.3 Access to Investment Finance ERDF UK Public UK Private Total Cost Eligible Area 23.218 23.218 23.000 69.436 Transition Area 16.662 16.662 16.213 49.537
Outputs, Results and Impacts
Measure 1.3 investments will vary considerably in size, recognising the range of finance needs of different types of businesses across the Plan Area. In determining the quantified targets for Measure 1.3, a range for public sector costs of between £20,000 and £100,000 has been assumed. It is envisaged that the majority of investments will be at the lower end of this range.
Every £1 of direct investment is forecast to result in an average increase in sales in beneficiary SMEs of £10, giving an overall sales target of £662m, assuming 5% of resources goes on administration. Whilst the measure aims to focus on companies with strong growth potential, it is recognised that for many firms the aim will be to maintain existing employment levels, particularly in the short to medium term. It is assumed, therefore, that 70% of gross jobs resulting from the increase in sales will be new, with remaining 30% safeguarded jobs. £70,000 of turnover is assumed to create or sustain one FTE job.
34 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Measure 1.3 Quantified Targets Fully Eligible Transition Total Anticipated Total Spend (Meuro) 118.97 69.436 49.537 3 EU Support (Meuro) Fields of Intervention 163 Business Advisory Services 165 Financial Engineering Outputs SMEs assisted 1,100 780 1,880 Results New jobs created 3,800 2,735 6,535 Jobs safeguarded 1,628 1,128 2,756 Increased sales (£m) 266 200 466 Sales safeguarded (£m) 114 82 196 Impacts Net additional jobs 2,234 1,652 3,886 Net jobs safeguarded 957 676 1,633 Net additional value added (£m) 67.0 49.0 116.0 Net value added safeguarded (£m) 28.7 20.1 48.8
Selection Criteria
The appraisal and selection criteria will take into account:
1. Long term sustainability of funding mechanism 2. Extent of related business and management support for beneficiary SMEs 3. Rigour of investment selection procedures
Final Beneficiaries
North West Development Agency, Small Business Service and SBS contractors, enterprise and development agencies and other intermediary bodies assisting SMEs, local authorities, the private sector.
35 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
MEASURE 1.4: DEVELOPING THE REGIONAL KNOWLEDGE ECONOMY: SUPPORTING BUSINESS INNOVATION AND NETWORKING
Introduction
This Measure aims to accelerate the region’s transition to a knowledge-based economy by stimulating creativity and innovation and improved access to advanced R&D and information society technologies. Business will be encouraged and supported to play a leading role in the development of a cutting edge digital culture across the region, especially through the innovative use of business networking and advanced e-commerce solutions. Particular emphasis will be placed on demand-led innovation and support will be targeted at new initiatives which add value to both existing and emerging networks. At the same time actions will address related competitive challenges such as the capacity to innovate and to develop new creative cultures and management competencies, especially in relation to intellectual property and the management of IPR. This will include encouraging greater synergy between innovation and access to investment finance. Actions will encourage businesses to share knowledge and help to instil collaborative attitudes and share knowledge within both ‘horizontal’ networks (bringing groups of SMEs together with other actors) and ‘vertical’ supply chain networks (transmitting know-how up and down the supply chain and embedding larger firms within the regional economy). The Measure will promote greater access to and involvement in the exploitation of knowledge and innovation across the Objective 2 region by:
· enabling SMEs to benefit from the exploitation of the science and technology base; · collaboration and partnership between SMEs and public agencies, in particular HEIs and FEIs, and other business support agencies; · developing closer links with large businesses in the region; · the development of substantive inter-firm collaborative projects including joint research, joint ventures, and the joint exploitation of new markets and customers; · inter-firm trading and supply chain developments; · enabling SMEs to broaden and deepen their knowledge through ‘collective learning’; · encouraging SMEs to operate as groups to leverage better quality business support from public and private agencies, for instance by developing funding applications; · providing sources of intelligence that are accessible to specific groups of businesses and organisations in the region.
Activities will be driven and led by business and will be self-sustaining through a process of continual renewal and growth. Resources will be deployed to accelerate the process of knowledge exploitation to bring about increased innovation and more rapid rates of SME growth. Interventions will therefore be facilitative in approach and method14, such that networks and clusters are, for instance, used as regional demonstration models, encouraged to submit new funding applications, and broadened through associations with other business networks and large businesses.
Besides contributing to the Programme objectives by delivering quantifiable benefits to individual businesses, this Measure will also increase the knowledge assets held by the Objective 2 region itself through, for example, the creation of new sources of
14 See in Lagendijk, A. (1999) Good Practice in SME Cluster Initiatives. Lessons from the ‘Core’ regions and beyond. Centre for Urban and Regional Studies. (Funded by the EU ADAPT Programme)
36 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
market intelligence for use by business groups and support organisations, the development of new skills and an improvement in labour market conditions, and through much enhanced technological capabilities.
Regional Situation
Various examples of knowledge-based clustering exist in the UK such as those in Cambridge and along the M4 corridor (computer software), London (furniture industry), and Sheffield (the cultural industry). Many of these are closely aligned to the local HE and R&D base. While there is some evidence to suggest that networks and clusters are developing in a number of North West sectors, for instance in aerospace, chemicals, food, and biomedical/life sciences, the Objective 2 region is underdeveloped in comparison to other more advanced areas of the UK where networking and collaboration is a well-established feature of the business development process15.
In his report on cluster development in the biotechnology sector16, Lord Sainsbury identified ten critical success factors for cluster development:
i) the presence of a strong science base; ii) an entrepreneurial culture; iii) a growing company base; iv) the ability to attract key staff; v) premises and infrastructure; vi) the availability of finance; vii) business support services and large companies in related industries; viii) a skilled workforce; ix) effective networking; x) a supportive policy environment
Against these criteria, the Objective 2 region is reasonably well positioned to develop and exploit clustering opportunities. On the most important factor – the presence of strong science base – the region has a significant opportunity to take advantage of its large HE and R&D community as a catalyst for the exploitation of knowledge. Against other factors the region is possibly less favourably placed, though the other Measures in this Programme, together with Objective 3, will help create conditions more conducive to the exchange and transfer of knowledge. Studies in Cumbria17, however, suggest that isolation from the main production and academic centres can act as a serious inhibitor to inter-firm linkages, and this remains a serious concern.
Rationale for Intervention
The capacity of SMEs to be innovative is a critical factor in developing regional competitive advantage. In many SMEs, including those aspiring to grow, the potential for knowledge exploitation and innovation is frequently underdeveloped or overlooked completely. In recent years attention has focused on the effectiveness of business networks and clusters, formally or informally structured, as vehicles for the creation and dissemination of innovation and the accumulation of knowledge.
15 Lawson et al (1997) Inter-firm links between regionally clustered high technology SMEs. Cambridge Business Research Centre
16 Lord Sainsbury (Chair) (1999) Biotechnology Team Report. DTI
17 Durnin, J. and Peck , F. (unpublished). Inter-Firm Networks and the Relevance of Proximity: The Case Of Cumbria. University of Northumbria Carlisle Campus Centre for Regional Economic Development.
37 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Certainly the policy imperative at EU, national and regional level is considerable. The Commission’s Thematic Evaluation of Structural Funds Impacts on SMEs2 states: “Clustering is one of the most innovative aspects of current Structural Funds programmes. It reinforces the idea that future SME support should not only deal with technology and business strategy but should also focus on benchmarking and helping SMEs to learn from each other, as well as exploiting the economies of scale derived from bringing SMEs together in networks.” UK policy also corresponds fully with the aspirations of the Measure:
· the Government’s Competitiveness White Paper explicitly sets out to develop and exploit the knowledge-based economy, especially through its aim to make the UK the best environment in the world of e-commerce;
· the DTI’s Clusters Policy seeks to map out the current level of cluster activity, facilitate the creation of new clusters, and provide direct support for cluster-based activity.
· the North West Regional Strategy sets a major objective “to develop world class clusters of businesses which offer outstanding employment and growth potential”;
· the North West Regional Innovation Strategy envisages a powerful role for business networks in stimulating innovation and sets out a number of strategic processes in which networking will play a crucial part;
· the DTI’s Regional Innovation Fund18 aims “to encourage collaboration and competition, create a magnet for investment, nurture new business start-ups and help small businesses to grow”.
Whereas in the 1994-99 Structural Funds Programmes SME innovation was closely aligned to the use of new and advanced technologies, this Measure broadens out the definition of innovation to be linked with the development of the knowledge base, the application of appropriate technologies, with a specific emphasis on advanced e- commerce solutions and an outward-looking, diversifying approach to market development. The scope for the development of the knowledge base in the Objective 2 region is significant, particularly in light of the potential for the growth of indigenous sectors identified in the preceding chapters.
Measure Objective
The objective of Measure 4 is:
To increase the number of SMEs involved in business clusters, networks and innovation partnerships in the region, to stimulate new joint collaborative ventures and greater take up of advanced R&D opportunities in order to raise the productivity, creativity and competitive performance of SMEs in terms of increased turnover and increased number of jobs.
18 The Regional Innovation Fund was announced in the Chancellor’s 2000 Budget and will be administered by the RDAs.
38 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Indicative Actions
Activities supported under this measure will work in concert with, in particular, Measures 1.1, 1.2 and 1.5, and also the North West Objective 3 Programme.
Measure 1.4 will support both revenue and capital expenditure.
1. mapping existing SME business networks 2. benchmarking and dissemination of best practice 3. establishing business-led sector groups 4. collaborative innovation and research programmes 5. supply chain initiatives 6. knowledge-based incubation support services 7. individual sector group innovation strategies 8. strategic cross-network initiatives 9. HE/FE advanced innovation initiatives 10. virtual business networks 11. development of SME links with the HE sector 12. pilot and demonstration projects 13. development of advanced e-commerce solutions 14. 'gateway'/'portal' Internet/Web sites 15. technology management projects 16. innovative services and applications provided by advanced digital networks 17. support to help SMEs increase their research and development activities 18. Intellectual property rights management strategies
Financial Allocations
150 million euros has been earmarked for Measure 1.4, three quarters of which is to benefit the eligible area. The proportionately lower allocation to the transition areas reflects the more limited scale of opportunities. The ERDF contribution will be matched by the UK public sector.
Measure 1.4 Developing the Regional Knowledge Economy ERDF UK Public UK Private Total Cost Eligible Area 52.241 52.241 10.000 114.482 Transition Area 16.661 16.661 3.000 36.322
Outputs, Results and Impacts
Based on investment of 114.4 million euros in the eligible area and 36.3 million euros in the transition areas, it is anticipated that some 8,000 SMEs will be assisted in Measure 1.4. The average grant per SME over the lifetime of the Programme is assumed to be in the range of £10,000 to £20,000, with each £1 of support leading to an increase in sales in assisted SMEs of £10. Based on a benchmark of £85,000 to create or sustain one FTE jobs, the Measure will support 12,700 gross jobs, of which three quarters will be new jobs and the remaining 25% will be safeguarded. Medium levels of deadweight (20%) and displacement (30%), as well a regional multiplier of 1.2, have been applied to covert gross to net.
39 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Measure 1.4 Quantified Targets Fully Eligible Transition Total Anticipated Total Spend (Meuro) 114.482 36.322 150.804 EU Support (Meuro) 52.241 16.661 68.902 Fields of Intervention 162 Environmentally friendly technologies, clean and economical energy technologies 163 Business advisory services 164 Shared business services 181 Research projects based in universities and research institutes 182 Innovation and Technology Transfer 183 RTDI Infrastructure Outputs SMEs assisted 6,000 2,160 8,160 SMEs implementing new processes, 2,000 720 2,720 ways of working Results New jobs created 7,000 2,557 9,557 Jobs safeguarded 2,333 813 3,146 Increased sales (£m) 630 239 869 Sales safeguarded (£m) 210 77 287 Impacts Net additional jobs 4,704 1,754 6,458 Net jobs safeguarded 1,568 561 2,129 Net additional value added (£m) 141.1 53.1 194.2 Net value added safeguarded (£m) 47.1 17.1 64.2
Selection Criteria
The appraisal and selection criteria will take into account:
1. Focus on priority sectors 2. Extent to which support is channelled directly to the SME 3. Integration with the academic and knowledge base of the region
Final Beneficiaries
Higher and further education, North West Development Agency, Small Business Service and SBS contractors, enterprise and development agencies and other intermediary bodies assisting SMEs, local authorities
40 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
MEASURE 1.5: INVESTMENT IN PREMISES FOR NEW AND EXPANDING SMEs
Introduction
This Measure aims to increase the competitiveness of the Objective 2 region by providing high quality premises for growth-oriented business start-ups and SMEs. The primary concern is to attract and retain within the region the most entrepreneurial businesses by stimulating the market for specialist business accommodation such as managed workspaces, incubator units, business centres, science parks and technology parks.
Interventions will address the shortfall in the availability of high quality sites and premises as described in Chapter 2.
The Measure will meet the Programme objectives by attracting private and public investment into development opportunities that will generate new jobs and income. By targeting businesses in growth industries, particularly those in high technology and knowledge-intensive sectors, the projects supported will have a long-term sustainable impact on the Objective 2 economy. A further outcome will be the creation in local areas of new high growth business clusters, will contribute significantly to the accumulation of knowledge-based assets in the region.
Regional Situation
Lack of adequate accommodation for new businesses and for expansion by established SMEs continues to act as a major constraint on business growth. The situation varies considerably across the Objective 2 area: in some areas there is significant over-capacity, whereas in others, particularly the rural areas, good standard business accommodation is limited in supply and acts as a brake on the development of business and the diversification of the region. As evidenced by numerous TEC and local authority19, the problem has been found to be particularly acute for starter up and medium-sized units (1-2000 sq.ft) for new and micro businesses and for expanding businesses in rural areas.
A 1998 review of property in rural Cumbria carried out by independent consultants noted that “private sector speculative activity has been extremely weak” and that there was evidence of “latent demand”. The report also concluded that market rentals of £4.50 per square foot to be considered viable for the private sector to invest, while local companies were unable or unwilling to pay more than £2.50 per square foot. It also noted that “if existing business are to be attracted to new workspace schemes, the rent/lease terms must be sufficiently attractive to warrant the risk that is attached to the process of relocation” The survey conclude that the prospect of the market being able to bear rents capable of securing a commercial return is unlikely: “this prospect remains a distant one; so too does the likelihood of private sector development without significant public sector subsidy”
Notwithstanding the market pressures in the region, there are numerous examples of successful high quality premises developments in the region, many supported by previous Structural Funds programmes. Examples include the regional networks of Technology Management Centres and Business Innovation Centres, high technology incubator units such as the Saturn Centre in Blackburn, and university spin-out incubators such as Campus Ventures in Manchester. In the rural area, successful
19 See in Local Economic Assessments produced by North West TECs.
41 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
examples of rural workspace projects include Blencartha Business Centre, near Keswick in Cumbria, Alston Workshps in the North Pennines and Kirkby Thore in the Eden Valley.
Rationale for Intervention
Specialist business accommodation in the form of business incubators, science parks and technology parks is a key element to providing new and expanding SMEs with the foundation support for growth. Studies conducted in the UK and Europe have found that high quality business premises combined with other forms of business support and expertise have had a positive impact on businesses in terms of both their survival and growth rates and their capacity to create new jobs10.
As independent research has highlighted, there is a significant market failure in the rural and peripheral areas in the region, with a continued need for intervention to ensure an adequate supply of premises to allow growth SMEs to expand and to support new SMEs in the crucial early years.
For new and micro enterprises in particular, serviced premises help to overcome obstacles to the development of the business, including those relating to finance, at the most critical stages. Another significant benefit is the opportunity to connect with other growth businesses either in the same or different fields. There is also an opportunity to provide premises for SME services, such as training centres providing services to SMEs. The provision of such centres will be help to accelerate the growth of small businesses and also contribute to improving the survival rate.
Preferences will given to projects which help reduce the region’s environmental deficit. Additionally, projects located in close proximity to communities identified in Priority 2 will be considered favourably.
This measure will also encourage and support closer links between the development of premises and innovation and R&D services in the region, especially through incubator facilities linked to HEIs and related business networks, targeted at high growth end users.
Measure Level Objective
The objective of Measure 1.5 is:
To increase provision of specialist business accommodation to help tackle small pockets of brownfield land/buildings within areas of high unemployment, and to address the special accommodation needs of rural areas.
Indicative Actions
Actions under this Measure will be closely integrated with, in particular Measures 1.1, 1.2 and 1.4 and will closely complement the activities supported under Priority 3.
1. starter units and managed workspaces 2. specialist SME accommodation on science and technology parks 3. business incubator units 4. centres of manufacturing excellence 5. the development of intelligent buildings and links to advance ICT networks 6. refurbishment of derelict buildings and premises
42 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
7. new/improved facilities for SME training and development 8. technology transfer facilities 9. feasibility and research studies, demand and supply reviews
Financial Allocations
82.7 million euros of ERDF has been earmarked for Measure 1.5, 70% of which will be devoted to projects benefiting the eligible area. ERDF funding will be matched by the UK public sector.
Measure 1.5 Investment in Premises ERDF UK Public UK Private Total Cost Eligible Area 58.047 58.047 16.098 132.192 Transition Area 27.769 27.769 10.000 65.538
Outputs, Results and Impacts
Based on total investment of 132 million euros in the eligible area and 65 million euros in the transition area, it is expected that the Measure will support the provision of more than 200,000m2 of premises. This assumes an average cost of £650-700 per m2 of space. Each 30m2 of space is assumed to accommodate one job, which based on an average occupancy rate of 90%, derives a jobs accommodated target of 6,100.
Medium levels of deadweight (40%) and displacement (30%), as well as a regional multiplier of 1.2, have been applied to covert gross employment effects into net impacts.
Measure 1.5 Quantified Targets Fully Eligible Transition Total Anticipated Total Spend (Meuro) 132.192 65.038 197.230 EU Support (Meuro) 58.047 27.769 85.816 Fields of Intervention 161 Investing in physical capital 164 Shared business services 183 RTDI infrastructure Outputs m2 of premises provided 137,000 67,130 204,130 of which refurbished premises (m2) 54,800 27,000 81,800 Feasibility/ research studies supported 40 20 60 Results New jobs created (accommodated) 1,638 799 2,429 Jobs safeguarded (accommodated) 2,457 1,203 3,660 Increased sales (£m) 131 64 195 Sales safeguarded (£m) 197 97 294 % of accommodation occupied by 2 90 90 90 years following completion Impacts Net additional jobs 825 404 1,229 Net jobs safeguarded 1,238 607 1,845 Net additional value added (£m) 24.7 12.1 36.8 Net value added safeguarded (£m) 37.1 18.2 55.3
43 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
Selection Criteria
The appraisal and selection criteria will take into account:
1. Suitability of provision for priority growth sectors 2. Quality of selection procedures for tenants 3. Arrangements to facilitate progression of tenants to other premises
Final Beneficiaries
North West Development Agency, local authorities, enterprise and development agencies and other intermediaries assisting SMEs, the private sector, further and higher education institutes, voluntary sector.
44 Strategic Priorities Priority 1 : Business and Ideas ______North West of England Objective 2 Programme Complement ______
2.2 PRIORITY TWO : PEOPLE AND COMMUNITIES
Introduction
The People and Communities Priority seeks to promote social and economic integration and improved living and working conditions for people belonging to low- income, discriminated and other excluded groups across the North West Objective 2 Programme Area. It will focus on those groups and communities at particular disadvantage and who suffer from economic and social exclusion. The problems of these groups/communities cannot be resolved by policies that focus on economic development alone, although the interventions proposed will have a significant long- term effect on overall economic performance,
‘By developing integrated strategies and projects the gap between the most disadvantaged communities and individuals and the rest of the North West can be closed20’
Action must integrate into the wider social, economic and physical fabric of the region. The People and Communities Priority will link to other Priorities in the Programme to ensure that the most disadvantaged communities in the programme area receive the maximum benefits of Structural Fund support.
The proposals reflect key EU, UK and regional policies concerning employment growth and social inclusion activity. Priority will be given to eligible activities which add value to SRB, Neighbourhood Renewal Fund, New Deal and other regeneration activities.
The Regional Position
The North West Objective 2 Area suffers from a number of specific problems resulting in economic and social exclusion for a significant percentage of the population as evidenced in Chapter 6. These are:
Low Level of Economic Activity: a significant proportion of the Objective 2 population is characterised by lower levels of economic activity than either regional or national averages, with a larger proportion of the population economically inactive, e.g. young and older long term unemployed. This has resulted in low wealth creation and retention, exacerbated by low wages, part time and seasonal employment across fully Eligible and Transitional Areas.
High Unemployment: although the North West, on average, is close to national unemployment levels, unemployment is higher in the Objective 2 area and there are a significant number of unemployment hotspots. There is also lower employment growth, than the national average, in the fully eligible area. Recent reductions in the Claimant Count have shown a trend of ex claimants moving to other benefits rather than employment or training resulting in 'hidden' joblessness.
Low Skill Levels: the skill levels of unemployed individuals in the North West are significantly below those of the employed, with an additional disparity between those in low skill and high skill employment. Taken with the trend towards job growth in high skilled areas this will increase the existing differential between the skilled and unskilled, employed and unemployed. The significant number of those with no or only basic skills are at risk of being excluded from any future developments in the
20 North West Social Inclusion Commitment, Voluntary Sector North West, 1999
45 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
regional economy and being unable to benefit from the support provided by Structural Funds. This is a particularly acute problem as a lower proportion of the population enter further education and training than in the rest of the Country.
Lack of access to benefits of the Information Society: advances in information and communication technology are such that there is fast becoming a divide between those with and without access to the resulting benefits. This will compound social and economic exclusion, as the benefits will be disproportionately enjoyed by those who adopt then early21. However, the benefits of these advances will be able to contribute to those factors affecting economic and social exclusion itself.
Dereliction of land and poor Environmental quality: the physical environment is a key factor in economic and social exclusion. The North West has 20% of the derelict land in England, the largest of any region, which represents a significant part of the Objective 2 and Transitional Areas. As well as urban blight and industrial dereliction, rural areas are subject to environmental issues, particularly caused by structural changes, physical isolation and economic change.
Multiple Deprivation: in addition to the above, many communities are characterised by poor health, poor quality of life, poor services and a lack of other opportunities. Using the current Index of Multiple Deprivation over 30% of the population of the North West Objective 2 Programme Area (including Transitional) live in the worst 10% of wards in England. This adds to existing exclusion factors and contributes to a lack of community capacity to engage in regeneration and provide a stable environment for economic growth.
The very nature of the Objective 2 Area means that these problems vary in extent, intensity and range and occur both in fully Eligible and Transitional populations.
Review of Previous Experience
Previous evaluations and recent experience have shown the need for a Priority focusing on economic and social exclusion and highlighted particular problems:
· Problems with the administration of locally based Plans and support for inclusive partnerships; · Perceived lack of linkage between CED type activity and other priorities within an SPD, particularly between CED type training and job creation activity in other Priorities; · Low take up of ESF funds and lack of integration with ERDF activity; · Relatively short length of Previous programmes has not allowed for the development of partnerships and local activities, particularly as the level of participation can vary across the programme area(s) and programme period; · Need to match resources with need more accurately; and · Dislocation between types of activity in different Priorities.
The following positive aspects of the previous programme have also been highlighted:
· The concentration of resources and specific targeting to achieve greater overall results;
21 Closing the Digital Divide, Policy Action Team 15, March 2000
46 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
· Use of local Action/Implementation Plans to set a strategic framework for activity and develop integration between funds and activity; and · The importance of locally based partnerships to control and manage resources.
Rationale for Intervention
The rationale for this Priority is based upon the fact that economic and social exclusion is a feature of a large part of the Objective 2 Programme Area and has a detrimental effect on the overall economic performance of the region and the individuals and communities affected. Additionally, it will act as barrier to benefits provided by other types of Structural Fund intervention.
The SWOT identifies a number of areas of weakness in the Programme Area including:
· Underemployment and different employment patterns e.g. part time, seasonal employment; · Local dependence on particular sectors/firms/industries; · Lack of opportunity to access employment and skills; · Culture of low aspirations and attainment
Policies are required to confront issues of social distress, environmental degradation, crime, health and economic decline. The Priority recognises that quality of life is not only the key goal of economic activity, but also an important determinant of economic performance22. In order for interventions to be effective there is a requirement for multi-sectoral policies to be the main mechanism for implementation.
There are also a range of issues to be addressed that present particular challenges for the delivery of services. These include sparcity of population and isolation, which make geographically targeted activity problematic and small scale of projects with low numbers participating.
Key Themes
Progression
It is recognised that some of the activity within this Priority may take time to impact on the regional economy. The nature of the most deprived communities in the region is such that they are starting from a much lower base, in terms of economic activity, skills, environment and overall community sustainability, than national and regional averages. A key principle in framing this Priority, and measuring its success, will be the long term progression of communities, individuals and enterprises on a pathway that leads to economic sustainability and growth, as well as social integration. As such activity to tackle wider social inclusion issues, and create a stable environment for economic growth, is integral to the programme.
In addition, it should be recognised that although much activity will be at a lower level than the skills required by growth sector employment, there will be a need for other types of employment, including opportunities created through social and community enterprise.
22 UK Competitiveness Indicators 1999
47 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
Partnership
Actions within this priority will be developed and delivered through appropriate partnerships which bring together local people and strategic bodies; public, private and voluntary sectors. Activities will form part of an overall strategic plan for renewal and will build upon existing, and develop new, partnerships as appropriate. These partnerships are likely to be at varying levels of development, which will vary throughout the programme period and over the Programme Area. The allocation of resources to partnerships will be based upon opportunity as well as need and take into account the capacity of partnerships to deliver. These factors will vary across the length of the programme and will be reviewed on a regular basis to ensure an equitable distribution of resources.
The involvement in and control of partnerships by communities will be key ingredient to meaningful strategies and activity. Strategic Management and delivery will also reflect multi agency involvement based upon local control.
Integration
Partnerships will need to draw on a range of resources to deliver strategic plans. Actions within this priority will need to be integrated with actions through Objective 3, European and national initiatives such as New Deal, Small Business Service, Learning and Skills Councils, Health Action Zones, Employment Action Zones, Sport Action Zones, Community Initiatives and the Single Regeneration Budget. Where appropriate partnerships for the delivery of Objective 2 resources should build on/augment existing partnership structures. This will ensure integration and strategic planing to ensure all resources are effectively utilised in a manner appropriate to the needs of target group/communities.
Measures in this Priority need to integrate with activity within other Priorities, particularly those focused around support for employment growth and strategic developments. Measures 2.2 and the Objective 3 Programme will provide support for excluded communities to access employment and other opportunities provided by Priorities 1 and 3. Employment Access Plans, in Priority 3, will connect excluded communities to opportunities in Employment Development Zones. This will be supported by the use of Scoring Criteria in both Priorities 1 & 3.
The priority will be implemented through agreed local plans unless otherwise agreed by the PMC. Each plan will include:
· a strong partnership to define challenges, strategy, priorities, resource allocation and to implement, monitor and evaluate the strategy. Partnerships should include economic and social partners, NGOs and resident groupings. These partnerships will be decentralised, effective and broad based and take ownership of the initiative from inception through to completion; · the linkage of a strategic plan for the area in question to the economic, and physical network of the wider area, including between local partnerships and agents responsible for the social and economic of the wider region/ sub-region; · an implementation mechanism that is either an Action Plan or Local Implementation Plan; · a planned timetable for implementation and commitment of expenditure; and · identified sponsors and financial support for key elements of the proposed activities at the outset of the investment programme.
Opportunities
48 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
The key opportunity will be to address the negative economic and social factors affecting the Programme Area, and resulting exclusion, by supporting excluded groups and communities in developing local enterprise, employment, skills and community capacity. The economic evaluation of the programme area indicates that the development of local enterprises and services in the community/social sector will provide opportunities for employment growth relevant and accessible to needs and skills.
Objective 3
Objective 3 will be key additional element in the effectiveness of Objective 2 and, in particular, the aims of this Priority. Objective 3 will address specific training and capacity building needs based upon regional requirements as identified in the Regional Development Plan. The use of Objective 3 resources in the Objective 2 area will be agreed and managed by Objective 2 partnerships to ensure complementary and avoid duplication of activity.
The Objective 3 RDP for the North West has allocated substantial resources for the promotion of Equal Opportunities and addressing Social Exclusion. Measure 2 of the relevant priority specifically identifies the difficulties facing the most disadvantaged communities and neighbourhoods. This emphasis on the spatial nature of disadvantage coincides with the rationale for this Priority.
Other Objective 3 support also focuses on the target groups identified for this Priority. This reflects the tendency for many individuals to be affected by a number of factors which impact on access to learning and employment, and for many of these individuals to live in the most disadvantaged neighbourhoods.
Targeting
Resources within this Priority will be targeted towards greatest need. This will result in actions within geographically identified communities defined on the basis of a map. The requirement for both local delivery and strategic actions indicates that geographic targeting alone will be insufficient, particularly as deprivation often occurs in discrete areas not identified by usual methodologies and is not always geographically concentrated. In particular, the extent and density of deprivation /exclusion can be overlooked by any methodology concentrating purely on the degree of deprivation /exclusion23. Activity targeted at geographically diverse communities of interest will be undertaken through the North West Objective 3 Programme.
· Resources will be targeted through the use of criteria to identify need, the opportunity to address it and its relationship to the aims of the Priority and Measures. This will combine the identification of socially excluded groups with factors causing exclusion.
Recognising that resources will need to be focussed on that part of the population most in need, regional partners, in accordance with Commission guidance, have identified an overall population coverage of 35% of the Fully Eligible and Transitional
23 Social and Economic Exclusion through Regional Development: The Community Economic Development Priority in European Structural Fund Programmes in Great Britain (European Commission)
49 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
Areas, to be reduced to 30% by 2003 (subject to mid-term Programme review). This coverage is comprised of:
· Core Population (funded for full length of the Programme)
- Most Deprived Population in the Fully Eligible Area (based upon national comparisons in the Index of Multiple Deprivation 2000);
- Most Deprived Rural Population (maximum 1% of the Population of the Fully Eligible and Transitional Areas).
· Exit Population (funded until 2003)
- Population of existing Community Economic Development Wards (from the 1997-99 Objective 2 programmes) in the Fully Eligible Area not falling within the Core Population;
- Population of existing Community Economic Development Wards (from the 1997-99 Objective 2 programmes) in the Transitional Area.
The regional partnership feels that work on-going in areas falling outside the Core Population should be supported to exit the communities involved, as part of a managed process, from CED funding. This will be undertaken via Exit Strategies to be completed by 31st December 2003.
Due to the length of the Programme, it will be necessary to change the focus of resources within Priority 2 as circumstances change. This will be done on the basis of the set of principles set out above. In the first instance, these principles will be applied in the following way:
· Core Population (funded for full length of the Programme)
- Most Deprived Population in the Fully Eligible Area based on worst 8% on the Index of Multiple Deprivation 2000;
- Most deprived rural population based on the Index of Multiple Deprivation applied to rural areas (as defined by Rural Priority Area designation) and the Access Domain of the Index of Multiple Deprivation 2000 as a secondary indicator, where appropriate.
· Exit Population (funded until 2003)
- Population of existing Community Economic Development Wards (from the 1997-99 Objective 2 programmes) in the Fully Eligible Area not falling within the Core Population;
- Population of existing Community Economic Development Wards (from the 1997-99 Objective 2 programmes) in the Transitional Area.
A list of targeted Wards and associated populations, reflecting these criteria are given in Annex A.
In addition, recognising that deprived communities do not always fall in discreet ‘pockets’, there will also be targeting flexibility. This will be subject to an initial proviso that:
50 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
· This does not increase the overall population coverage; · At least 60% of the original population remains targeted; and · The communities subject to this arrangement are adjacent and contiguous.
Priority Objective
The previous chapter the outlined that the aim of the 2000 – 2006 North West Objective 2 Programme would be:
To develop a competitive and sustainable economy which offers employment and income opportunities for people of all ages, abilities and gender
Three strategic objectives were identified that would deliver this programme. Whilst all three strategic objectives will be supported through investment made under this priority the key strategic objective highlighted in Chapter 8 that will be delivered will be:
To empower and enable socially and economically excluded individuals to access income and employment opportunities that reflects their aspirations and circumstances
Within the North West Objective 2 Programme Area Chapter 2 highlighted key issues of a low level of economic activity, high unemployment, low skill levels, a lack of access to benefits of the Information Society; and a poor physical environment. These issues tend to be spatially concentrated within the programme area.
Against this background the following Priority Objective has been agreed:
To create local employment and enterprise opportunities, remove barriers to participation and progression, improve employability and to increase participation in the labour market, build the capacity and cohesiveness of groups and communities and improve the local physical environment
To deliver this priority objective the following Measures have been developed;
2.1 Developing Enterprise and Employment in Communities (ERDF) 2.2 Improving Access to Employment (ERDF) 2.3 Developing an Inclusive Information Society (ERDF) 2.4 Connecting Communities (ERDF) 2.5 Building Economically Sustainable Communities (ERDF)
Investing Priority Two Resources within the Objective 2 Transitional Area
Investment within the Objective 2 Transitional Area will be used to fund Exit strategies for equivalent Priority 2 initiatives commenced between 1994 and 1999. Therefore Priority Two resources will be available within the Objective 2 Transitional area to support those areas which have had a designation under the 1994 – 1999 Objective 2 Programme as Community Economic Development target communities. The measures available will be appropriate to the needs of the individual exit strategies.
51 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
Transitional Areas Strategy
Careful consideration has been given to developing an approach for the Transition Areas which takes account of a number of factors, including:
· The nature of the Transition Areas in terms of the scale of disadvantage communities, as well as the geography of the Transition Areas (which comprise 8 distinct geographical areas, with some wards of severe disadvantage, designated as Transition, adjoining disadvantaged wards designated as Fully Eligible);
· The limited nature of Transitional funding, including the annual expenditure profile;
· The need to ensure sustainability of actions after Structural Fund support ends.
Although Transitional Areas could be considered to be less in need than Fully Eligible Areas, the criteria used to determine designation made use of a limited number of indicators. The Transitional Areas designated in the North West Objective 2 Programme include a considerable number of wards previously designated for CED support under the former GMLC Programme.
It would clearly be unfair to deprive these communities of support, as they continue to be in need even when compared to much of the Fully Eligible Area. At the same time, account has to be taken of the ending of Objective 2 support. This contradiction has been resolved by placing the emphasis on Priority 2 activities in the Transition Areas in developing and implementing exit strategies for 1997-1999 CED communities. This allows for a continuation of activity while moving to a sustainable long term strategy where EU support is no longer available. This approach ensures that funding support does not come abruptly to a halt, but that the reduction of EU support is taken into account in the package of support available.
A total of circa 10% of EU support for Transitional Areas has been allocated to Priority 2. This refects the need to ensure that the financial allocation to the Transitional Areas in relation to the targeted population coverage is no higher than the allocation per capita in the Fully Eligible Areas.
After consideration, it has been decided that all five of the measures in Priority 2 are of relevance to the Transitional Areas. This reflects the experience that the exact combination of projects required to tackle the problems of disadvantage will vary from neighbourhood to neighbourhood. In some areas, for example, difficulties of accessing employment locations will be a major issue, while in other it may be lack of local facilities. In consideration of the financial profile, however, it has been agreed to make support available for Transitional Areas under Priority 2 will run from 2000- 2003. This will avoid the situation of converting measures with exceptionally low financial support available in any individual year. A shortened timescale will avoid this problem, while allowing sufficient time for communities to develop and implement full exit strategies.
Financial Allocations
The following tables indicate the financial allocation at the Priority level, including the allocation to EU Fund, the Priority level UK Public and the private sector contributions
52 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
for both the Fully Eligible Objective 2 Area and the Transitional Objective 2 Area. The allocations presented are for the lifetime of the Programme.
Priority 2: People and Communities – Summary Financial Table (Meuros) Objective 2 Programme Area – Fully Eligible Area Total Costs EU UK Public Private Total 317.996 ERDF 158.998 158.998 0.000
Priority 2: People and Communities – Summary Financial Table (Meuros) Objective 2 Programme Area – Transitional Area Total Costs EU UK Public Private Total 31.738 ERDF 15.869 15.869 0.000
A total of 349.734 million euros have been allocated to Priority 2, of which 317.996 million euros, or 91%, are for people and communities in the eligible areas, the remainder of which are for transition areas. 50% of the total resources available, some 174.867 million euros, are ERDF, matched with a similar level of UK Public resources. No private sector contributions are allocated, on the basis that the private sector will not participate in the areas targeted by Priority 2.
PRIORITY 2 PEOPLE AND COMMUNITIES SUMMARY FINANCIAL PROFILE ERDF UK Total UK Total Public Public Private Cost Eligible Area 158.998 158.998 317.996 - 317.996
Transition 15.869 15.869 31.738 - 31.738 Area
The financial allocations are weighted more heavily towards Measures 2.1 and 2.2, which together comprise 48% of the Priority allocation. 38.159 million euros of ERDF are allocated to each of Measures 2.1 and 2.2 in the fully eligible areas over the lifetime of the Programme, matched with a similar allocation of UK Public. The total allocations are therefore 76.318 million euros for each of these Measures.
30.209 million euros of ERDF are allocated to both Measures 2.3 and 2.4 in the eligible areas, together comprising a further 38% of the Priority total. The lowest allocation is for Measure 2.5, largely capacity building in relation to the other Measures. Nonetheless, 22.259 million euros of ERDF are allocated to this Measure in the eligible areas, 14% of the Priority total.
PRIORITY 2 PEOPLE AND COMMUNITIES FINANCIAL PROFILE (FULLY ELIGIBLE AREAS) ERDF UK Total UK Total Public Public Private Cost 2.1 Enterprise & 38.159 38.159 76.318 - 76.318
53 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
Employment in Communities 2.2 Access to Employment 38.159 38.159 76.318 - 76.318 2.3 Inclusive Information Society 30.210 30.210 60.420 - 60.420 2.4 Connecting Communities 30.210 30.210 60.420 - 60.420 2.5 Sustainable Communities 22.260 22.260 44.520 - 44.520 P2 TOTAL 158.998 158.998 317.996 - 317.996
The profile of the ERDF allocation over the course of the Programme indicates a decreasing allocation from the largest yearly allocation in 2000 until 2004, with a slight increase in yearly allocations for 2005 and 2006 in preparation of the end of the Programme. This profile is consistent across each of the 5 Measures.
54 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
PRIORITY 2 PEOPLE AND COMMUNITIES: ERDF ALLOCATION BY YEAR (ELIGIBLE AREAS) 2000 2001 2002 2003 2004 2005 2006 2.1 Ent & Employment 8.695 6.504 4.776 4.613 4.075 4.425 5.071 2.2 Access to Empl. 8.695 6.504 4.776 4.613 4.075 4.425 5.071 2.3 Information Soc 6.883 5.149 3.781 3.652 3.226 3.504 4.015 2.4 Connecting Comm. 6.884 5.150 3.781 3.652 3.226 3.503 4.014 2.5 Sustainable Comm. 5.072 3.794 2.786 2.691 2.378 2.581 2.958 TOTAL 36.229 27.101 19.900 19.221 16.980 18.438 21.129
9% of the total Priority resources are allocated to the transition areas reflecting the fact that the majority of the target population is located in areas with full eligibility. Nonetheless, there are pockets of greater disadvantage in the transition areas and so 31.737 million euros is made available to complete their ‘transition’ to greater social and economic integration. As with the fully eligible areas Measure breakdown, greater emphasis is placed on the Enterprise and Employment and Access to Employment Measures, together comprising 48% of the Priority total.
PRIORITY 2 PEOPLE AND COMMUNITIES FINANCIAL PROFILE (TRANSITION AREAS) ERDF UK Total UK Total Public Public Private Cost 2.1 Enterprise and Employment in Communities 3.808 3.808 7.616 - 7.616 2.2 Access to Employment 3.808 3.808 7.616 - 7.616 2.3 Inclusive Information Society 3.015 3.015 6.030 - 6.030 2.4 Connecting Communities 3.015 3.015 6.030 - 6.030 2.5 Sustainable Communities 2.223 2.223 4.446 - 4.446 TOTAL 15.869 15.869 31.738 - 31.738
The profile of the yearly allocation to the transition areas reflects that these areas do not demonstrate disadvantage on the scale of the fully eligible areas with the fact that the transition areas already possess a degree of social and economic integration. Consequently, ERDF allocations cease in 2003, by which time it is anticipated that the transition areas have completed their process to integration.
55 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
PRIORITY 2 PEOPLE AND COMMUNITIES: ERDF ALLOCATION BY YEAR (TRANSITION AREAS) 2000 2001 2002 2003 2004 2005 2.1 Ent & - - Employment 1.264 1.231 0.747 0.567 2.2 Access to Empl. 1.264 1.231 0.747 0.567 - - 2.3 Information Soc 1.000 0.975 0.591 0.449 - - 2.4 Connecting - - Comm. 1.000 0.975 0.591 0.449 2.5 Sustainable - - Comm. 0.737 0.721 0.436 0.329 Total 5.265 5.131 3.112 2.361
Outputs and Targets
The quantified targets for Priority 2 outlined below have been developed taking account of guidance from the European Commission, as well as previous experience in similar activities within the North West. The Priority-level targets comprise core measures of performance incorporating sales, employment and value added. Guidance will be provided to project sponsors on appropriate methods of estimating such effects. Nonetheless, it is recognised that a range of other benefits will accrue from the projects supported by the Priority and these benefits will also be analysed in the Annual Report.
The Priority will offer learning support to a significant number of residents in the targeted areas, some 16,650 persons over the lifetime of the project. Further, 3,330 residents will be given more substantive assistance in order to significantly assist them towards employment. There are targets for the number of community enterprises either established or assisted, 194 of each. Establishing community enterprises will also generate and sustain employment. A total of 1,100 locally based micro enterprises will also be assisted. It is anticipated that the Priority will also offer support to 2,220 new enterprises or persons in employment.
There is a focus on ICT, through Measure 2.3, where 33 local learning and 33 ICT initiatives will be supported, and a focus on assisting community organisations to help themselves and their communities by increasing their capacity to solve problems, establish and enter partnerships and to increase involvement.
Priority level results include 21,000 people with enhanced Information Society skills, 2,600 new jobs in community and micro enterprises, 9,5000 people given learning and employment support securing employment and £160m of new investment as a result of environmental improvements and the promotion and marketing of targeted areas.
Clearly the success of the Priority depends on its ability to sustain lasting benefits for the targeted residents and the communities. A target of 11,550 persons in employment two years following the end of support has been established, with four of the five measure directly contributing to this figure.
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PRIORITY 2 QUANTIFIED TARGETS Fully Transition Total Eligible Outputs No. of community enterprises assisted 175 19 194 No. of new community enterprises 175 19 194 established Number of micro enterprises supported 1,000 100 1,100 Number of people supported with self 2,000 200 2,200 employment No. of people assisted towards employment 3,000 300 3,300 No. of people provided with learning 15,000 1,500 16,500 support No. of community organisations provided 500 50 550 with capacity building support Number of employment and learning 30 3 33 centres established Community ICT facilities established 30 3 33 Results People (residents) with improved IS skills 21,000 2,100 23,100 Number of people (residents) securing 1,470 147 1,617 employment New jobs in micro and community 2,600 260 2,860 enterprises Number of employment/learning 9,500 950 10,250 beneficiaries securing a positive outcome New investment secured for target areas £160m £16m £176m Impacts People (residents)in employment two years 11,550 1,155 12,705 after support has ended Jobs surviving in micro and community 1,800 180 1,980 enterprises (2 years)
57 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
Achievement of the targets will be assessed in the context of the following baselines:
TABLE 9.3.4 PRIORITY 2 KEY BASELINE DATA Value Year Source Number of employed people in targeted 1997 AES areas1 tbc Number of residents in targeted areas in 1997 AES employment1 tbc Number of residents form targeted areas 2000 NOMIS unemployed (ILO)1 tbc Number of residents form targeted areas 2000 NOMIS unemployed for more than 2 years (ILO)1 tbc Number of wards in worst 10% of IMD tbc 2001 IMD Number of active community groups in targeted areas1 tbc Note 1: Targets to be agreed when target areas have been confirmed Note 2:Programme level targets for the Cross Cutting Priorities of Equal Opportunities, ICT and Sustainable development are detailed in Chapter 10.
Each of the Programme baselines will be updated annually and detailed in the Annual Report.
Appraisal and Selection Criteria
A comprehensive guide to the appraisal process and scoring system, and a complete breakdown of the selection criteria are published as a separate Annex. This Annex includes a detailed guide to the stages involved in the appraisal process as well as a definition of each of the selection criteria at Programme, Priority and measure level.
As a minimum however the Priority Level selection criteria will take into account:
- Contribution to Priority objectives - Scale of benefits to the target communities - Involvement of the community - Strategic fit with the Objective 3 RDP
Cross Cutting Themes - People and Communities
The North West Objective 2 SPD has three cross cutting themes – Equal Opportunities, the Information Society and the Sustainable Development. Although these cross cutting themes have not been allocated separate sums of monies, the three “vertical” Priorities will make important contributions to the objective of each theme. The full details of each theme are presented in a later section of the Complement.
The People and Communities Priority is focussed on the most disadvantaged communities within the North West. Within many of these communities, women are additionally disadvantaged. The target areas have high proportions of lone parent and low-income families, with limited access to childcare facilities, effectively isolating many women from training and employment opportunities. All of the measures in this Priority have a contribution to make in assisting women to access opportunities. These opportunities relate not only to employment, but also to micro enterprise and community enterprises. The key to making a contribution to the Equal Opportunity objective is dependent on ensuring that a high proportion of beneficiaries are women.
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The Equal Opportunity targets for Priority 2 are detailed below:
Priority 2 People and Communities Quantified Targets Fully Eligible Transition Total Outputs Total EO Total EO Total EO Number of people supported with 2,000 800 200 80 2,200 880 self employment No. of people assisted towards 3,000 1,500 300 150 3,300 1,650 employment No. of people provided with 15,000 7,500 1,500 750 16,500 8,250 learning support Results People (residents) with improved 21,000 10,500 2,100 1,050 23,100 11,650 IS skills Number of people (residents) 1,470 735 147 73 1,617 808 securing employment New jobs in micro and community 2,600 1,300 260 130 2,860 1,430 enterprises No. of employment/learning 9,500 4,750 950 475 10,250 5,125 beneficiaries securing a positive outcome
The Information Society is having a major effect on the every day lives of ordinary people. Its effects are not limited to businesses, and there is a need to ensure that the most disadvantaged groups in society have access to these benefits. The People and Communities has a dedicated Information Society measure which will help put in place community and neighbourhood based infrastructure which will allow local access. As important, however, is the support available to allow people to take up services and opportunities based on ICT.
The Information Society targets for Priority 2 are detailed below:
Priority 2 People & Communities: Information Society Quantified Output Targets Measure Target ICT related community enterprises 2.1 75 People into self employment (ICT related) 300 No. of projects assisted using ICT to support the 2.1 80 development of community based employment opportunities No. of projects using ICT to improve access to 2.2 80 employment No. of projects using ICT to support a cross-measure 2.3 200 approach to addressing social exclusion
Sustainable Development principles are as important in the most disadvantaged neighbourhoods and communities, as they are in the countryside. There is a need to improve the built environment in urban areas at the same time as training and employment initiatives are taking place. Failure to address the problems of the local environment can lead to those who are helped into employment leaving the
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neighbourhood at the earliest opportunity. There are also a number of opportunities arising from sustainable development which can benefit both the individual and the community. These include social economy and community enterprise activities, particularly where linked to activities such as re-cycling.
The Sustainable Development targets for Priority 2 are detailed below:
Priority 2 People & Communities Sustainability Quantified Targets Measure Target Encouragement of businesses to engage in local self- 2.1 300 sufficiency e.g. recycling Development of local supply chains, “buy local” 2.1 20 schemes and local economic trading schemes Employment support to individuals linked to the 2.2 1,500 provision of goods and services that are needed in the local community. Provision of ICTs to facilitate distance learning and 2.3 33 home working, reducing the need to travel Facilitate community participation in maintaining their 2.4 150 local environment Projects re-using redundant buildings and derelict land 2.4 100 Develop community devised and implemented 2.5 90 solutions to local problems
60 Strategic Priorities Priority 2 : People and Communities ______North West of England Objective 2 Programme Complement ______
MEASURE 2.1: DEVELOPING ENTERPRISE AND EMPLOYMENT IN COMMUNITIES (ERDF)
Background and Rationale
This measure will provide support for the stimulation, creation and support of community business, enterprise and employment within and for excluded communities.
A low level of economic activity within excluded communities, resulting poor retention of wealth, is an increasing trend in the North West, with a reducing percentage of the working age population economically active as compared to the GB average. This trend is likely to continue to increase as employment opportunities become more high skilled and less readily accessible for excluded groups. Levels of self employment vary across the region but are falling as a percentage of overall employment both nationally and regional. Low income is indicated by the relatively high level of Income Support recipients.
This Measure will promote locally based responses to economic exclusion and marginalisation from the labour market, including low wages and seasonal employment. It will promote the provision of local activities within the social economy and employment, which ultimately contribute to the socio-economic sustainability of communities. It will support/complement activity carried out under Policy Fields 1 (Active Labour Market), 2 (Equal Opportunities and Social Inclusion) and 4 (Adaptability and Entrepreneurship) of the Objective 3 Programme.
Measure Objective
The objective of Measure 2.1 is:
To raise the level of sustainable employment and economic activity, of excluded communities and develop the ability of communities to create and retain wealth
Eligible Activities
Measure 2.1 will support both capital and revenue activities.
1. Support for the establishment, sustainability and competitiveness of community enterprises, social economy, local micro businesses with a particular focus on those contributing to wider social inclusion and providing value added services to target groups/communities;
2. Promotion of self employment, and support for residents of the target area entering self employment (where it is distinct from and/or additional to Objective 3 support) providing added value services and contributing to employment and local services;
3. Creation of and support for sustainable employment for residents of the target area, including opportunities under other Priorities 1 and 2;
4. Premises that accommodate community businesses & and micro - enterprises;
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5. The provision of specialist support centres (capital and revenue) needed to promote and support enterprise development;
6. Initiatives to provide communities enterprises, micro enterprises and those residents entering self-employment with access to finance and other enterprise related support services.
7. The provision of appropriate support services, e.g. dependent care, necessary to allow residents to take up and develop enterprise and employment opportunities.
Note 1: A community enterprise or business has a number of distinguishing characteristics. The two key features are that the enterprise is either non profit making or non profit distributing (often with profits pledged back to a community, voluntary or charitable organisation) and that is not owned or controlled by individuals operating in a private capacity, but by links to one or more community, voluntary or charitable organisations.
Note 2: A micro-enterprise is defined as an enterprise with les than 5 people, located within the eligible area. Support will only be made available where it is distinct from Priority 1 support.
Financial Allocations
A total of 83.934 meuro have been allocated to the Priority, 91% of which is for the people and communities of the eligible areas reflecting the significantly larger population in these areas. In both the eligible and transition areas the allocation is split equally between ERDF and UK Public sources, with no financial allocation from the UK Private sector as a result of difficulty in attracting private sector support for Priority 2 actions in the Programme area.
MEASURE 2.1 ENTERPRISE AND EMPLOYMENT IN COMMUNITIES: FINANCIAL PROFILE ERDF UK Public UK Private Total Cost Eligible Area 38.159 38.159 - 76.318 Transition Area 3.808 3.808 - 7.616
Outputs, Results and Impacts
Measure 2.1 is the key mechanism for delivering the Priority targets for the number of community and micro enterprises assisted and the number of new community enterprises established. The Measure will also create 2,000 new enterprises/employment opportunities for local residents.
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MEASURE 2.1 QUANTIFIED TARGETS Fully Eligible Transition Total Anticipated Total Spend (meuro) 31.159 3.808 41.967 Anticipated ERDF (meuro) 76.318 7.616 83.934 Fields of Intervention 163 Business advisory services 166 Services in support of the social economy 24 Workforce flexibility, entrepreneurial activity: assistance to persons, companies 24 Workforce flexibility, entrepreneurial activity: assistance to structures and systems Outputs No. of community enterprises1 175 17 192 assisted No. of new community 175 17 192 enterprises1 established Number of micro-enterprises 1,000 100 1,100 assisted No. of people given self 2,000 200 2,200 employment support New premises (m2) 20,000 2,000 22,000 Results Number of people (residents) 1,320 132 1,320 securing employment (self employment) Sales in community and micro £130m £13m £143m enterprises New jobs in community and 2,600 260 2,860 micro-enterprises Impacts People in employment two years 800 80 880 after support has ended Jobs in community and micro 1,800 180 1,980 enterprises surviving for 2 years 1 Includes social economy organisation
Measure Selection Criteria
Measure selection criteria will take into account:
· Involvement of the community at the project development stage · Inclusiveness of the partnership · Provision of mentoring, aftercare and ongoing support · Provision of dependent care to allow beneficiaries to access services and support provided by the measure
Final Beneficiaries
Final beneficiaries will include the North West Development Agency, the Small Business Service, local authorities, central government departments and local enterprise and development agencies, community, voluntary and charitable groups.
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MEASURE 2.2: IMPROVING ACCESS TO EMPLOYMENT (ERDF)
Background and Rationale
This measure will address barriers to equality of opportunity in learning and employment for excluded communities, that prevent full access to the employment and learning markets, thereby enhancing the economic competitiveness of excluded groups.
Regional unemployment rates are comparable to the national average, with distinct differences across the Objective 2 and Transitional Areas. In particular long term unemployment is a significant factor. Recent reductions in long term unemployment reflecting the position that many ex-claimants are not entering employment or training routes. This extends the level of 'joblessness' beyond that recognised as ‘unemployed’. This is exacerbated by low wages, seasonal unemployment and isolation from learning and employment opportunities.
This Measure will support activity to enhance the ability of communities to access training and employment opportunities. This will involve the identification and removal of barriers to employment and learning. It will specifically deal with the structures or organisation of employment and training and as such will complement/support activity under Objective 3 Policy Fields 1 (Active Labour Market) and 3 (Lifelong Learning).
Measure Objective
The objective of Measure 2.2 is:
To improve access and entry to employment and learning opportunities by identifying and removing barriers to participation
Eligible Activities
Measure 2.2 will support both capital and revenue expenditure.
1. Support for research and feasibility studies to identify and address barriers to employment and learning;
2. Support for appropriate delivery mechanisms to promote employment and learning opportunities and offer support to local residents seeking to take up new opportunities;
3. Support for the creation of learning/employment centres and the adaptation of existing premises into such centres;
4. Support for awareness raising amongst employers;
5. Support for recruitment initiatives aimed at supporting employers engage local residents;
6. Appropriate support services e.g. dependent care, to promote increased and sustainable economic activity of local residents;
7. To provide employment support to individuals, including where appropriate, advice, guidance and mentoring;
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8. Support for job creation initiatives linked to securing employment for local residents of job opportunities generated by other Measures and Priorities.
Financial Allocations
A total of 83.934 meuro have been allocated to the Measure, 91% of which is for the people and communities of the eligible areas reflecting the significantly larger population in these areas. In both the eligible and transition areas the allocation is split equally between ERDF and UK Public sources, with no financial allocation from the UK Private sector as a result of difficulty in attracting private sector support for Priority 2 actions in the Programme area.
MEASURE 2.2 ACCESS TO EMPLOYMENT FINANCIAL PROFILE ERDF National National Total Cost Public Private Eligible Area 38.159 38.159 - 76.318 Transition Area 3.808 3.808 - 7.616
Outputs, Results and Impacts
The Measure will support 3,300 people towards employment and 16,500 people with learning support through the improvements in residents’ ability to access to learning and employment opportunities.
MEASURE 2.2: QUANTIFIED TARGETS Fully Transition Total Eligible Anticipated Total Spend (meuro) 76.318 7.616 83.934 Anticipated ERDF (meuro) 38.159 3.808 41.967 Fields of Intervention 166 Services in support of the social economy 21 Labour market policy: assistance to persons 21 Labour market policy: assistance to structures and systems 24 Workforce flexibility, entrepreneurial activity: assistance to persons, companies 24 Workforce flexibility, entrepreneurial activity: assistance to structures and systems
Outputs No. of people (residents) assisted 3,000 300 3,300 towards employment Number of learning/employment 30 3 33 centres No. of people provided with 15,000 1,500 16,500 learning support Results Number of people (residents) 9,500 950 10,250 securing employment Impacts People (residents) in employment 6,000 600 6,600 two years after support has ended
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Measure Selection Criteria
Measure selection criteria will take into account:
· Involvement of the community at the project development stage · Provision of mentoring, aftercare and ongoing support · Inclusiveness of partnership · Provision of dependent care to allow beneficiaries to access services and support · provided by the measure
Final beneficiaries
Final beneficiaries will include the North West Development Agency, the Small Business Service, local authorities, central government departments and local enterprise and development agencies, community, voluntary and charitable groups, further education institutes.
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MEASURE 2.3 DEVELOPING AN INCLUSIVE INFORMATION SOCIETY (ERDF)
Background and Rationale
This measure aims to develop an inclusive information society, ensuring that excluded communities become full participants in the developing digital economy and overcome the challenge of a disparity between 'information rich' and 'information poor'.
Information Technology has already had a significant impact on the international, national and regional economy and the lives of individuals. As a result of the environment that creates exclusion, excluded communities are less likely to have access to the ICTs. This reinforces disadvantage in terms of skills, employment opportunities and dislocation from the mainstream. Access to a range of basic and higher level ICTs is essential to ensure inclusion and access for individuals.
It will build on the approach taken by the report Closing the Digital Divide: Information and Communication Technology and by the work on social inclusion undertaken as part of the Inter-Regional Information Society Initiative - IRISI - which forms a key component of the Regional Information Society Strategy. It will support/complement activity carried out under Policy Fields 2 (Equal Opportunities and Social Inclusion) and 3 (Lifelong Learning) of the Objective 3 Programme.
Measure Objective
The objective of Measure 2.3 is:
To maximise the benefits to be gained from the emerging information society by improving access to new services and opportunities, and enable local communities to use innovative applications of new technologies
Eligible Activities
Measure 2.3 will support both capital and revenue expenditure.
1. Activity to build the capacity of local communities to set up and maintain facilities and services to provide access ICT services;
2. The provision of locally based IS facilities for community benefit, including he adaptation/up-grading of existing communities facilities;
3. Promoting initiatives to create opportunities for local people to develop their own web content and services, including related employment;
4. Encourage the dissemination of good practice by linking local, regional and inter-regional community networks;
5. Development of interactive public access services of direct benefit to the residents of the target area.
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Financial Allocations
66.448 million euros will be incurred by Measure 2.3 projects, 91% of which is for people and communities in the eligible areas. ERDF contributions will be matched by the UK public sector. There are no private sector contributions in view of the difficulty in attracting private sector interest in disadvantaged communities.
MEASURE 2.3 INCLUSIVE INFORMATION SOCIETY: FINANCIAL PROFILE ERDF UK Public UK Private Total Cost Eligible Area 30.209 30.209 - 60.418 Transition Area 3.015 3.015 - 6.030
Outputs, Results and Impacts
The key output of this Measure is the support offered to 70 learning and ICT initiatives, of which 64 are located in the fully eligible areas and 6 in the transition areas.
MEASURE 2.3 QUANTIFIED TARGETS Fully Eligible Transition Total Anticipated Total Spend 60.418 6.030 66.448 (meuro) Anticipated ERDF (meuro) 30.209 3.015 33.224 Fields of Intervention 322 Information and Communication Technology 323 Services and applications for the citizen 324 Services and applications for SMEs
Outputs Communities supported 200 20 220 with capacity building initiatives Good practice networks 6 1 7 Community ICT facilities 30 3 33 Web content, development 40 4 4 and maintenance project Results People (residents) with IS 21,000 2,100 23,100 skills People (residents) 200,000 20,000 220,000 benefiting form IS delivered information Impacts Residents securing 4,000 400 4,400 employment
Measure Selection Criteria
Measure selection criteria will take into account:
§ Community involvement at the project development stage
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§ Provision of mentoring, aftercare and ongoing support § Provision of dependent care to allow beneficiaries to access services and support provided by the measure § Inclusiveness of partnership
Final beneficiaries
Final beneficiaries will include the North West Development Agency, the Small Business Service, local authorities, central government departments and local enterprise and development agencies, community, voluntary and charitable groups.
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MEASURE 2.4: CONNECTING COMMUNITIES (ERDF)
Background and Rationale
This Measure will support activity to address environmental degradation affecting excluded communities, through regenerating specific areas of dereliction and poor environment that detract from the quality of life and adversely affect economic performance.
A significant part of the North West can be characterised as having deteriorating and low quality environment. It often located near or within excluded communities and is not geographically concentrated. It is seen as a distinct disincentive to investment and an exclusion factor in terms of the negative image it promotes and detrimental effect it has on employment, health and crime levels.
Environmental degradation has 3 main impacts on disadvantaged communities; it acts as a disincentive to investment and growth, it inhibits access to workplaces and services, and it compounds other socio-economic problems such as crime and lack of opportunity.
This Priority will address these by supporting local partnership led activity to enhance and sustain the local environment, particularly with regard to the development of environmental assets and the dereliction that surrounds many excluded communities. It will address the environment aspects of exclusion in order to improve the attraction of areas for investment, as well as existing and new employment sites. It will support/complement activity carried out under Policy Fields 1 (Active Labour Market) and 2 (Equal Opportunities and Social Inclusion) of the Objective 3 Programme.
Measure Objective
The objective of Measure 2.4 is:
To develop and protect the quality of the environment in order to improve the attraction of areas for investment and growth, and connect disadvantaged communities to areas of opportunity
Eligible Activities
Measure 2.4 will support both capital and revenue expenditure.
1. Environmental improvements which develop, improve and sustain the quality and appearance of the built and natural environment;
2. Environmental improvements which enhance access to work and training opportunities and services;
3. Environmental action to tackle wider exclusion by increasing security, particularly where this relates to local economic development opportunities;
4. Support for local partnerships and projects to participate in activity to improve the image, physical environment, reduce pollution and develop natural landscapes;
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55... Local marketing and promotional initiatives designed to secure new investment in the targeted area as a consequence of environmental and other improvements.
Financial Allocations
66.448 million euros will be incurred by Measure 2.3 projects, 91% of which is for people and communities in the eligible areas. ERDF contributions will be matched by the UK public sector. There are no private sector contributions in view of the difficulty in attracting private sector interest in environmental improvements in disadvantaged communities.
MEASURE 2.4 CONNECTING COMMUNITIES: FINANCIAL PROFILE ERDF UK Public UK Private Total Cost Eligible Area 30.209 30.209 - 60.418 Transition Area 3.015 3.015 - 6.030
Outputs, Results and Impacts
There Measure will support a number of environmental improvement initiatives, as well as a number of community safety initiatives.
MEASURE 2.4 QUANTIFIED TARGETS Fully Transition Total Eligible Anticipated Total Spend 60.418 6.030 66.448 (meuro) Anticipated ERDF (meuro) 30.209 3.015 33.234 Fields of Intervention 352 Rehabilitation of urban areas 36 Social Infrastructure and Public Health
Outputs Number of marketing 60 6 66 initiatives supported Number of environmental 100 10 110 initiatives supported Hectares of land improved 250 25 275 Routeways improved 20o 22 220 (kms) Number of community 100 10 110 safety initiatives Results New investment as a result £160m £16m £178m of capital investment and marketing Impacts Residents securing 750 75 775 employment opportunities
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Measure Selection Criteria
Measure selection criteria will take into account:
· Community involvement (in project design etc.) · Clear, quantified and deliverable social inclusion objectives · Project directly benefits the community · Provision of dependent care to allow beneficiaries to access services and support · provided by the measure · Inclusiveness of partnership
Final beneficiaries
Final beneficiaries will include the North West Development Agency, local authorities, central government departments and local enterprise and development agencies, community, voluntary and charitable groups.
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MEASURE 2.5: BUILDING ECONOMICALLY SUSTAINABLE COMMUNITIES (ERDF)
Background and Rationale
This Measure will support focused activity to develop and embed the competence, means and capacity and knowledge of communities to deal with economic and wider social exclusion.
Excluded communities, by their nature, are removed from mainstream activity and structures. The economic problems they suffer from are compounded by health, crime and other social issues. Communities to be targeted as part of this Priority will exhibit a number of characteristics related to these issues. This affects their overall ability to act cohesively and act as a base for economic development and growth. As a result they suffer even greater disadvantage as defined by high unemployment, low skills, poor environment, and low economic activity.
This Priority will develop the ability to engage and address those issues that have a detrimental effect on their economic position in society and quality of life. Factors contributing to social exclusion, such as crime and health, have major impact upon the economic performance of areas and individuals. Promoting activity that helps to address wider exclusion, prevents further social exclusion and increases equality of opportunity will assist in improving economic performance.
It will address the disengagement of communities from mainstream society and promote integration and greater participation.
It will support/complement activity carried out under all Policy Fields of the Objective 3 Programme...
Measure Objective
The objective of Measure 2.5 is:
To build the capacity of local communities to address issues of economic and social exclusion and sustainability, and promote community involvement in regeneration and wider governance issues
Eligible Activities
Measure 2.5 will support revenue expenditure only.
1. Building the capacity of local communities to develop the ability means to address and deliver effective solutions to issues affecting them, particularly those contributing to socio-economic exclusion;
2. Supporting the employment and support costs of animateurs and mentors;
3. Developing, supporting and building the capacity of community/voluntary organisations, community structures and multi agency partnerships in pursuit of capacity building;
4. Promoting local resident participation in regeneration activities and wider governance; and
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5. Support for the development and promotion of best practice, including networking.
Financial Allocations
48.962 million euros will be incurred on Measure 2.5 projects, of which 91% is to support people and communities in the eligible areas. ERDF contributions will be matched by the UK public sector. There is no private sector contribution anticipated.
MEASURE 2.5 ECONOMICALLY SUSTAINABLE COMMUNITIES: FINANCIAL PROFILE ERDF UK Public UK Private Total Cost Eligible Area 22.259 22.259 - 44.519 Transition Area 2.222 2.222 - 4.443
Outputs, Results and Impacts
The Measure is the key capacity building measure in the Priority to increase the communities’ ability to participate and accelerate the regeneration of their areas. In all, 550 community organisations will benefit from capacity building support.
MEASURE 2.5 QUANTIFIED TARGETS Fully Eligible Transition Total Anticipated Total Spend (meuro) 44.520 4.446 48.966 Anticipated ERDF (meuro) 22.260 2.223 24.483 Fields of Intervention 22 Social Inclusion 25 Positive labour market actions for women Outputs No. of community organisations 500 50 550 provided with capacity building support Results and Impacts The results and impacts of the capacity building support, will be the more effective implementation of measure 2.1, 2.2, 2,3 and 2.4
Measure Selection Criteria
Measure selection criteria will take into account:
§ Demonstration of an understanding of best practice § Community involvement at the project development stage § Clear, quantified and deliverable social inclusion objectives § Provision of dependent care to allow beneficiaries to access services and support provided by the measure § Inclusiveness of partnership
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Final Beneficiaries
Final beneficiaries will include the North West Development Agency, local authorities, central government departments and local enterprise and development agencies, community, voluntary and charitable groups.
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2.3 PRIORITY THREE : STRATEGIC REGIONAL INVESTMENT
Introduction
The central thrust of this priority will be to support activities that offer sustainable economic growth potential within the North West. It will focus on maximising the economic and employment potential in a limited number of locations across the North West Objective 2 Programme Area. Priority Three will not only create the right physical conditions for improved regional competitiveness but it will also ensure that the investment made is firmly embedded to ensure that it is economically, environmentally and socially sustainable. The investment made will create new jobs, make a positive contribution to addressing the region’s stock of derelict land and buildings, and ensure that the jobs created are targeted at the unemployed, along with other excluded groups and communities. The proposed Measures 3.1 and 3.2 will be the key drivers for employment growth within this Priority whilst Measure 3.3 will embed the investment and secure its longer term sustainability within “Communities in Need”. For the purposes of this Priority “Communities in Need” are defined as communities that have a significant proportion of working-age residents out of work. These communities must be targeted with either Priority 2 resources from this programme and / or Objective 3 Structural Funds.
This priority will be delivered as an integrated set of actions which have a spatial impact and that draw resources down from at least two of the measures provided. Such packages of actions will be administered by a local Partnership through either an Action Plan (with Accountable Body status) or through a Local Implementation Plan (without Accountable Body status). The locations receiving these packages of actions will be designated Economic Development Zones (EDZs). EDZs will bring an area based programming approach to this priority.
An Economic Development Zone will be an opportunity driven regeneration initiative that will be of regional significance. Each initiative will have to demonstrate that the impact of the investment made will add to regional competitiveness and lead to a greater employment content in the economic growth to be achieved.
It is expected that over the lifetime of the programme that 15 Economic Development Zones will be declared. As such we would anticipate that the scale of investment for each zone would be sizeable with an anticipated average investment of £20 million pounds. The number of zones that we intend to declare reflects the regional diversity of the North West of England and the bringing together of 3 separate Structural Fund programmes along with the inclusion of significant newly designated areas. The Mid Term Evaluation of the 2000 – 2006 North West Objective 2 Programme will review the delivery and performance of this priority and will recommend to the Programme Monitoring Committee actions needed to achieve the programme targets.
Economic Development Zones will be designated across the Objective 2 programme area. EDZs will vary in nature depending on the overall purpose of the proposal – it is envisaged that 3 types of zone will be designated:
· Strategic Sites as identified by the North West Development Agency; · Area based investment of regional significance; and · Knowledge based virtual clusters that support the North West Regional Innovation Strategy.
Following recommendations made by the European Programme Secretariat the designation of Economic Development Zones will be agreed by the North West
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Objective 2 Programme Monitoring Committee. In determining Economic Development Zone designation the Secretariat will take into account the regional significance of the proposed initiative and the need for the proposal to have met the core criteria (see below) required to approve any Economic Development Zone.
Whilst the emphasis of this Priority will be to designate new Economic Development Zones there is a pressing requirement to ensure that equivalent Structural Fund investment made under previous programmes is similarly embedded into the regional economy. During the 1997 to 1999 programming periods for the Objective 2 and 5b programmes that operated in the North West of England a number of strategic investments were made with the resources available that would equate to the Economic Development Zones that are proposed for the 2000 – 2006 programming period. A significant number of these schemes commenced during 1999 and will only complete their capital investment during 2001, the last year for eligible expenditure. Such initiatives will not have the same opportunity as the proposed Economic Development Zones to embed the investment and so ensure that it is economically, environmentally and socially sustainable. Limited support will be available for actions to embed previous investment in equivalent EDZ type schemes from the 1997 – 1999 programming period will be eligible for resources from this priority under Measures 3.3.
The Regional Situation
The North West Regional Strategy stresses the need to develop the region’s key physical assets in order to underpin the issues of economic growth, employment and social growth. This document also highlights that after 20 years of active regeneration, those sites easiest to remedy, and / or in single ownership have now been returned to productive use. The remaining sites to bring forward for development are the more difficult derelict or vacant one, as well as sites in multiple ownership where one or more owners are unwilling or unable to co-operate in redevelopment. The total area of derelict land within districts wholly or partly within the Objective 2 Programme Area is 7,668 hectares (20% of England’s total). The Regional Strategy states that the development of these assets is central and fundamental to the promotion of regional competitiveness, raising regional GDP and attracting new investment, particularly private investment.
The natural and built environment of the North West is a key economic asset. For example, the Objective 2 programme area is home to:
· Parts of three National Parks -the Lake District, the Yorkshire Dales and the Peak District; · Potential World Heritage Sites – the Lake District National Park, Worsley, Ancoats and Castlefield; · Four Areas of Outstanding Natural Beauty - Arnside and Silverdale, Forest of Bowland, North Pennines, and the Solway Coast; · Three Ramsar sites; · One Heritage Coast (St Bees Head); · Twenty Four National Nature Reserves; · Nineteen Special Protection Areas (SPAs); · Sixty Nine Special Areas of Conservation (SACs); and 426 Sites of Special Scientific Interest (SSSIs)
In addition to these assets, there are 16,000 listed buildings within the Objective 2 area, 72% of the North West total. English Heritage identifies 103 Listed Buildings in
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the Objective 2 area which are “at risk”. The region also has 755 Conservation Areas and 45,000 known Archaeological Sites.
Whilst the North West Regional Strategy emphasises that the region has inherited these great assets, like any other economic assets, re-investment in these assets is required both to maintain the current level of economic benefits, but also to secure new and additional economic benefits.
Key Baseline Data
The Table below summarises the key baseline data for this Priority. The baseline data, wherever possible, will be up-dated each year in the Programme Annual Report.
Priority 3: Strategic Regional Investment – Key Baseline Data Value Year Source Hectares of Derelict Land 7668 1993 DoE Survey Number of SMEs in designated tbc investment areas Number of people employed in tbc designated investment areas1 No. of UK & Overseas visitors to the £11.5 1998 BTA region million Overseas Visitor spend in the NW (inc £423 1998 UKTS Merseyside) million Note 1: Targets to be agreed when EDZs have been confirmed Note 2 : Programme level targets for the Cross Cutting Priorities of Equal Opportunities, ICT and Sustainable development are detailed in Chapters 5,6, and 7 of the Programme Complement.
Review of Previous Experience
Within the Objective 2 and 5b programmes that operated in the 1994 – 1999 programme period there was variable experiences and outcomes associated with large scale infrastructure investment. This priority aims to build on the positive experiences that can be garnered from these programmes and to address some of the key weaknesses that have been identified through the evaluations of the programmes.
This Priority aims to declare a limited number Economic Development Zones across the North West Objective 2 Programme Area. The integrated set of actions proposed embrace both capital and revenue expenditure. The 1997 – 1999 Greater Manchester, Lancashire and Cheshire (GMLC) Objective 2 programme made a significant shift in its approach to developing large scale capital investment through Priority 5 of this programme. The following key changes were introduced:
· Independent consultants were used to evaluate submissions for strategic employment sites on a range of criteria; · Revenue resources were combined with capital resources in each of the ERDF measures (with the exception of the Manchester Bomb Measure); · European Social Fund (ESF) resources were available through a separate measure; · Entry level criteria were set that required certain levels of job creation or grant to be used to ensure that “larger” schemes were brought forward;
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· Each scheme supported was required to ensure that 45% of the jobs created were provided for residents of the designated Community Economic Development (CED) target areas.
The attempts of the 1997–1999 GMLC Objective 2 Priority 5 programme to embed the capital investment with bespoke ERDF revenue and ESF resources for each scheme supported was a departure from a more “traditional” approach that had characterised previous “large scale” capital-only investment in the GMLC area and with other Structural Fund programmes that operated in the region during this period.
Since the Mid -Term evaluation of the 1997 – 1998 GMLC Objective 2 Programme was undertaken by Pion Economics in late 1998 EKOS have conducted a more limited review of experiences and outcomes associated with investment supported under Priority 5 of this programme. The following key learning points emerged from this work:
· Twelve Measure 18 sites were initially approve by the PMC in April 1998 with three sites on a reserve list. Despite conducting an independent assessment of the bids prior to appraisal by the European Programme Secretariat by December 1999 only six of these sites had progressed to development. The key factors influencing the withdrawal of the nine schemes related to failures to secure statutory consents (planning), difficulties in land assembly and ERDF eligibility issues.
· Across the three ERDF Measures (excluding Measure 16 - the Manchester Bomb measure) between 10% and 15% of resources under each Measure were allocated for revenue activities. As the implications of these conditions unfolded applicants experienced difficulties in utilising this resource appropriately within the programme period, as the beneficiaries were not yet in place. The EPS, in agreement with the Commission, subsequently reduced the revenue requirements to between 5% and 7% of grant.
· As with the ERDF revenue experiences applicants found it difficult to utilise Measure 20 resources - the ESF funding. Again many of the beneficiaries were yet to arrive on the proposed developments and where there was a possibility of using the ESF resource (for example, within Measure 17 initiatives) applicants accessed other sources of ESF from within the Objective 2 programme. The key factor influencing these decisions were the geographical restrictions that were attached to Measure 20 by the European Programme Secretariat (EPS) which made the use of Measure 20 difficult to operate in practice. At the end of the programme these issues contributed to 4.6 million Euro being unallocated within the measure – only 1.1 million Euro was allocated in invest in Human Resource Development activities.
Substantial investment during the 1994-1999 period was also made in visitor attractions and facilities. Whilst a number of investments added to the existing tourism product e.g. Nenthead Mines Heritage Centre in Cumbria, ERDF support was also crucial to the development of a number of flagship facilities, such as the Blue Marine Aquarium at Ellesmere Port and the Lowry Centre at Salford, which demonstrate a capacity to attract significant numbers of visitors from outside the Objective 2 area.
Given the time lag for the impacts of such large capital projects to be visible, it is too early to determine the long-term effects on employment and incomes. Evidence from a number of projects, nonetheless, indicates significant net employment impacts in the longer term. Although only open since April 2000, the Lowry Centre received
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425,000 visitors in the first four months, ahead of the annual target of 770,000, whilst direct employment exceeds 200. It is estimated that 20-25% of visitors have originated outwith the North West. In combination with the footbridge, plaza, and Digital World Centre, the Lowry is making a major contribution to the regeneration of Salford Quays.
The review of tourism trends in Chapter 2 highlighted the need to enhance the existing product in order to increase, or even maintain, the Objective 2 area’s share of visitor numbers and expenditure. The focus of Priority 3 will be on supporting a limited number of developments with regional significance.
The effects of investment in sustainable public transport during the 1994-1999 Programmes are also now only becoming evident. As with tourism, assessments of impact have only been conducted on a limited number of large schemes. Independent estimates of the impact of Phase 2 of Metrolink, for example, indicated indirect employment creation of 1,650 jobs, with more than 1 million car journeys saved per annum. The routing strategy developed for Metrolink specifically aimed to enable residents of communities in need to access employment opportunities in Manchester city centre and other developments such as the Trafford Centre.
The focus of transport-related investment in the 2000-2006 period will be upon local sustainable transport initiatives, rather than large infrastructure schemes, for which significant sums are being made available elsewhere. Given the relatively limited resources available, Measure 3.3 will support initiatives to enhance the capability of residents of communities in need to uptake employment opportunities created by the EDZs and elsewhere in the Region.
Rationale for Intervention
The SWOT analysis in Chapter 7 of the SPD identified a number of key weaknesses that are holding back the economic development of the region:
· An over-dependence on sectors in decline or sectors where rationalisation has taken place; · An under-representation of service industries, particularly higher value added activities such as financial and business services; · A low proportion of foreign direct investment compared to competitor regions suggesting that there are major weaknesses in parts or all of the product – sites and premises, economic infrastructure and skills; · Substantial areas of vacant and derelict land; · A shortage of suitable sites and premises in the region of the correct quality and at the right locations to secure new investment; · A considerable number of towns and centres are going through a process of adaptation, adjusting from the decline of major sectors, and searching for a new set of core industries on which to sustain income and employment in the local economy; · A move away from traditional long stay beach holidays has resulted in the relative decline of the area’s coastal resorts; and · There are concentrations of poverty and multiple deprivation across the Objective 2 area.
The SWOT analysis also highlighted a significant number of opportunities which this priority will contribute towards:
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· The Programme Area is well represented in a number of growth manufacturing sectors and further growth around key sectors will secure new and higher value added jobs. · Increase in tourism and leisure expenditure offers the opportunity for the North West to attract more visitors and to contribute to the quality of life of residents. · Increasing opportunities for the commercialisation of research and company spin outs from the region’s Universities and research centres; · The growth in financial and business services and of creative industries as part of a general move towards knowledge based industries; · The Commonwealth Games represents a major opportunity for all of the eligible area, both in terms of the event itself, through the large number of visitors, but also as a showcase event to people from all over the world.
To address such weaknesses and exploit these opportunities Priority 3 intends to build on the experience gained from the 1997 – 1999 GMLC Objective 2 programme and declare a limited number of locations across the region as Economic Development Zones. The main driver of the investment provided will provide a portfolio of jobs focused mainly at the quality end of the job market (in relation to higher skill and income levels). The Priority will draw upon the physical assets of the Plan Area, especially it’s stock of derelict land and buildings, and develop the new opportunities for investment in the North West. The resources will seek to embed the developments into the regional economy and ensure that the employment created is easily accessible to the most economically deprived parts of the Plan Area. The priority will also seek to embed equivalent schemes that were supported under the 1997 – 1999 Objective 2 and 5b Programmes who will complete their initial capital investment in 2001.
Key Themes
Underscoring this approach the following key themes have been identified to capture the overall intent of this Priority:
· To use capital and revenue resources to develop a limited number of partnership driven Economic Development Zones across the North West Objective 2 Programme Area that will provide locations for sustained new employment growth focused mainly at the quality end of the job market; · To contribute to an increase in the representation of the North West’s identified growth sectors within the Objective 2 programme area; · To capture the untapped economic benefits for culture and tourism arising from the North West Objective 2 Programme Area’s natural, built, cultural and industrial heritage assets; · To provide packages of support to enable the unemployed and other excluded groups to access the employment created; and · To contribute to the development of a positive image of the North West Objective 2 programme area as a place to live, work, visit and invest.
Economic Development Zones
Priority Three: Strategic Regional Investment will be implemented through a limited number of Economic Development Zones (EDZs). As indicated above, a maximum of 15 Economic Development Zones will be declared. Each will be an opportunity driven regeneration initiative that will be of regional significance. All EDZs declared will demonstrate that the impact of the investment made will add to regional competitiveness and that it will lead to a greater employment content in the economic growth to be achieved. The Mid Term Evaluation of the 2000 – 2006 North West
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Objective 2 Programme will review the delivery and performance of this priority and will recommend to the Programme Monitoring Committee actions needed to achieve the programme targets.
As such, the key characteristics of EDZs will be:
· a strong partnership to define challenges, strategy, priorities, resource allocation and to implement, monitor and evaluate the strategy. Partnerships should include economic and social partners, NGO’s and residents groupings. These partnerships will be decentralised, effective and broad based and take ownership of the initiative from inception through to completion; · the linkage of a strategic plan for the area in question to the economic, social and physical network of the wider area, including between local partnerships and agents responsible for the social and economic strategy of the wider region / sub- region; · the integration of the economic, social, security, environment and transport aspects, including access to jobs and training opportunities from areas of concentrated exclusion; · a multi-annual and contractual approach with agreed outputs and performance measures; · schemes (eligible for structural funds support) that meet the priority objective and the identified key themes for Priority 3; · associated revenue and capital projects designed to strengthen links with the unemployed and other excluded groups to enable them to access the employment created; · a development plan or masterplan to guide the development proposals; · an implementation mechanism that is either an Action Plan or a Local Implementation Plan; · a planned timetable for implementation and commitment of expenditure; and · identified sponsors and financial support for key elements of the proposed activities at the outset of the investment programme.
Selection of Economic Development Zones
The selection of a bid for Economic Development Zone designation will be made using a set of core criteria. The assessment of each submission will be undertaken by consultants independent of project sponsors appointed on behalf of the PMC. The core criteria will demand detailed evaluation and appraisal of each submission on issues such as deliverability, sustainability, the realism of the proposals and their outputs. As part of the overall assessment process these criteria will be used to appraise the identified year one schemes within any proposal.
In order to be considered for approval, all proposals must demonstrate the following:
I. Capacity to commence development within 6 months of PMC approval II. Establishment of a broad-based, inclusive partnership which has ownership of the proposals and is committed to ensuring that the maximum benefit is achieved for the regional economy III. Evidence of consultations with, and support from, local stakeholders on the proposed development IV. Capability of substantial development prior to the end of 2006 V. Development of an “Employment Access Plan” that specifies the mechanisms to be employed to link the jobs created within the Economic Development Zone with “Communities in Need”
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VI. Evidence of a robust strategy/masterplan VII. Establishment of a development team with appropriate experience and capacity to ensure the successful implementation of the proposal VIII. Capability of securing identified co-financing
For proposals/plans whose eligible costs are greater than £5m or whose public sector contribution is greater than £2m, a full cost benefit analysis and environmental impact assessment will also be required. Further guidance on the European Commission requirements for a cost benefit analysis is contained in ‘A Guide to Cost Benefit Analysis of Major Projects’ which is available from the European Programmes Secretariat of Government Office North West.
The suitability of proposals will be assessed against the points I – VIII raised above and the following core criteria:
1. Contribution towards the Priority 3 objective 2. Fit with the Regional Economic Strategy and other relevant strategic frameworks 3. Scale and quality of employment to be created 4. Links to identified growth or employment intensive sectors 5. Long term viability and sustainability 6. Complementarity with Objective 3, and Priorities 1 and 2 of the Objective 2 programme 7. Potential environmental effects 8. Scale of private sector co-financing and/or leverage 9. The involvement of Further and Higher Educational Institutes in the Economic Development Zone (where applicable).
The core criteria for choosing Economic Development Zones will be adopted by the PMC, and detailed guidance will be made available to project sponsors.
Priority Objective
The SPD identified the aim of the 2000 – 2006 North West Objective 2 Programme as:
To develop a competitive and sustainable economy which offers employment and income opportunities for people of all ages, abilities and gender
Three strategic objectives were identified that would deliver this programme. Whilst all three strategic objectives will be supported through investment made under this priority the key strategic objective highlighted in the SPD that will be delivered will be:
To address the environmental legacy of the past through supporting opportunity led investment that creates new income and employment opportunities while restoring or maintaining the heritage assets of the region
The presence of significant proportions of derelict land and buildings within the North West Objective 2 Programme Area, the presence of heritage assets of international importance, and a national and regional policy context has required the programme to tackle the fundamental issues of the region’s environmental legacy but at the same time maximise the economic potential of these assets. To do so has demanded a delivery mechanism – Economic Development Zones – that can pull together a range of integrated actions which can be supported through structural funds interventions
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and that can deliver this strategic objective. Against this background the following Priority Objective has been agreed:
To secure significant additional employment, investment and income for the North West Objective 2 Programme Area by investing in Economic Development Zones based around new employment opportunities and economic diversification in a manner that supports the programme’s sustainable development principles
This Priority will be delivered through three Measures:
Measure 3.1: Developing Strategic Employment Opportunities (ERDF)
This measure will develop new strategic employment sites for industry and business.
Measure 3.2: Maximising the economic potential of the North West’s Natural, Cultural And Other Heritage Assets (ERDF)
This measure will exploit many of the region’s existing assets that cover the natural, built, cultural and industrial heritage and use them as a key catalyst for economic diversification to create or retain jobs through, for example, the development of sustainable tourism destinations. The potential will also be available to support the development of new cultural and tourism assets.
Measure 3.3: Connecting with “Communities in Need” (ERDF)
This measure will embed investment made in Measures 3.1 or 3.2, and in similar EDZ type initiatives supported under the 1997 - 1999 Objective 2 and 5b programmes, by providing resources to connect Economic Development Zones with “Communities in Need”. This will facilitate residents from these communities to access the employment created.
It is anticipated that all parts of the programme area will be capable of bringing forward EDZ submissions for Priority 3 resources. Such bids for resources could embrace all three measures, however, at a minimum it is expected that applications will cover at least Measure 3.1 or 3.2 along with Measure 3.3.
Investing Priority Three Resources within the Objective 2 Transitional Area
Given the population size and the diversity within the North West Objective 2 Transitional Area there is potential for Economic Development Zone initiatives to be developed. For example, a significant part of the Kingsway Site within Rochdale, which has been highlighted within the North West Regional Strategy as one of the region’s Strategic Sites, lies in the Objective 2 Transitional Area.
A total of 19% of EU support for the Transitional Areas has been allocated to Priority 3. This allocation will support a limited number of Economic Development Zone initiatives across the North West Objective 2 Transitional Area. Such designations will be part of the maximum of 15 Economic Development Zones to be declared within the overall Programme.
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Limited resources from Measure 3.3. in the Transitional Area will be available to support EDZ type activity funded during the 1997-1999 Structural Fund programming period. The same limitation on the use of this resource that has been set for the Fully Eligible Area will apply to Transitional Areas. The selection of Economic Development Zones within the Objective 2 Transitional Area will follow exactly the same process as Zones within the fully eligible area. The financial profile for the Transitional Area has been adjusted to take into account the size and the time taken to undertake the large strategic investments envisaged. As a result support will be available up to, and including, the year 2005.
After careful consideration, all three measures within Priority 3 will be available in the Transitional Areas. This reflects both the diversity of the Transitional Areas, and the desire to encourage the integration and packaging of complementary projects designed to secure major benefits. The relatively slow spend in the early years of the Programme, making allowance for the time need to develop major projects, has allowed the financial weighting to be more evenly spread across the Programme years, compared to the Programme level financial profile for the Transitional Areas (with Priorities 1 and 2 in Transitional Areas committing higher proportions of funds in the early years). This has allowed a minimum critical mass of at least 0.5 million euro per measure per year of EU support to be maintained up to and including 2005.
Objective 3
Objective 3 will be a key additional element in the effectiveness of Objective 2 programme and in particular the aims of this Priority. Objective 3 will be used to complement and support the overall objectives of the priority and will address specific skills training and workforce development needs of SMEs within the designated Economic Development Zones. Management processes for Objectives 2 and 3, including the application and selection process, will be brought into line to ensure maximum synergy between the two programmes. Membership of EDZ Partnerships by Learning and Skills Council and strategic training providers will also enhance the synergy between EDZ investment and Objective 3 funding.
Financial Allocations and Priority Targets
The following tables indicate the financial allocation at the Priority level, including the allocation to EU Fund, the Priority level UK Public and the private sector contributions for both the Fully Eligible Objective 2 Area and the Transitional Objective 2 Area. The allocations presented are for the lifetime of the Programme.
Priority 3: Strategic Regional Investment – Summary Financial Table (million euros) Total Costs ERDF UK Public UK Private Eligible 670.983 244.882 325.696 100.403 Transition 86.895 31.737 42.146 13.012
Careful consideration has been given to the financial contributions from the public and private sector. Priority 3 is primarily concerned with the provision of high quality business and economic infrastructure to help diversify and modernise the business base of the region. In view of the importance of modernising and strengthening the business base, the UK Public sector will be greater than the EU contribution in Priority 2 with significant additional contributions from the private sector. The private sector contribution of recognises the role likely to be played by the private sector with regard to project activity in Measures 3.1, 3.2 and 3.3, where EU support is likely to
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be limited to 15%. The Financial allocations also take account of the fact that a number of projects may have a restricted grant rate (infrastructure earning substantial net revenue) and in a number of other cases, the minimum grant needed for the project to proceed may be less than the maximum (determined by evidence of market failure and the funding gap).
The highest allocation of 37.9% to Strategic Regional Investment in the fully eligible areas takes into account the need to create the conditions to enable major new investment to take place if a fundamental shift in the industrial profile of the region is to be secured. The pre-dominance of low paid employment and the sector profile re- inforces the need for major investment, and the opportunity is also available to address the scale of brownfield land by bringing back into productive use derelict and vacant sites.
The allocation to Priority 3 in the transition areas reflects the limited resources available, and this reduces the appropriateness of the strategic investment approach. The key influence on the financial allocation has been the economic profile of the Transition Areas. Although many parts of the Transition Area have a reasonable employment record in the past few years, the overall structure is heavily weighted to sectors in decline. There is an urgent need, therefore, to improve the competitiveness of existing business and to support the development of new sectors. A greater concentration on capital investment would have led to either a “winner take all” outcome, or piecemeal and small scale investment with limited benefits across all of the Transition Area.
The following split of ERDF resources was agreed by the Partnership between the three measures, for both the eligible and transition areas:
· Measure 3.1 Strategic Employment Opportunities: 52% · Measure 3.2 Natural, Cultural and Heritage Assets: 30.5% · Measure 3.3 Communities in Need: 17.5%
The ERDF contribution in each measure will be more than matched by the UK public sector, with significant private sector co-financing anticipated in Measure 3.1 Strategic Employment Opportunities and Measure 3.2 Maximising the Economic Potential of the North West’s Natural, Cultural and Other Heritage Assets.
Priority 3 Strategic Regional Investment: Eligible Areas (million euros) ERDF UK Public Total Public UK Total Cost Private 3.1 Strategic Employment 127.339 172.839 300.178 60.201 360.379 3.2 Maximising Assets 74.689 110.000 184.689 40.200 224.889 3.3 Communities in Need 42.854 42.854 85.708 - 85.708 Total 244.882 325.693 570.575 100.401 670.976
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The annual split of ERDF by measure in Priority 3 in the fully eligible areas is as follows:
Priority 3 Strategic Regional Investment ERDF Allocation by Year in Fully Eligible Areas (million euros) 2000 2001 2002 2003 2004 2005 2006 3.1 Strategic Employment 5.093 12.734 22.921 23.685 21.648 20.884 20.374 3.2 Maximising Assets 2.988 7.469 13.444 13.892 12.697 12.249 11.950 3.3 Communities in Need 1.714 4.285 7.714 7.971 7.285 7.028 6.857 Total 9.795 24.488 44.079 45.548 41.630 40.161 39.181
In the transition areas, as with the fully eligible areas, the ERDF contribution in each measure will be more than matched by the UK public sector, with significant private sector co-financing anticipated in Measure 3.1 Strategic Employment Opportunities and Measure 3.2 Maximising the Economic Potential of the North West’s Natural, Cultural and Other Heritage Assets.
Priority 3 Strategic Regional Investment: Transition Areas (million euros) ERDF UK Total UK Total Public Public Private Cost 3.1 Strategic Employment 15.868 22.552 38.420 8.013 46.433 3.2 Economic Assets 11.108 14.834 25.942 5.000 30.942 3.3 Communities in Need 4.761 4.761 9.522 - 9.522 Total 31.737 42.147 73.884 13.013 86.897
The annual split of ERDF by measure in Priority 3 in the transitional areas is as follows:
Priority 3 Strategic Regional Investment ERDF Allocation by Year in Transition Areas (million euros) 2000 2001 2002 2003 2004 2005 2006 3.1 Strategic Employment 1.999 2.405 3.491 2.650 3.067 2.256 - 3.2 Maximising Assets 1.400 1.683 2.444 1.855 2.147 1.579 - 3.3 Communities in Need 0.600 0.722 1.047 0.795 0.920 0.677 - Total 3.999 4.810 6.982 5.300 6.134 4.512 -
The key outputs, results and impacts for the Priority are detailed below for both the Fully Eligible Objective 2 Area and the Transitional Objective 2 Area. The results of Priority Level actions are presented against gross sales and gross additional job indicators. Impacts at the Priority Level are presented for net additional jobs and GDP indicators.
Based on public sector investment of 670 million euros in the fully eligible area and 87 million euros in the transition area, 510 hectares of land will be serviced/prepared,
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as well as almost 50,000m2 of new and refurbished premises provided. In order to avoid over-estimation, premises constructed on ERDF-supported land which require further investment are excluded from the target i.e. the target of 50,000m2 relates to the premises provided directly with ERDF support.
Priority 3 investment will lead to the creation and maintenance of 52,789 gross jobs, of which 57% will be new jobs. Taking account of deadweight, displacement and multiplier effects, the net impact is forecast to be 25,167 jobs.
Priority 3 Strategic Regional Investment Quantified Targets Fully Eligible Transition Total Area Area Outputs Hectares of land serviced 452 58 510 Premises constructed (m2) 44,000 5,700 49,700 Results New jobs created 26,814 3,459 30,273 Jobs safeguarded 19,943 2,573 22,516 Increased sales (£m) 2,084 268 2,352 Sales safeguarded (£m) 1,554 200 1,754 Impacts Net additional jobs 13,287 1,714 15,001 Net jobs safeguarded 9,004 1,162 10,166 Net additional value added (£m) 388 50 438 Net value added safeguarded 246 32 278 (£m)
Delivery and Implementation Mechanisms
It is envisaged that Priority 3 resources will be allocated to designated EDZs approved by the PMC following the rigorous appraisal of a submitted Plan. Each Plan will incorporate a package of activities that fall within Measure 3.1 or Measure 3.2 (or both), and Measure 3.3. The implementation of the package will then be overseen by the local Partnership, either through an Action Plan approach (with an associated Accountable Body function who assumes responsibility for the delivery of the EDZ and its associated outputs) or a Local Implementation Plan (without an Accountable Body function).
A review of Action Plans is currently being undertaken by the Department of the Environment, Transport and the Regions.
Cross Cutting Themes – Strategic Regional Investment
The North West Objective 2 SPD has three cross cutting themes – Equal Opportunities, the Information Society and the Sustainable Development. Although these cross cutting themes have not been allocated separate sums of monies, the three “vertical” Priorities will make important contributions to the objective of each theme. The full details of each theme are presented in a later section of the Complement.
Strategic Regional Investment will generate a significant number of new jobs in the region, and these will contribute to the Equal Opportunity objective. In many cases, these will be in new and higher value added sectors. It is important that a significant
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proportion of employment is taken up by women, as a key step in reducing the earnings gap between men and women. The Employment Access Plans supported under Measure 3.3 will play a major part in securing employment for disadvantaged groups, although it is likely that Priority 2 actions will also play a major part in achieving the Equal Opportunity objectives.
The Equal Opportunity targets for Priority 3 are detailed below:
Priority 3 Strategic Regional Investment Quantified Targets Fully Eligible Area Transition Total Area Total EO Total EO Total EO Results New jobs created 26,814 12,000 3,459 1383 30,273 13383 Jobs safeguarded 19,943 8,000 2,573 1029 22,516 9,029 Impacts Net additional jobs 13,287 5300 1,714 686 15,001 5986 Net jobs safeguarded 9,004 3,600 1,162 465 10,166 4065
The Information Society will be a major influence on many projects supported within approved Economic Development Zones. There is considerable potential to use ICT as means of promoting EDZs, and also to support the development of ICT and e-commerce companies through, for example, specialist business space. The Priority also allows for “virtual clusters” and the use of ICT will be fundamental to making such clusters work in a day to day sense. With regard to Measure 3.3 real time information and other innovative uses of ICT has an important role to play in increasing the usage of public transport.
The Information Society targets for Priority 3 are detailed below:
Priority 3 Strategic Regional Investment : Information Society Quantified Targets Measure Target No. of projects using ICTs in the development of strategic 3.1 30 employment opportunities No. of projects providing ICT facilities and services to 3.2 15 support innovative ways of exploiting the economic potential of the region's heritage assets; No. of projects developing sustainable integrated ICT 3.3 10 networks to support strategic initiatives
Sustainable Development principles are a key factor in the design and implementation of Economic Development Zones. The resources available for land development are considerable, and a significant proportion are likely to be Brownfield land brought back into productive use, so minimising development pressure on the greenbelt. Significant resources have been made available to help improve and develop the built and natural environment. These resources also have an important role to play in developing sustainable employment in may parts of the Programme Area. Measure 3.3 also provides resources with regard to the transport, and the underlying aim is to support new and enhanced transport facilities and services that link areas of needed with new employment locations. Increasing public transport usage, and reducing the dependency on the car are important themes within the Priority.
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The Sustainable Development targets for Priority 3 are detailed below:
Priority 3 Strategic Regional Investment Quantified Sustainability Targets Measure Target Hectares of brownfield land made ready for development 3.1,3.2 250 Number of redundant, derelict buildings 3.1,3.2 50 Number of public transport initiatives 3.1.3.2 40 Number of initiatives to enhance the local environment 3.1,3.2 50
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MEASURE 3.1: DEVELOPING STRATEGIC EMPLOYMENT OPPORTUNITIES (ERDF)
Introduction
This measure will concentrate investment in a limited number of Economic Development Zones that have the potential to create significant numbers of jobs in key sectors that will secure new and higher value added jobs. Investment will be channelled at initiatives that are economically and environmentally sustainable and where a significant proportion of individuals from excluded groups will be able to access the jobs created. Although the emphasis is on higher value added sectors, now investments will be characterised by a variety of occupational levels. This will result in a higher proportion of employment in NVQ III and IV, although a significant proportion are likely to be lower skilled. These jobs will offer an opportunity for those living in areas of disadvantage and seeking to return to the labour market.
In the designated Economic Development Zones investment will be targeted at derelict land and buildings where the cost of preparatory and other work is a disincentive to private investment and this type of market failure necessitates public sector involvement. Within the scope of this measure Economic Development Zones will develop new strategic employment sites for industry and business. Significant employment growth will be a key outcome of each Economic Development Zone established.
The Regional Situation
As already noted in the priority rationale the Objective 2 Programme Area carries a disproportionate amount of the country’s derelict land and property – nearly 8000 hectares in total (20% of England’s derelict land and property). The condition of these assets act as a major constraint to their development and continue to contribute to a negative image of the region.
The North West Regional Strategy identifies 11 Strategic Sites across the North West of England, of which only two, Kingsway in Rochdale and Ashton Moss in Tameside, lie within the North West Objective 2 Programme area. Both sites sought funding from the 1997 – 1999 Greater Manchester, Lancashire & Cheshire Objective 2 Programme, however, only Ashton Moss was able to utilise the funds available.
Nationally, it is anticipated that there will be a continuing demand for high quality science park and business park facilities to cope with the establishment and growth of SMEs spinning out from the knowledge base. Demand for shared service facilities are likely to be significant along with the provision of high quality serviced office and incubator facilities. The forthcoming North West Development Agency review of strategic sites and property requirements in the region will outline the strategic property needs of the North West and should provide a clear investment framework for Measure 3.1 resources within the North West Objective 2 Programme Area.
Rationale for Intervention
The underlying rationale behind this measure will be to bring forward a number of strategic employment sites for development within an Economic Development Zone framework. It will address the shortage of suitable sites and premises in the region of the correct quality and at the right locations to secure new investment. It will also encourage the provision of high quality jobs within these developments. Speculative investment in sites, which may not be developed for many years, will not be a priority.
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Resources will be deployed to bring brownfield land and buildings back into use, develop appropriate site infrastructure to enable development to take place and improve the environment within and in the vicinity of each Economic Development Zone to encourage investment. As such, the ERDF resources will address market failure and the low rates of return and low land values associated with brownfield development. In bringing forward such development the Measure will make a significant contribution to improving investors perception of the region.
Measure Objective
Against this background the following Objective has been agreed for this Measure:
To develop employment sites within the designated Economic Development Zones that will create significant numbers of jobs in key industry sectors that will secure new and higher value added jobs
Financial Allocations
138.2 million euros of ERDF has been earmarked for Measure 3.1 which will be more than matched with UK public funds. It is anticipated that the private sector will contribute 17% of total costs.
Measure 3.1 Strategic Employment Opportunities ERDF UK Public UK Private Total Cost Fully Eligible Area 127.339 172.839 60.201 360.379 Transition Area 15.868 22.552 8.013 46.433
Eligible Activities
Measure 3.1 will support both capital and revenue expenditure.
1. site acquisition, reclamation and improvement of land costs; 2. provision or upgrading of on-site infrastructure, where essential for development purposes; 3. provision of high specification business, industrial and commercial premises; 4. conversion, refurbishment or upgrading of premises for business use; 5. reclamation works, landscaping, environmental improvements and the external refurbishment of buildings where such works will directly enhance development potential; and 6. revenue related activities, such as promotion and marketing, directly linked to securing the benefits of the capital investment. (funding restricted to a maximum of 10% of the capital investment costs) 7. feasibility studies, research and market assessments
Outputs, Results and Impacts
Based on total investment of 361 million euros in the fully eligible area and 46 million euros in the transition area, Measure 3.1 investment will generate significant benefits for the region. These outputs assume an average cost of £250,000 per hectare of serviced land and £700 per m2 of premises, incorporating both new build and refurbishment. 80% of serviced land is anticipated to be developed, leading to 510
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developed hectares with with an average of 2,500m2 of floorspace on each hectare of land. As with Measure 1.5, occupancy rates of 90% are assumed with a benchmark of 1 job for every 30m2 applied.
Measure 3.1 investment will lead to 40,000 gross FTE jobs, of which 65% will be new jobs and the remaining 35% will be safeguarded jobs. These results assume an average increase in sales of £80,000 is required to create of sustain one FTE job. An average occupancy target of 90% has been set for two years following project completion.
Varying levels of deadweight have been applied to the gross employment results, with lower deadweight for investment in “virtual” EDZs reflecting the emphasis on new, high growth sectors. A displacement factor of 30% has been applied across all Measure 3.1 expenditure, as well as a standard regional multiplier of 1.2.
Measure 3.1 Strategic Employment Opportunities Fully Eligible Transition Total Area Area Anticipated total spend (meuro) 360.379 46.433 406.812 Anticipated ERDF (meuro) 127.339 15.868 143.207 Fields of Intervention 1306 Renovation and development of villages and protection and conservation of the rural heritage 351 Upgrading and rehabilitation of industrial and military sites 352 Rehabilitation of urban areas 164 Shared business services
Outputs Hectares of land serviced 452 58 510 :of which, brownfield land 200 15 215 Premises provided (m2) 44,000 5,700 49,700 :of which refurbished premises 15,000 700 15,700 Feasibility/ research studies 30 6 36 supported Results New jobs created 23,768 3,090 26,858 Jobs safeguarded 12,798 1,663 14,461 Increased sales (£m) 1,883 245 2,128 Sales safeguarded (£m) 1,085 141 1,226 Impacts Net additional jobs 12,249 1,592 13,841 Net jobs safeguarded 6,580 855 7,435 Net additional value added (£m) 320.5 41.7 362.2 Net value added safeguarded 163.4 21.2 184.6 (£m)
Appraisal and Selection Criteria
Individual applications within an approved EDZ package will be appraised against specific scoring criteria for Measure 3.1 and will take into account:
1. Re-use of brownfield land and/or derelict buildings 2. Contribution to the development of priority sectors
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3. Ease of access by public transport, (taking account of location and scale), and particularly from identified communities in need
As with the evaluation and appraisal of the core criteria, consultants independent of the project sponsor, will assess these criteria as part of the initial scheme assessment.
Final Beneficiaries
North West Development Agency, local authorities, development and regeneration agencies, the private sector, higher and further education sector
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MEASURE 3.2: MAXIMISING THE ECONOMIC POTENTIAL OF THE NORTH WEST’S NATURAL, CULTURAL AND OTHER HERITAGE ASSETS (ERDF)
Introduction
The North West of England, and in particular the Objective 2 Programme area, has inherited many important assets that cover the natural, built, cultural and industrial heritage. The region has a strong sense of identity along with a heritage and environmental quality that provides an important backdrop for many key economic activities. Such distinctiveness is a key strength of the region and a major opportunity to help develop a new sustainable economy.
This Measure will target investment on a limited number of Economic Development Zones that have natural, built, cultural or industrial heritage assets. The North West Objective 2 Programme Area possesses outstanding natural heritage assets such as its National Park, its Areas of Outstanding Natural Beauty, or its nature reserves. The built, cultural and industrial heritage of the programme area would be defined as a historic structure (or set of structures) of regional significance that has the potential, if developed or improved, to stimulate additional economic benefits for the North West region.
Each Economic Development Zone will have the potential to utilise these natural, built, cultural or industrial heritage assets to create or retain jobs through, for example, the development of sustainable tourism destinations. There will be also scope to develop new cultural and tourism assets within Economic Development Zones. Within each zone emphasis will be placed on attracting new visitor demand - not merely displacing visitors from existing attractions - and demonstrating that a significant percentage of the visits will be from residents outside the North West of England – priority will be given to attracting overseas visitors. Emphasis will also be given to locations with the tourist and accommodation infrastructure to absorb additional overnight visitors.
The measure will not only create new employment but it will act as a key catalyst for the economic diversification in the sub regions that benefit from such investment.
The Regional Situation
The sheer breadth of the Programme Area’s natural, built, cultural and industrial heritage has been detailed in the Priority rationale. Structural Funds investment has played a significant role in the development of these assets and enabling them to contribute to the diversification of local economies. For example, the Mountain Massifs programme within the Lake District and Nenthead Mines Heritage Initiative in the North Pennines, the Whitehaven Regeneration Initiative in West Cumbria, and the redevelopment of Castlefield in Manchester have all developed and enhanced their heritage assets and made a significant contribution to the development of new economic opportunities in those areas.
The recent announcement by the Department of Culture, Media and Sport (DCMS) that the Lake District, and parts of Manchester and Salford (Ancoats, Castlefield and Worsley) should be candidates for nomination for World Heritage Status will act as a spur for further investment in these assets so that they can contribute to the regional economy, attract visitors and help develop a strong regional identity to the rest of the world. The NWDA are also keen to add to the existing regional product by developing new regional park resources close to the main centres of population that can enhance and conserve other parts of the Programme Area’s natural environment.
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Other heritage assets, such as the Programme Area’s coastal resorts, are recognised as important tourism and leisure destinations. However, the markets for these resorts has changed dramatically over the last ten years demanding new markets to be developed and exploited in order to stem the economic decline they have experienced. There is a need to revitalise these assets and strengthen their role as regional centres for tourism and leisure.
Rationale for Intervention
The Programme Area is endowed with some of England’s most striking natural, built, cultural and industrial heritage. The potential for increasing tourism and leisure expenditure offers the opportunity for the area to attract more visitors and to contribute to the quality of life of residents. In parallel with these developments the over-dependence of the region’s key coastal resorts on traditional long stay beach holidays has resulted in their relative decline and a pressing requirement for them to re-position themselves as visitor destinations.
This measure will bring forward a limited number of Economic Development Zones that contain natural, built, cultural and / or industrial heritage assets that have the potential to create new employment and make a significant contribution to the diversification of sub-regional economies. In doing so the initiatives will realise the economic potential of such assets in a manner that is not adversely detrimental to those assets. The measure will acknowledge that in developing the economic potential of the region’s heritage assets that, in many instances, these will not be provided by the market. However, in such instances, for example, investment in the enhancement and improvement of the natural environment, this will only be permitted where it contributes to the visitor experience.
Measure Objective
Against this background, the following Objective has been agreed for this Measure:
To realise the economic potential of natural, built, cultural or industrial heritage assets within designated Economic Development Zones which will create significant numbers of jobs and / or make a significant contribution to the economic diversification of sub-regional economies
Financial Allocations
85 million euros of ERDF has been earmarked for Measure 3.2 which will be more than matched with UK public funds. It is anticipated that the private sector will contribute 16% of total costs.
Measure 3.2 Maximising the Contribution of Natural, Cultural and Heritage Assets ERDF UK Public UK Private Total Cost Fully Eligible Area 74.689 110.000 40.200 224.889 Transition Area 11.108 14.834 5.000 30.942
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Eligible Activities
Measure 3.2 will support capital expenditure and revenue expenditure required to secure the benefits of capital investment.
1. enhancement and upgrading of existing cultural heritage and visitor attractions 2. development and upgrading of new cultural heritage and visitor facilities and attractions; 3. the enhancement and improvement of the built and natural environment where the investment contributes to the visitor experience; 4. revenue related activities, such as promotion and marketing, directly linked to securing the benefits of the capital investment. (funding restricted to a maximum of 10% of the capital investment costs) . 5. development and upgrading of visitor accommodation, where there is clear evidence of market failure (to be confirmed) 6. feasibility studies, research, and market assessments
Outputs, Results and Impacts
Based on total expenditure of 225 million euros in the fully eligible area, and 31 million euros in the transition area, it is expected that the Measure 3.2 will support approximately 60 developments, with the majority of individual costs between £2m and £10m. The gross results of this investment will be 11,500 gross jobs, assuming every £1 of investment will lead to an increase in sales of £5 and £60,000 of turnover creates or safeguards one FTE job.
30% of the gross jobs are expected to be new jobs, with the majority of jobs being safeguarded. This reflects the fact that a number of developments will supplement the existing visitor product, thereby helping to avoid reductions in tourism numbers and expenditure.
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Measure 3.2 Maximising the Benefits from the North West’s Natural, Cultural and Heritage Assets Fully Transition Total Eligible Area Area Anticipated total spend (meuro) 224.889 30.942 255.831 Anticipated ERDF (meuro) 74.689 11.108 85.797 Fields of Intervention 1306 Renovation and development of villages and protection and conservation of the rural heritage 171 Physical investment 172 Non-physical investment 173 Shared services for the tourism industry 351 Upgrading and rehabiltation of industrial and military sites 352 Rehabilitation of urban areas
Outputs New/improved visitor and cultural 17 6 23 attractions New/improved visitor and cultural 9 3 12 facilities Environmental enhancement 17 8 25 schemes Feasibility/ research studies 25 5 30 supported Results New jobs created 3,092 402 3,494 Jobs safeguarded 7,215 938 8,153 Increased sales (£m) 201 26 227 Sales safeguarded (£m) 469 61 530 Impacts Net additional jobs 1,038 135 1,173 Net jobs safeguarded 2,424 315 2,739 Net additional value added (£m) 67.5 8.8 76.3 Net value added safeguarded (£m) 82.6 10.7 93.3
As a large proportion of the increased and safeguarded sales will be drawn from within the North West, a high level of displacement (60%) has been adopted in the conversion of gross results to impact. A medium level of deadweight (30%) has also been applied, as well as a standard regional multiplier of 1.2.
Appraisal and Selection Criteria
Individual applications within an approved EDZ package will be appraised against specific scoring criteria for Measure 3.2 and will take into account:
1. Capacity to generate significant number of new visitors to the Programme Area 2. Ease of access by public transport (taking account of location and scale) 3. Integration with existing local heritage and environmental assets 4. Identification of associated marketing and promotion activity
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As with the evaluation and appraisal of the core criteria, consultants independent of the project sponsor, will assess these criteria as part of the initial scheme assessment.
Final Beneficiaries
North West Development Agency, local authorities, development and regeneration agencies, the private sector, voluntary sector.
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MEASURE 3.3: CONNECTING WITH “COMMUNITIES IN NEED” (ERDF)
Introduction
This Measure will support a range of activities designed to enable those residents from “Communities in Need” to access the employment opportunities created within designated Economic Development Zones. Communities in Need are defined as those identified in Priority 2 and Government designated and/ or funded zones such as Health Action Zones, Education Action Zones and SRB.
Each proposal for an Economic Development Zone will have to produce a bespoke Transport Plan which is regarded as fundamental to linking the jobs created with “Communities in Need”. These plans contribute to an improvement in the economic and social well being of residents from these communities. In doing so they will minimise the impact of travel on the environment by enabling people to carry out their everyday activities. Within each plan emphasis will be explicitly placed upon sustainable public transport provision. In producing a Transport Plan for each Economic Development Zone applicants will identify their requirement for Measure 3.3 resources. In doing so they should have take into account what the measure will and will not support.
The Measure will also provide support for the development of partnerships between employers in Economic Development Zones and local groups co-ordinating activities in areas of need.
The Regional Situation
The North West Objective 2 Programme area continues to have significant numbers of individuals living in the most deprived wards in the country while at the same time the spatial pattern of employment, especially new investments, is becoming driven by transport infrastructure rather than immediate access to the labour force. This has led to those with higher skills and access to their own transport to having a much wider opportunity to access the new employment generated by Structural Fund investment. To address this imbalance there is a fundamental requirement for future investment to build linkages between areas of need and opportunity using a variety of mechanisms.
Considerable success has already been achieved in developing new sustainable public transport programmes within the Objective 2 programme area. For example, the 1994 – 1996 Greater Manchester, Lancashire & Cheshire Objective 2 Programme supported the development of Metrolink to Eccles in Salford. This investment connected some of the most deprived communities within the Greater Manchester conurbation with Salford Quays, the Lowry (also funded through the 1994 – 1996 Objective 2 programme) and the forthcoming Imperial War Museum Development (funded through the 1997 – 1999 Greater Manchester, Lancashire & Cheshire Objective 2 Programme).
Rationale for Intervention
Measures 3.1 and 3.2 will create significant employment opportunities with the emphasis at the higher end of the quality job market. As part of the “Green Transport Plans” that will be demanded of each Economic Development Zone actions will be required to reduce traffic congestion and encourage the uses of more sustainable forms of transport. This measure will support initiatives that will encourage a shift towards more sustainable forms of public transport. Such initiatives must explicitly
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seek to connect zones with “Communities in Need” so as to remove a significant barrier to residents in these areas accessing the employment.
Over and above the need to ensure that physical links are made between Economic Development Zones and “Communities in Need” actions to link jobs arising from area-based developments. To achieve this it will be necessary to adopt a proactive approach to job placement, recruitment and other forms of employment linkage. Objective 3 resources will be made available for these actions. However, support will also be available through this measure for partnerships between employers and local employment or development agencies such as Jobs Action Teams.
During the 1997 to 1999 programming periods for the Objective 2 and 5b programmes that operated in the North West of England a number of strategic investments were made with the resources available that would equate to the Economic Development Zones that are proposed for the 2000 – 2006 programming period. A significant number of these schemes commenced during 1999 and will only complete their capital investment during 2001, the last year for eligible expenditure. As a result of these circumstances limited support (up to a maximum of 10% of Measure resources) will be available to EDZ-equivalent initiatives funded during the 1997 – 1999 North West Objective 2 and 5b programmes. Individual bids for resources will be made during 2001 with the expectation that any schemes supported will have completed the investment required by the end of Year 3 (2003) of the Programme. The Programme Monitoring Committee will approve any bids under this part of the programme.
Measure Objective
Against this background the following Objective has been agreed for this Measure:
To put in place the necessary capital and revenue support which will ensure that the maximum possible employment benefits from each Economic Development Zone and EDZ-equivalent initiatives flow to residents from “Communities in Need”
Financial Allocations
94 million euros of public sector investment has been earmarked for Measure 3.3 Connecting with Communities in Need. Given the focus upon improvements to public transport systems, no contribution is envisaged from the private sector towards eligible project costs.
Measure 3.3 Connecting with Communities in Need ERDF UK Public UK Private Total Cost Fully Eligible Area 42.854 42.854 - 85.708 Transition Area 4.761 4.761 - 9.522
Eligible Activities
Having regard to the initiatives outlined in Transport 2010 Ten Year Plan Measure 3.3 resources will be targeted on activities that will add value to the development of urban and regional public transport systems which connect “Communities in Need” and Economic Development Zones.
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Although the following activities have been supported under previous Structural Fund programmes that operated in the North West programme area, Measure 3.3 resources will not be available to support the following activities:
1. the construction and or improvements of trunk roads or local roads; 2. improvements, extensions to and/ or upgrading of railways; 3. further extensions to or construction of new light rail track for tram systems; or 4. the purchase of rolling stock for public transport operators.
Measure 3.3 will support both capital and revenue expenditure.
co-ordination of activities carried out by Economic Development Zone Partnerships where this will, for example, accelerate the pace of job creation, or ensure that residents from “Communities in Need” are able to benefit from the employment opportunities created;
1. development of partnerships between employers in defined areas and local groups co-ordinating activities within “Communities in Need” 2. environmental and security improvements within public transport corridors to encourage usage; 3. development and improvement of safe and secure cycling and pedestrian access; 4. park and ride, car sharing, community based transport initiatives and similar initiatives aimed at reducing car journeys into Economic Development Zones – although park and ride schemes that only favour retail development will not be supported; 5. bus priority initiatives that do not provide a direct subsidy to bus operators; 6. improved real time information systems at major bus stops and transport interchanges; and 7. new and improved inter-modal transport exchanges.
Outputs, Results and Impacts
It is difficult to predict the balance of projects that will be brought forward, and the targets presented below should be regarded as indicative. These difficulties also apply to forecasting the additional numbers of public transport journeys, and reductions in journey times. These indicators will be reported through the forecast made by individual project sponsors and reported in the Annual Report.
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Measure 3.3 Connecting with Communities in Need Fully Transition Total Eligible Area Area Anticipated total spend (meuro) 85.708 9.522 95.230 Anticipated ERDF spend (meuro) 42.854 4.761 47.615 Fields of Intervention 1306 Renovation and development of villages and protection and conservation of the rural heritage 317 Urban transport 318 Multimodal transport 352 Rehabilitation of urban areas
Outputs Local transport partnerships established 10 2 12 Bus priority initiative 10 2 12 Transport corridors improved 5 1 6 Cycling initiatives 10 2 12 Park and ride and community transport 10 2 12 initiatives Inter modal transport facilities improved 2 - 2 Results Number of additional public transport - - - journeys1 Reduction in journey times1 - - - % of employment created in EDZ 15% 15% 15% schemes taken up by residents of Communities in Need Impacts CED residents in employment after 2 12.5% 12.5% 12.5% years
Appraisal and Selection Criteria
Applications for Measure 3.3 resources will be considered against the Employment Access Plan presented as part of the proposals for each EDZ scheme. The criteria will take into account:
1. Extent of employer involvement in partnership arrangements 2. Forecast increase in public transport patronage 3. Integration with other transport-related and infrastructure investment 4. Potential reduction in congestion, reliance on use of the car
As with the evaluation and appraisal of the core criteria consultants independent of the project sponsor will assess these criteria as part of the initial scheme assessment.
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Final Beneficiaries
North West Development Agency, local authorities, development and regeneration agencies, the private sector, public and private transport operators, voluntary sector.
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3. CROSS-CUTTING THEMES
3.1 EQUAL OPPORTUNITIES PRIORITY
Background and Rationale
Equality of opportunity is about treating people fairly, and with dignity and respect, and is recognised as a basic principle of democracy. Equality of opportunity will be brought to bear at all stages of the North West Objective 2 programme, from strategy; project design; application and selection procedures, monitoring and evaluation, marketing and publicity etc. This approach is holistic and pro-active, and leads naturally to improvements in economic and social cohesion. It brings home the fact that equal opportunities is not a fringe activity, but a normal and integral part of the design and implementation of the Objective 2 programme. This also gives us an opportunity to raise awareness; clarify goals and policies; disseminate information; and set precedents within the Equal Opportunities arena as a whole.
For the purposes of the North West programme, the EU definition of equal opportunities which is solely concerned with the gender issue has been adopted by the PMC. One of the main thrusts of this is Gender Mainstreaming, with specific actions in favour of women. Gender Mainstreaming is defined as a programme of active and visible integration of gender perspectives in all policy areas, programme content, development, planning and decision making processes, along with programme management. It involves monitoring and evaluation to identify lessons learned, and disseminate good practice. This ensures gender balance so that men and women can participate on an equal footing, with the benefits of progress being evenly distributed between them. The wider UK agenda for equal opportunities, which includes disability, race, age is covered under Priority 2.
Activity supported through Objective 2 will be able, in particular, to raise awareness for and support the business case for commitments to good practice in equal opportunities. This is an essential element of managing diversity and of ensuring that the work/life balance is made more sustainable across the region. It also aims to break down barriers so that discrimination and disadvantage in the labour market and the wider community can be challenged more effectively by employers, community organisations and projects, ensuring that there is a positive knock on effect on all other areas of activity.
The UK has been in the forefront of pioneering equal opportunities legislation with which Objective 2 project promoters will need to be familiar. The legislation has resulted in considerable progress in equality of opportunity, and an end to many overt forms of discrimination. However particular inequalities remain between men and women in employment, education, training, entrepreneurship and work/life balance. These inequalities have a negative effect on growth, competitiveness, regional/national social and economic objectives, along with individual personal aspirations. Mainstreaming of equal opportunities throughout Objective 2 will help to reduce these inequalities in the North West.
A major shift of emphasis in the treatment of equal opportunities has taken place in the new generation of the Structural Funds, to meet the agreed objectives of the EU and Member States in improving the efficiency and effectiveness of the programmes. The Amsterdam Treaty 1998 reinforces and strengthens the focus on equal opportunities achievement by introducing a European wide horizontal priority into the Structural Funds. Previous programmes had vertical priorities (specific priorities contained within a programmes aims and activities). The horizontal priority has been
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introduced because the vertical approach met with only limited success in trying to improve effectiveness and equality. The horizontal priority will integrate equal opportunity objectives throughout the entire programming process. Thus in devising the framework and detail of the North West Objective 2 programme, we are introducing specific action within the Priorities and Measures, and into all general policy and management procedures. The equal opportunities aspects of the programme will link closely to those of Objective 3, which is producing an Equal Opportunities Mainstreaming Guide which will act as a template for Objectives 1 and 2 also.
Current Situation In The North West
SPD Chapter 3, Gender Baseline, and Chapter 2, Conditions in the Region give details of the current situation. A summary of the main gender issues are:-
Employment Trends - In recent years in the Objective 2 areas there has been rapid female employee growth, jobs have increased and a high proportion of these have been part time, with a sizeable proportion of these being taken up by males (however, male part time employment is still only a quarter of the female figure), therefore women are still in the majority in part time working, which is often unskilled with little emphasis on training. As a result the quality of part time work does not make the most of the skills women have to offer. This plus the fact that there is a greater concentration of women in the lowest paid sectors, means there is an issue about the quality of jobs held by women in the North West.
Even in some newer North West industries women’s participation is in decline e.g. in I.T. which provides both low and high paid jobs, there is a decline in the female proportion of the workforce. Females are also under represented in the North West workforce compared to the national position.
Gender stereotyping - This is still a major issue in the North West employment scene, particularly horizontal segregation, where women are often restricted to certain types of work. The majority of sectors continue to be dominated by one gender e.g. 70% of manufacturing employees are men. Talent, potential and experience is often under-utilised or wasted. Vertical segregation is still prevalent with women still being under represented in more senior positions, even in those industries where they form the largest part of the workforce. Therefore there is a need to educate employers as the to business case for equal opportunities, and to break down the attitudes that still uphold these barriers in the North West.
Pay gap – The gender pay gap in the North West is illustrated by the fact that overall female earnings continue to lag well behind those of males (29% less, with male average earnings being £9.80 per hr, and female £7.60 per hr). The gender pay gap illustrates the fact that stereotypical employment patterns still exist in the North West and are hard to break. Female average earnings are 30% below the male figure in manufacturing, although in the service sector females earn a higher hourly rate than males. The gender pay gap actually widened in the North West from 1994-1998 compared to a slight national improvement. Recent research on behalf of the Women’s Unit of the Cabinet Office, shows that females in the UK are likely to earn between £143000 - £241,000 less than men in equivalent occupations, over their working lifetime. Women returners also lose out to childfree women mainly due to working reduced hours on their return to work. Objective 2 in the North West will link to the work and aims of the Equal Opportunities Commission Valuing Women initiative, which aims to raise public and business awareness of the pay gap.
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Participation in economic activity – whilst there has been a significant increase in the number of economically active women, significant disparities remain. The convergence of activity rates is a slow process with males still more than 10 percentage points above female rates.
Self employment - there are more than three times as many males as females who are self employed in the North West, although the gap is narrowing. Self employment is an option that should prove attractive to women and members of excluded groups, but many show interest only to find that the relevant help, information, and most important of all – finance is not available to them, or difficult to obtain. Women have shown that they are particularly suited to self-employment, especially where they have to combine work and family commitments.
Unemployment - Males comprise the majority of the claimant unemployed, although this partly reflects the greater likelihood of women to be registered. The ILO unemployment statistics show that overall unemployment among women has fallen in the Objective 2 areas, although the rate remains above the national average. Females in the North West remain less likely than males to be long-term unemployed – 12.3% as opposed to 20.7% males.
Occupational trends – Data on occupational trends in the North West showed the largest increase was in the share of managerial and administrative occupations. Women are still in the majority in administrative jobs, but not in managerial ones. Female career paths are still less certain than males, and so they have greater difficulty in getting to the top. There is still an outmoded attitude within some company structures which makes it even more difficult for women to achieve their full potential.
Annex 7 of the Skills and Learning Strategy for the North West details the Industry sectors in the region which had gender concentrations of less than 30% in 1998. Out of 49 sectors it showed women to be in the majority in only 2 -–the Health and Social work, and education sectors. Out of the remaining 47 women made up less than 30% of the workforce in 28 of the sectors. Among these were agriculture, electrical engineering, manufacturing, distribution, communications, computing services and chemical sectors, all of whom cover a large percentage of the regional workforce. Sector gender segregation is evident even at the Modern Apprenticeship stage, where traditional male/female choices are still being reinforced.
Child/Dependant/elder care – care issues are a fundamental part of the work/family life balance debate. Care issues are not just a social concern but have considerable impact on economic prosperity, as they present barriers to carers trying to reach their full economic and personal potential. More needs to be done to provide the range of quality and care which is needed, and to develop family friendly employment policies to balance home and work life. Currently there are not enough childcare places, where they are available the cost can be prohibitive, and it is difficult to find out what is available. Therefore Objective 2 will link into the Government’s National Childcare Strategy activity, by having projects either create provision, provide access to or information on local childcare facilities, and provide support for approved informal childcare arrangements. Projects will also be encouraged to access Childcare Link, the new national information line and website, and contact any Early Excellence Centres, Sure Start projects, and area childcare partnerships set up in the North West. The possibility also exists for accessing Objective 3 funding to deliver Childcare NVQs or other training for the benefit of the projects. There is also an increasing concentration of working and caring on women and men of the “prime working age” 25 –50 years, when careers and pension foundations are built up.
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Having this process interrupted by care considerations causes problems. Increasingly people have dual responsibility for both child and eldercare. Lone parents have considerable problems in accessing childcare to be able to return to work, although Government initiatives e.g. New Deal for Lone Parents is trying to alleviate this. With these considerations in mind North West Objective 2 projects will be structured to take account of the needs of carers e.g. by offering flexible hours on projects, to enable them to maximise opportunities offered.
Priority Objectives
The overall Priority Objective is:
“To mainstream and promote gender balance by maximising opportunities for women in the North West Objective 2 programme. To be achieved by means of promotion, provision of support, and prioritisation of activities that address barriers to participation, and increase the take up of opportunities provided by the programme, thus leading ultimately to improved access and participation in all levels of the labour market”
Implementing The Strategy
Each of the three vertical priorities include clear commitments to integrating actions in support of the Equal Opportunity Priority. These will ensure that all actions supported within the three priorities and their associated measures comply with the objectives of the Equal Opportunity Priority. The following mechanisms will be supported:
1. Scoring and Appraisal Criteria: in addition to the prioritisation of Equal Opportunity related activities within the selection criteria for each of the 3 vertical priorities, each project/scheme application will be subject to a gateway assessment prior to detailed scoring. Sponsors whose applications do not meet the requirements of the gateway criteria will be provided with support to strengthen their application, where appropriate.
2. Equal Opportunities Advisory Group: implementation of the Equal Opportunity Priority will be overseen by an Advisory Group who will report directly to the PMC. The Group will comprise recognised experts who will consider the Equal Opportunity aspects of projects in all 3 priorities.
3. Support and Guidance for Project Sponsors: in order that project sponsors are fully aware of the need to incorporate Equal Opportunity considerations into project design and implementation, detailed guidance will be made available.
1. Scoring and Appraisal Criteria
All applications/schemes will be required to meet agreed “gateway” criteria, in order that a project’s content, focus or direction is consistent, and does not detract, from the objectives of the Equal Opportunity priority.
The gateway criteria will take into account:
1. The extent to which project sponsors of revenue projects have made arrangements for training and awareness raising of project staff in equal opportunities
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2. The extent to which project sponsors of capital projects have taken into consideration gender equality issues in the design of new facilities, such as personal safety, access to childcare, proximity to public transport routes
3. The extent to which appropriate gender related targets have been set and appropriate monitoring arrangements proposed.
Sponsors whose projects do not pass the initial gateway assessment will be encouraged to rework their application, taking into account the recommendations made. Advice and support will be provided by the European Secretariat and/or the Advisory Group as appropriate.
In addition to the gateway criteria, a proportion of the total score will be earmarked for an assessment of a project’s contribution towards the objectives of the Equal Opportunity Priority. The criteria will take into account:
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Priority 1 Business and Ideas Criterion Measure Encourages women to participate in business start-ups 1.1 Encourages women to participate in creation of new technology businesses Encourages companies to adopt Equal Opportunities Action Plans Supports female-owned businesses to increase turnover, 1.2 profitability and sustainability/ survival rates Encourages companies to adopt Equal Opportunities Action Plans Encourages companies to adopt Equal Opportunities Action 1.3 Plans Encourages women to participate in business networks and 1.4 clusters Encourages companies to adopt Equal Opportunities Action Plans Encourages companies to adopt Equal Opportunities Action 1.5 Plans
Priority 2 People and Communities Criterion Measure Encourages women to participate in micro and 2.1 community business start-ups Supports access for women to employment 2.2 opportunities Supports access for women to training and development opportunities Provides support for beneficiaries with child/ dependent care Supports the participation of women in management 2.3 and the control of projects and partnerships (e.g. capacity building initiatives, good practice networks, community ICT development) Provides support for beneficiaries with child/ dependant care Encourages women to take up ICT opportunities Supports the participation of women in the 2.4 management and control projects and partnerships (e.g. marketing, environmental and community safety initiatives) Provides support for beneficiaries with child/ dependent care Supports the participation of women in the 2.5 management and control of projects and partnerships (e.g. community capacity building initiatives) Provides support for beneficiaries with child/ dependent care
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Priority 3 Strategic Regional Investment Criterion Measure Supports access for women to employment 3.1 opportunities resulting from Employment Access Plans developed for each EDZ Supports the participation of women in the management and control of projects Supports access for women to employment 3.2 opportunities resulting from Employment Access Plans developed for each EDZ Supports the participation of women in the management and control of projects Supports access for women to employment 3.3 opportunities Supports the participation of women in the management and control of projects
These criteria will ensure that, while there is no direct financial allocation to the Iequal Opportunity Priority, the strategy will be implemented through the three vertical priorities of the SPD, their constituent measures and the Programme management and implementation arrangements.
2. Equal Opportunity Advisory Group
It is proposed that the day-to-day implementation of the Equal Opportunity Priority be overseen by a dedicated Advisory Group, which will be a sub-group of PAG. The Group will comprise between 6 and 10 individuals with extensive experience of Equal Opportunities.
The other management groups will also include Equal Opportunity representatives, and it is proposed to develop a Gender Mainstreaming Action Plan (possibly supported by Technical Assistance) to help secure Equal Opportunity objectives. This Plan will, over the life of the programme, improve gender balance by encouraging partner organisations to instigate such activities as mentoring.
3. Support and Guidance for Project Sponsors
In order that project sponsors are fully equipped to address the challenges set by the Equal Opportunity Priority in relation to project design and implementation, a comprehensive range of guidance and support will be made available. An Equal Opportunity guidance paper will be prepared explaining, inter alia, the gateway and scoring criteria, the policy context, potential activities and methods of monitoring and evaluation. Where appropriate, the guidance will be illuminated by previous examples of good practice from within the North West as well as other Structural Fund programmes.
Key Baseline Data
Baseline data has been identified and presented in Chapter 3 of the SPD and this will enable progress towards Programme targets for the Information Society Priority to be measured.
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The Equal Opportunity targets for Priority 1 are detailed below:
Business and Ideas Quantified EO Targets Fully Eligible Transition Total Area Area Outputs Total EO Total EO Total EO New companies assisted 5,000 2,000 2,450 1,000 7,450 3,000 SMEs assisted 12,000 3,3001 5,880 1,5001 17,880 4,8001 Results New jobs created 22,000 8,800 5,625 2,250 32,780 11,050 1 Owned or managed by EO target group
There is no baseline data available for the number of women operating technology related business. As a consequence, it is not possible to set a target for this indicator. Instead, monitoring data will be collected and reported in the Annual Report. This also applies to women as members of networks and companies with EO policies. Target may be set in the later years of the Programme for these indicators.
In order to ensure that appropriate monitoring data is available, project sponsors in Priority 1 will have to commit to providing gender and other EO target group related data in terms of the owner /manager/founder of the enterprise, and similar data with regard to current employees and employees recruited as a result of Programme support. The provision of such information will be a condition of support.
PRIORITY 2 – PEOPLE AND COMMUNITIES
The Equal Opportunity targets for Priority 2 are detailed below:
Priority 2 People and Communities Quantified Targets Fully Eligible Transition Total Outputs Total EO Total EO Total EO Number of people supported 2,000 800 200 80 2,200 880 with self employment No. of people assisted 3,000 1,500 300 150 3,300 1,650 towards employment No. of people provided with 15,000 7,500 1,500 750 16,500 8,250 learning support Results People (residents) with 21,000 10,500 2,100 1,050 23,100 11,650 improved IS skills Number of people (residents) 1,470 735 147 73 1,617 808 securing employment New jobs in micro and 2,600 1,300 260 130 2,860 1,430 community enterprises No. of employment/learning 9,500 4,750 950 475 10,250 5,125 beneficiaries securing a positive outcome
Project sponsors will be required to provide a breakdown of beneficiaries by EO target group. In addition, baseline data on the numbers of women involved in the
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management structures of projects will also be required. The provision of this information will be a condition of grant.
Priority 3 – Strategic Regional Investment
The Equal Opportunity targets for Priority 3 are detailed below:
Priority 3 Strategic Regional Investment Quantified Targets Fully Eligible Transition Total Area Area Total EO Total EO Total EO Results New jobs created 26,814 12,000 3,459 1383 30,273 13383 Jobs safeguarded 19,943 8,000 2,573 1029 22,516 9,029 Impacts Net additional jobs 13,287 5300 1,714 686 15,001 5986 Net jobs safeguarded 9,004 3,600 1,162 465 10,166 4065
In order to monitor the employment effects of this measure, project sponsors will have to arrange for on-going monitoring exercise to be undertaken for some years after project completion. This work would have to include the collection of data on the gender make up of people taking up opportunities within EDZs. A commitment to t his monitoring will be a condition of grant.
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3.2 INFORMATION SOCIETY PRIORITY
Background and Rationale
The impact of the Information Society on the North West of England as a whole is highly differentiated, both in terms of geography and economic sectors within the regional economy. Side by side with the rapid growth of certain parts of the Internet industry and e-commerce services there are still many parts of the region where access to new information and communication technologies is seriously lagging behind UK and EU trends. This is partly due to continued market failure, where there is a lack of private initiatives and investment due to structural factors in both urban peripheries and rural areas. It is also due to a growing disparity between 'information rich' and 'information poor' and a lack of progress in connecting opportunities and needs, especially amongst disadvantaged groups.
Alongside this, however, the North West, and the eligible areas within the region in particular, do have some essential advantages which offer opportunities to ensure that real local benefits can be gained from the Information Society to support both regional competitiveness and promote social inclusion. The region is increasingly attracting inward investment from Internet and e-commerce companies and now has the only international Internet exchange in the country outside of London, Telecity which is based on the Manchester Science Park. This is beginning to have a positive impact in the way that the region is being perceived in the global market place, but has yet to feed through into the required levels of employment growth which will ensure that there is enough of a critical mass to achieve longer term sustainability.
The challenge now is to find ways of connecting these pockets of high growth across the region and to develop pathways into employment in these growth areas for society as a whole. The starting point for this to ensure that there is a fully integrated approach which builds upon the head start gained by the region in developing a clear strategy for realising the potential of the Information Society.
The European Commission has stressed that "information society measures under the regional plans financed need to be the result of an integrated and single strategy". As the North West was one of the first pilot projects under the Inter- Regional Information Society Initiative - IRISI - it is well placed to build upon the experience gained through IRISI-NW. The Programme will, as a result, be using the Regional Information Society Strategy, produced by IRISI-NW and endorsed by the NWDA and NWRA, to constitute the framework for assessing the measures to be included in the Programme and activities to be grant aided. In line with Commission guidance the Strategy will be the core component of this cross-cutting theme which will ensure that every measure has appropriate information society related sub- measures incorporated into it.
In taking this approach within this SPD this takes account of EU guidance which states that Structural Fund support for the Information Society should be based on "incorporating into every measure appropriate information society-related sub- measures. These sub-measures should, in turn, be viewed collectively and structured so as to reflect a region-wide integrated information society strategy". (Technical Paper 2 Information Society and Regional Development. 2.8.1999).
Priority Objective
The Information Society Priority will ensure that all of the SPD Priorities and Measures take account of the need to include support for the information society as a
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cross-cutting theme. The objective is to ensure that information society technologies and the creative industries, especially e-commerce and new media, can play a strategic role in improving the competitiveness of the region and supporting social inclusion. In doing this the Programme will be adding value to both national and European policy initiatives aimed at stimulating economic growth and social inclusion through innovative approaches to the information society.
This priority recognises the need to create greater synergy between priority themes which address information society and innovation policies and activities, in line with the policy direction given by the Commission, and to complement the commitment made by the Commission to promote better co-ordination between measures under the Objective 2 Programme the new innovative measures proposed for 2000-2006. In particular this priority aims to support the implementation of the e-Europe initiative and the application of the following issues at regional level:
· bringing all citizens, households, businesses, schools and administrations into the digital era and given them on-line access; · introducing into Europe a digital culture underpinned by a spirit of enterprise that encourages the funding and development of new ideas; · ensuring that the entire process is geared towards social integration, wins consumer confidence and reinforces social cohesion.
At a regional level the Priority aims to link together the over-riding commitment to build a knowledge based economy for the North West with the specific focus on creating a digital culture for everyone, underpinned by enterprise and innovation. To achieve this the region must make more effective use of the e-business capacity that is already there and create the conditions for this to grow from the top to the bottom of all supply chains. Only this approach will add real value to the regional supply chain and ensure that the region can compete effectively within e-Europe and the global marketplace. E-commerce and e-government must become, therefore, central to the business process of all businesses and all level of public administration. This is recognised in the Regional Innovation Strategy and will be enhanced in the regional information society strategy as it is revised. This Priority will ensure that these strategies are fully complementary and that key issues, such as intellectual property rights, privacy and social inclusion, are integrated at all levels. A further objective of this priority will be to develop a benchmarking system to assess the performance of information society related measures and actions against standards and best practice being implemented on an inter-regional basis. This will help in evaluating the effectiveness of assistance provided by the Programme and in achieving the required levels of accountability, value for money and appraisal of future decisions on investment and assistance. The Programme will draw upon the recommendations of the Commission in developing criteria for the prior appraisal of information society related projects, including:
· The growth of telecommunications traffic and the ratio of voice to data telecom traffic; · Rates of take-up and growth of key e-commerce applications and services; · Market accessibility for firms, especially in relation to content production; · Improvements in the affordability and accessibility of services; · Estimates of the creation of new employment and training opportunities; · Diversification of the local economy into knowledge related activities; · Improved exploitation of cultural assets.
This Priority aims to enhance the ability of the region to compete more effectively in the global market place by exploiting information society technologies, expertise and
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related creative potential and translating these into high-value products, applications and services. This will be based on the commitments made in the White Papers on Competitiveness and Electronic Commerce to stimulate creativity across all sectors of the economy while, at the same time, drawing upon best practice in ICT and new media to ensure that the region can gain real economic and social benefits from innovative uses of advanced information society technologies.
The primary Policy Objective is, therefore:
"To increase the use of new information, communication and media technologies by all groups in society and to ensure that this is achieved in the most inclusive and sustainable ways possible"
Implementing The Strategy
Each of the three vertical priorities include clear commitments to integrating actions in support of the Information Society Priority. These will ensure that all actions supported within the three priorities and their associated measures comply with the objectives of the Information Society Priority. The following mechanisms will be supported:
1. Scoring and Appraisal Criteria: in addition to the prioritisation of Information- Society related activities within the selection criteria for each of the 3 vertical priorities, each project/scheme application will be subject to a gateway assessment prior to detailed scoring. Sponsors whose application do not meet the requirements of the gateway criteria will be supporting in strengthening their application, where appropriate.
2. Information Society Advisory Group: implementation of the Information Society Priority will be overseen by an Information Society Advisory Group who will report directly to the PMC. The Group will comprise recognised sector experts who will consider the Information Society aspects of applications in all 3 priorities, particularly Priority 1. Further details on the role of the Advisory Group is provided below.
3. Support and Guidance for Project Sponsors: in order that project sponsors are fully aware of the need to incorporate Information Society considerations into project design and implementation, detailed guidance will be made available.
1. Scoring and Appraisal Criteria
All applications/schemes will be required to meet agreed “gateway” criteria, in order that a project’s content, focus or direction is consistent, and does not detract, from the objectives of the Information Society priority. Sponsors will be required to complete an Information Society audit, which will identify any ICT implications of their project and the approach adopted to deal with any issues raised.
The gateway criteria are:
1. Clear identification of the ICT market failure which the project will address and the market demand for the services which the project intends to provide 2. Publication of a project’s activities on the Web in order to increase awareness and disseminate good practice
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3. The potential of ICTs in reaching and working with the target beneficiary group has been maximised 4. For projects which provide ICT advice, support or training, that the technologies covered are a recognised industry standard 5. For all business support projects, identify how awareness and uptake of ICTs will be promoted and facilitated amongst beneficiary SMEs 6. For all premises projects, identify how the accommodation will possess appropriate ICT facilities and infrastructure
Projects deemed not have met the gateway criteria will be those which, inter alia:
· Promote the utilisation of outmoded technologies or applications · Merely provide services or advice which are widely commercially available · Utilise traditional delivery methods when ICTs offer a clear opportunity to reach a wider audience · Provide business premises which are incapable of accommodating the ICT requirements of incoming SMEs
Where appropriate, applications will be referred to the Information Society Advisory Group for their opinion, particularly where there are issues over the suitability of particular technologies.
Sponsors whose projects do not pass the initial gateway assessment will be encouraged to rework their application, taking into account the recommendations made. Advice and support will be provided by the European Secretariat and/or the Advisory Group as appropriate.
In addition to the gateway criteria, a proportion of the total score will be earmarked for an assessment of a project’s contribution towards the objectives of the Information Society Priority. The criteria are as follows:
Priority 1 Business and Ideas Criterion Measure Support for new ICT-related startups and early life 1.1 businesses Activities to encourage new ICT entrepreneurs Support for existing ICT-related SMEs 1.2 Activities to encourage adoption of ICTs amongst SMEs 1.2 Schemes which target ICT businesses with finance 1.3 constraints Support for advanced ICT related networks and clusters 1.4 Schemes which target ICT related innovation support/advanced e-business applications Provision of premises geared to the requirements of new and 1.5 established ICT businesses
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Priority 2 People and Communities Criterion Measure Support for ICT-related community enterprises 2.1 Capacity building which increases community ICT 2.2 awareness and participation Use of ICT to overcome barriers to learning and participation ICT Awareness raising initiatives in communities in need Local community involvement in the design and 2.3 delivery of ICT services Use of ICT services and facilities to help encourage 2.4 investment and improve image Use of ICT-related delivery methods for training 2.5 Use of ICT to facilitate community engagement and participation
Priority 3 Strategic Regional Investment Criterion Measure Targeting of ICT-related businesses for premises 3.1 supported 3.1 Provision of ICT services to help embed strategic investment Utilising ICTs to develop innovative ways of 3.2 exploiting natural, cultural and heritage assets Development of ICT-based information services to 3.3 improve access by communities in need to EDZ employment
These criteria will ensure that, while there is no direct financial allocation to the Information Society Priority, the strategy will be implemented through the three vertical priorities of the SPD, their constituent measures and the Programme management and implementation arrangements.
Further details of the scoring criteria, including benchmark values with each criterion, will be provided in the ICT guidance.
2. Information Society Advisory Group
It is proposed that the day-to-day implementation of the Information Society Priority be overseen by a dedicated Advisory Group, which will be a sub-group of PAG. The Group will comprise between 6 and 10 individuals with extensive experience of ICT, innovation and the relationship with business competitiveness and wider regeneration. The responsibilities of the Group will include:
- Endorsement of the ICT guidance, including annual updates - Facilitating workshops and advisory sessions for project sponsors - Provision of ad-hoc advice and support on technical aspects of individual project applications, where necessary
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- Monitoring of progress towards the Information Society targets - Monitoring of developments in the Information Society field including technical specifications, skill requirements, policy context and providing an assessment of the implications for the Objective 2 programme as appropriate.
In order to execute this role effectively, it is envisaged that the Advisory Group will be supported by a research/project officer, part-funded by Technical Assistance. This project officer will act as a nominated point of contact within the Secretariat for ICT- related advice and support requested by project sponsors.
3. Support and Guidance for Project Sponsors
In order that project sponsors are fully equipped to address the challenges set by the Information Society Priority in relation to project design and implementation, a comprehensive range of guidance and support is required. An Information Society guidance paper will be prepared explaining, inter alia, the gateway and scoring criteria, the policy context, potential activities and methods of monitoring and evaluation. Where appropriate, the guidance will be illuminated by previous examples of good practice from within the North West as well as other Structural Fund programmes.
The written Information Society guidance will be supplemented by a programme of workshops and seminars for project sponsors, tailored to suit the needs of different types of sponsors (e.g. business support agencies, community development organisations). The number and location of workshops will be responsive to the demands of project sponsors.
Further development of the North West Objective 2 programme website (www.northwestpost99.org.uk) will also be undertaken, in order that the site acts as working forum for exchange of project ideas and dissemination of good practice. Specific sections on the website will be devoted to how approved projects have incorporated Information Society issues into project design and implementation.
This will be complemented by proactive Programme management arrangements which will use Web based applications in order to:
- Develop easy to use electronic formats for application forms, monitoring returns, data exchange and technical assistance;
- Develop interactive tolls for monitoring and evaluating projects, and
- Establish minimum standards for projects top publicise their activities in order to maximise project visibility, accessibility and transparency.
Key Baseline Data
The following baseline data has been identified which will enable progress towards Programme targets for the Information Society Priority to be measured.
Baseline: Source:
A. Employment in the Information Society. Annual Employment Survey
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B. % of total employment accounted for by Annual Employment Survey the Information Society C. No. of businesses using e-commerce for trading Regional Data Sets/IRISI Survey* D. % of businesses using e-commerce for trading Regional Data Sets/IRISI Survey* E. Access to the Internet at work Regional Data Sets/IRISI Survey* F. Access to the Internet via community based Regional Data Sets access facilities G. Access to the Internet at home Regional Data Sets
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Outputs, Results and Impacts
Information Society Quantified Output Targets Measure Target Total Assisted Target No. of e-commerce/Internet based new 1.1 7,450 750 businesses No. new businesses making use of e- 1.1 7,450 4,000 commerce No. of existing SMEs developing new ICT 1.2 11,920 3,000 systems No. of existing diversifying through e- 1.2 11,920 3,000 commerce No. SMEs/start-ups assisted in securing 1.3 1,880 1,000 investment finance will be e-commerce and/or e-business ventures SMEs involved in networks/clusters will be 1.4 8,160 4,000 using advanced information society applications No. projects receiving assistance will 1.5 10 2 develop innovative ICT facilities within new premises ICT related community enterprises 2.1 385 75 People into self employment (ICT related) 2,000 300 No. of projects assisted using ICT to support 2.1 200 80 the development of community based employment opportunities No. of projects using ICT to improve access 2.2 200 80 to employment No. of projects using ICT to support a cross- 2.3 200 200 measure approach to addressing social exclusion No. of projects using ICTs in the 3.1 15 15 development of strategic employment opportunities No. of projects providing ICT facilities and 3.2 30 15 services to support innovative ways of exploiting the economic potential of the region's heritage assets; No. of projects developing sustainable 3.3 50 integrated ICT networks to support strategic 10 initiatives
Project sponsors will be required to provide a breakdown of beneficiaries by Information Society target group. The provision of this information will be a condition of grant.
In addition other indicators will be used, in line with Commission guidance, to assess progress towards increasing the rate of growth and the sustainability of information society technologies. These are :
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1. Achieving an overall rate of growth of telecommunications traffic and an improved ratio of data to voice telecom traffic in line with appropriate national and European comparisons;
2. Increasing the rates of take-up and growth of key e-commerce applications and services in relation to the baseline data provided by the IRISI/NWDA regional survey and other appropriate data sets;
3. Aiming for at least 50% of SMEs assisted being rated as having good or very good access to market applications;
4. Achieving year on year reductions in the cost of value added services;
5. Encouraging further and faster growth in new employment and training opportunities related to the Information Society and contributing towards a reduction in skill shortages in these areas;
6. Increasing the number of SMEs diversifying into knowledge related activities;
7. Developing new projects which use ICT to improve economic exploitation of heritage assets.
As a number of these objectives cannot be assessed solely through the collection of monitoring data from project beneficiaries, these objectives will be the subject of periodic studies as determined by the PMC, following advice from the Information Society Advisory Group.
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3.3 SUSTAINABLE DEVELOPMENT
Background and Rationale
Sustainable development involves the integration of social, economic and environment objectives simultaneously in a harmonious manner. These objectives have traditionally been seen as being disparate and conflicting. This is particularly the case with regard to environmental protection and enhancement, which was often mistakenly viewed as a constraint upon economic growth. The North West suffers from a number of problems which are a legacy of its industrialisation which traded short term economic gains for long term social and environmental losses. Under increasing pressure from global competition, the North West also faces considerable pressure to restructure its economy. In combination, these social, economic and environmental issues are a serious threat to regional competitiveness, impact adversely on the quality of life of its inhabitants and contribute to a negative image which dissuades potential investors and visitors.
These issues include:
Economic - GDP per head lower than UK / EU average; over-dependence on sunset industries; Low rates of business start ups and self employment and deficiencies in the skills base.
Social - pockets of severe social exclusion; high crime levels and perceptions of crime; low educational attainment levels; and considerable disparities in health standards
Environmental - more derelict land than any other UK region; lower tree cover than any other UK region; 30% of the region’s waterways classed as poor or bad; poor urban air quality; and production of more waste than any UK region other than the south east, but with a landfill capacity of less than 4.5 years.
For the SPD to be successful it must therefore ensure a simultaneous win-win-win scenario for the region’s social, economic, and environmental goals as opposed to the discredited ‘trade off’ approach. This SPD takes account of the need to pursue this approach as advocated at EU, national and regional level. Sustainable development is both a challenge and an opportunity to businesses in the North West.
The need to improve energy and resource use and waste management practices has resulted in fiscal instruments such as the Climate Change Levy and the Landfill Tax; legislative instruments such as Integrated Pollution Prevention and Control (IPPC) and the Packaging Regulations. Trends suggest that these fiscal and legislative instruments will continue to increase in scale and be more stringently enforced. Several more are already in the pipeline such as the End of Life Vehicles Directive, the Waste from Electrical and Electronic Equipment Directive, and a UK aggregates tax. This is a particular challenge in the North West as the region is home to much of the UK’s energy, resource and waste intensive industry (e.g. 25% of UK Chemicals sector is found in the North West). These pressures are clearly a threat to the viability of these firms which, in many cases are already subject to extensive competition from the low cost economies.
Demands for improved environmental management are increasingly being driven through supply chains. Whilst many SMEs have previously escaped environmental legislation, their customers are now demanding accreditation to formal environmental management systems. Many large companies in the North West are now accredited
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to formal environmental management systems and are starting to require this from their suppliers.
The North West has not responded well to these challenges in the past. Environmental management has not been seen as a conventional or mainstream business issue. For example, in 2000 there are only 2 specialist environmental advisors with the region’s network of Business Links. Environmental business support is uncoordinated and results in a patchy distribution of support services across the region varying greatly in availability and quality.
Despite this, there are many opportunities. Good environmental management has significant financial benefits. The North West has been home to a number of innovative projects that have demonstrated these benefits to SMEs. Environment 2000 and the Business Ecology Demonstration Project funded under the last round of GMLC Objective 2 identified savings to SMEs of over £9 million. However, despite these financial benefits, the uptake of environmental management has remained low – particularly in the SME sector (for example, in 1999, of the 100 firms in the North West accredited to the ISO14001 environmental management standard, none were SMEs).
Cleaning up the region’s legacy of contamination, poor water quality, reducing and recycling its waste and generating its energy demands from clean and renewable resources presents immense business opportunities. The global market for environmental technologies and services is currently estimated at $200bn and is forecast to treble in next ten years. The UK has only a 6% stake in this massive market. A national target to generate 10% of energy from renewable sources by 2010 will further assist the development of this market.
A number of key environmental projects have stemmed from the North West’s Regional Strategy. The ‘Environmental Economy’ of the North West will evaluate the value of the environment and the environmental sector to the region’s economy. A feasibility study to examine the potential for renewable energy generation and associated employment benefits is scheduled to commence in mid 2000. The North West Development Agency is also involved in a review of its procedures to tackle dereliction, with the aim of improving the rate at which the region remediates it stock of derelict land.
The North West also has some acknowledged leaders in the realm of corporate social responsibility. Through social reporting, community involvement, ethical purchasing policies and stake-holder dialogue a number of larger North West companies have generated real market opportunities. Again however, this has not filtered through to the SME sector.
It is increasingly possible to de-couple economic growth and adverse environmental impacts. Through massive improvements in ‘eco-efficiency’, business in the North West has the potential to boost economic growth whilst simultaneously reducing its environmental impacts. The target sectors identified in the Regional Strategy for example are inherently more environmentally sustainable than the current mix of energy and resource intensive industries found within the region. With improved assistance on environmental management and corporate social responsibility businesses in the North West can help to bring economic, social and environmental benefits to the region. In terms of long term economic sustainability it is essential that the Programme facilitates restructuring that will enable the region to exploit growing global markets and to maximise the opportunities and minimise the threats that long
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range, intractable and extraneous issues such as globalisation, the spread of ICT, expansion of the European Union, demographic shift and climate change present.
The location of new business developments is a critical factor in determining their sustainability. For example, the scale of environmental impact associated with new development will be greatly influenced by its accessibility, the mode of transport used to access it and the ecological and landscape value of the site on which it is located. In terms of linking with opportunity and need, social benefits that can accrue from new developments can be lost if sites are peripheral and inaccessible to excluded communities. This Programme will ensure that new developments are located close to and are readily accessible to communities of need through high quality public transport links. Site selection will encompass environmental criteria such as landscape and ecological value. There will be a very strong presumption against supporting actions that do not meet these specifications. The Programme will also apply a sliding funding scale, offering a lower level of support to successful actions that score badly from a sustainability perspective.
Engaging deprived communities and involving them in the economic mainstream and enabling them to improve the quality of their local environments is crucial to creating a more sustainable region. This programme will support a number of initiatives which will enable people within deprived communities to take an active part in tackling issues such as crime, poor health, employability and dereliction. This will help to equip individuals with new skills, provide ladders to employment and enable them to improve the quality of their local environment.
Strategic Objective
This Priority will ensure that all of the SPD Priorities and Measures take account of the need to support sustainable development as a cross-cutting theme. This is to ensure that the broad thrust of the SPD reflects the social, economic and environmental priorities of the North West and that it pursues these priorities in a harmonious manner. There is a growing realisation at European, national and regional levels that competitiveness and quality of life are determined by a combination of social, economic and environmental factors. It is essential therefore that economic growth generated by the programme facilitates greater social inclusion and progress and results in a net improvement to the environment. If this is not achieved then the programme will not contribute to the removal of (and may actually add to) the manifold social and environmental problems that reduce regional competitiveness and quality of life.
Whilst sustainable development is concerned with the pursuit of economic and social aspirations as well as environmental, this priority will pay particular regard to environmental considerations as these have been inadequately addressed in previous programmes. The integration of environmental concerns into the Programme will aim to ensure that adverse environmental impacts are minimised, environmental problems are tackled and that opportunities arising from a high quality environment, and the demand for environmental technologies and services are fully utilised.
Programme Objective
The Programme objective for sustainable development is:
“To ensure that the 2000-2006 Objective 2 programme pursues economic growth, social progress and protection and enhancement of
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the environment simultaneously, and that economic growth does not occur in a socially exclusive or environmentally damaging manner”
Implementing The Strategy
Achievement of the objective will be pursued through:
1. Appraisal and Selection Criteria: all project applications will be required to address agreed gateway criteria which cover the minimum expectations of an application. Once passed the initial gateway assessment, applications which prioritise activities with positive environmental benefits or incorporate measures to ensure long term sustainability will be accorded additional marks in the scoring system.
2. Sustainable Development Advisory Group: It is proposed that the day-to- day implementation of the Sustainable Development Priority be overseen by a dedicated Advisory Group, which will be a sub-group of PAG. The Group will comprise between 6 and 10 individuals with extensive experience of environmental management and the relationship between economic development and broader sustainability. The responsibilities of the Group will include:
· Endorsement of the sustainability guidance, including annual updates · Facilitating workshops and advisory sessions for project sponsors · Provision of ad-hoc advice and support on technical aspects of individual project applications, where necessary · Monitoring of progress towards the Sustainability targets and reporting to the PMC · Monitoring of developments in the Sustainability field including technical specifications, skill requirements, policy context and providing an assessment of the implications for the Objective 2 programme as appropriate.
3. Guidance and Support for Project Applicants
In order that project sponsors are fully equipped to address the challenges set by the Sustainable Development Priority in relation to project design and implementation, a comprehensive range of guidance and support is required. An Sustainable Development guidance paper will be prepared explaining, inter alia, the gateway and scoring criteria, the policy context, potential activities and methods of monitoring and evaluation. Where appropriate, the guidance will be illuminated by previous examples of good practice from within the North West as well as other Structural Fund programmes.
The written Sustainable Development guidance will be supplemented by a programme of workshops and seminars for project sponsors, tailored to suit the needs of different types of sponsors (e.g. business support agencies, community development organisations). The number and location of workshops will be responsive to the demands of project sponsors.
Ongoing advice and support will be available from a nominated Sustainable Development officer in the European Secretariat. Where appropriate, the officer will be able to draw upon the expertise and advice of the Advisory Group in meeting the needs of project applicants.
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Appraisal and selection criteria
All applications will be subject to an initial gateway assessment in order to ensure that their content and likely impact are consistent with, and do not detract from, the objective of the Sustainable Development priority. The gateway assessment will ensure that all applications have reached a minimum standard, which is over and above merely complying with relevant legislation. Nonetheless, it is envisaged that the majority of applications will address the criteria readily, and many will be of a standard far in excess of the minimum requirements. Such applications will have an opportunity to attain recognition for this standard on the scoring system.
Where an application does not meet the requirements of the gateway criteria, extensive support and advice will be made available to address identified weaknesses. Although challenging, it is not intended that the gateway assessment be overly onerous for project sponsors, rather that it acts to encourage good practice in project design and implementation. Detailed guidance on incorporating environmental and sustainability considerations in project applications will be made available by the Secretariat.
The gateway criteria will comprise:
- For all projects, confirmation that all UK and EU environmental legislative requirements have been complied with;
- For all projects, confirmation that appropriate sustainable development targets have been set, and that robust monitoring and reporting arrangements have been put in place
- For capital projects, evidence that steps have been taken to ameliorating any potential negative environmental effects
- For capital projects, confirmation that energy and waste minimisation principles have been incorporated into the design of facilities
- For capital projects, confirmation that sufficient provision has been made for public and business access including identification of appropriate accompanying measures such as additional car parking, public transport
- For new and upgraded attractions and facilities, confirmation that account has been taken of the need to encourage or support access by public transport
- For revenue projects, confirmation that beneficiary SMEs will be made aware of appropriate support on introducing environmentally friendly practices, if not already provided within the project
In addition to the gateway criteria, additional scores will be available in the scoring system to projects which embody sustainable development principles.
The criteria for each of the measures in the three Priorities, including a brief rationale, are outlined below. Further details will be provided in the Sustainable Development guidance.
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Priority One: Business and Ideas
This priority will enable SMEs in the North West to maximise the opportunities and minimise the threats that sustainable development presents. It will aim to assist business growth and development in a way which facilitates social progress, minimises adverse environmental impacts and maximises potential environmental improvements. Through pursuing target growth sectors identified in the Regional Strategy, the Programme will assist the shift away from resource, waste and energy intensive sectors.
Priority 1 Business and Ideas Sustainability Criteria Criterion Measure Support new start ups in environment related products 1.1 Provisions of environmental business support services to SMEs e.g 1.1, 1.3..14 waste management Target support on SMEs specialising in environment related 1.2, 1.4 products and processes Support for businesses to undertake energy, waste and resource 1.1,1.2 reviews and audits Target finance on SMEs in environmental-related sectors 1.3 Schemes which assist the development of new environmental 1.4 technologies or demonstrate environmental management techniques Building design incorporating energy efficiency and use of recycled 1.5 materials Reuse of redundant buildings 1.5
Priority 2: People and Communities
Promoting an inclusive and vibrant society is an essential part of sustainable development. This is particularly evident in the North West where social problems such as crime, poor health and low educational attainment levels seriously reduce regional competitiveness and the quality of life of its inhabitants.
Priority 2 People and Communities Sustainability Criteria Criterion Measure Encouragement of businesses to engage in local self-sufficiency 2.1 e.g. recycling Development of local supply chains, “buy local” schemes and 2.1 local economic trading schemes Employment support to individuals linked to the provision of goods 2.2 and services that are needed in the local community. Provision of ICTs to facilitate distance learning and home working, 2.3 reducing the need to travel Facilitate community participation in maintaining their local 2.4 environment Projects re-using redundant buildings and derelict land 2.4 Develop community devised and implemented solutions to local 2.5 problems
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Priority 3: Strategic Regional Investment
This priority will aim to generate investment decisions that are based on opportunities that maximise social, economic and environment benefits simultaneously. This will help to avoid the conventional trade off between social, economic and environmental issues that frequently sees economic gains being made at the expense of environmental and social disbenefits. Sustainable development criteria will be of particular relevance to project selection and appraisal for Measures 3.1 and 3.2.
Priority 3 Strategic Regional Investment Sustainability Criteria Criterion Measure Re-use of brownfield land made ready for development 3.1,3.2 Re-use of redundant, derelict buildings 3.1,3.2 Enhancement of the local environment 3.1,3.2 High degree of fit with local landscape character, built 3.1,3.2 heritage Actions to reduce potential environmental impact of visitors 3.2 Degree of integration between public transport initiatives 3.3 Provision of adequate public transport 3.3 Potential reduction in congestion, use of car 3.3
Key Baseline Data
Progress towards the objectives of the sustainable development priority will be measured against the following indicators, updated where appropriate in the Programme Annual Report.
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BASELINE INDICATORS Indicator Value Source ENVIRONMENTAL SMEs in environmental technologies/services 500 AES Employees in environmental technologies/services 20,000 AES SMEs accredited to formal environmental management systems Recycled waste (tonnes, 1998) 847,000 Waterways classed as good/fair 87% Bathing waters meeting minimum EC standards (out 26 of 37, 1999) Air pollution days Number of listed buildings at risk 133 Level of unfit housing stock 9.7% 1999 SOCIAL % of working age population with no qualifications 20.3 1999 Coronary heart disease per 1000 patients 41.3/25. North West, 1999 (male/female) 6 Total number of notifiable crime offences annually 724,748 HO Individuals out of work for more than 2 years 7500 ONS Wards in worst 10% England 73 IMD ECONOMIC GDP per capita (% of UK average) 90.7 1996 Business formation rate (per 10,000 population) 34 % new businesses surviving more than 3 years 56.5 % of employees in high tech sectors 2.6 North West 1997 % of employment in fast growing sectors 35.3 AES % of employment in declining sectors 29.2 EAS % of workforce who are self employed 10.8 LFS % of businesses with a formal human resource 55 North West 1997 development plan
Output Targets By Priority Priority One: Business and Ideas
Priority 1 Business and Ideas Sustainability Targets Measure Target New start ups in environment-related sectors 1.1 350 Target support on SMEs specialising in environment related 1.2, 1.4 600 products and processes Support for businesses to undertake energy, waste and 1.1,1.2 700 resource reviews and audits Target finance on SMEs in environmental-related sectors 1.3 90 Schemes which assist the development of new 1.4 300 environmental technologies or demonstrate environmental management techniques Building design incorporating energy efficiency and use of 1.5 8 recycled materials Reuse of redundant buildings 1.5 8
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Priority 2: People and Communities
Priority 2 People and Communities Sustainability Targets Measure Target Encouragement of businesses to engage in local self- 2.1 300 sufficiency e.g. recycling Development of local supply chains, “buy local” schemes 2.1 20 and local economic trading schemes Employment support to individuals linked to the provision 2.2 1,500 of goods and services that are needed in the local community. Provision of ICTs to facilitate distance learning and home 2.3 33 working, reducing the need to travel Facilitate community participation in maintaining their local 2.4 150 environment Projects re-using redundant buildings and derelict land 2.4 100 Develop community devised and implemented solutions to 2.5 90 local problems
Priority 3: Strategic Regional Investment
Priority 3 Strategic Regional Investment Sustainability Targets Measure Target Hectares of brownfield land made ready for 3.1,3.2 250 development Number of redundant, derelict buildings 3.1,3.2 50 Number of public transport initiatives 3.1.3.2 40 Number of initiatives to enhance the local 3.1,3.2 50 environment
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4. TECHNICAL ASSISTANCE
Introduction and Rationale
In line with Article 23 of the Council Regulation (EC) No 1260/1999 laying down the general provisions of the Structural Funds, the North West SPD has earmarked euro 10.867 million ERDF in the fully eligible areas and euro 2.717 million ERDF in the transition areas for Technical Assistance. Such activities incorporate research, evaluation, management, administration and publicity activities. The objectives of the Technical Assistance Priority are:
· efficient and accountable management of the Programme;
· maximising the quality of Programme implementation and its impact; and
· ensuring information about, and publicity for, the Programme both within and outwith the North West.
The Technical Assistance Programme for the Objective 2 Programme will be split into 2 measures reflecting Commission Regulations (Rules 11.2 and 11.3). Within these measures activity will be divided between Core Activity and Non Core Activity.
Regulatory and Policy Context
Rules 11.2 & 11.3 of the regulations produced by the Commission sets limits on the amount of Technical Assistance (TA) resources which can be used to part fund costs incurred in the management and implementation of the Structural Funds:
· 11.2 – General Management, Monitoring & Financial Control
· 11.3 – Promotion & Evaluation of the Programme
Strategy and Delivery
From the previous Programme the North West Partnership has developed considerable experience in using Technical Assistance to enhance the impact of Structural Funds in the North West. This was achieved through the former Objective 2 Programmes (Greater Manchester Lancashire & Cheshire [GMLC] and the West Cumbria & Furness [WC&F]), the Objective 3 & 4 Regional Programmes, and the Northern Uplands Objective 5b Programme.
Building on the experience gained from old programmes the GO has developed a Technical Assistance Strategy incorporating mechanisms for raising the match funding, which has been considered by the Programme Monitoring / Regional Committee at its first meeting.
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The Technical Assistance programme has been divided into Core and Non Core activities.
Core Activity has been defined as:
“Those activities that assist in the efficient and effective management of the Objective 2 programme, where no one sector or geographical region will gain disproportionately from these activities”
Activity that falls outside the pre defined core activities include:
- the management arrangements put in place by the regional partners - sectoral management arrangements - activities which will benefit certain partners disproportionately
Match funding for Technical Assistance core activity will be raised through the introduction of a a mangement contribution.The grant element of ALL successful ERDF applications will be used to calculate the management contribution, however payment of the contribution must be provided from the applicants own funds.. The match funding for non-core activities will be expected to be from applicant resources.
Measure: General Management, Monitoring & Financial Control (Rule 11.2)
Including activities outlined below:
· Committee Services · Programme/Project Management and Appraisal · Financial Management
Committee Services – Will Include
· To establish decision-making bodies for the North West Objective 2, and Community Initiative Programmes.
· To ensure the effective servicing of the various decision-making bodies of the North West European Structural Fund Programmes 2000 – 2006:
· ensuring appropriate notification for meetings · set up systems and procedures for effective management of meetings · arranging and co-ordinating Agenda and Briefing meetings · preparation and issue of Agenda/supporting papers · preparation of procedural reports · attendance at meetings · preparation and issue of Minutes
· To make arrangements and provide the secretarial service for negotiations and meetings between Regional Partners, Headquarter colleagues and the Commission on the North West Objective 2 Single Programming Document.
· To assist with the preparation of the Technical Assistance Strategy for the Objective 2 and 3 Programmes.
· Informing and advising Chairs of meetings and other relevant GO staff/Regional Partners on delivery and procedural advice for the various Programme Committees.
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· Development and management of Regional Partners Committee database
· Management responsibility for: secondees and/or administrative staff as required.
Programme/Project Management and Appraisal – Will Include
· appraise ERDF projects and Action Plans · make recommendations based on appraisal · where necessary visit applicants/project site · advise applicants on ERDF issues e.g. eligibility · consider requests for changes to projects · detailed working up, appraisal and negotiation of ERDF grant applications
Financial Management – Will Include
· provision of financial advice and guidance on Project Applications · set up and implement project/action plan monitoring strategy · the development and introduction of a Government Office integrated management information system for the European Structural Funds Programme 2000 –2006. · provide summary financial information and analysis of the Programme to inform the appropriate Committees/Groups etc. · provide strategic advice and guidance to the Government Office and the Regional Partners when problems occur within the programme · provide Accountancy advice as required to all aspects and sections of the European Programme within the Government Office · to ensure robust management arrangements are being employed by the Regional Partners · management of the Technical Assistance budget for Objective 2 and Objective 3 on behalf of the Government office · management responsibility for: secondees and/or administrative staff as required · to advise the European Programme Secretariat on the efficiency and effectiveness of its own financial management and monitoring arrangements
Regional Partner Management Arrangements
Action Plan Partnerships (APP) Local Implementation Plans (LIP) European Liaison Units (ELU)
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Measure: Promotion & Evaluation of the Programme (Rule 11.3)
Including activities outlined below
· Publicity · Studies/ Evaluations · Exchange of Best Practice · ERDF Database Development
Publicity – Will Include
A detailed outline of the publicity programme for the 2000 – 2006 programme can be found in the Communication Plan element of the Programme Compliment, below is a brief summary of some of the areas of activity covered:
· Production and dissemination of publicity materials such as:
· brochures · leaflets · posters · newsletter e.g. “At Home In Europe” · display materials · detailing funding available and how to access it – to include the development of · a ‘Good Parctice Guide’.
· Development, management and updating of new SPD website and the European Commission’s NW website · Production of Audio-Visual Publicity material · The issue of Press Releases, in conjunction with COI, reflecting achievements and announcements of the Programmes · Co-ordination and development of advertorials detailing the achievements of the programme: raising awareness and targeting potential beneficiaries · The organising of awareness raising conferences as and when appropriate · General networking and liaison with Media and Partners in order to maximise awareness of the Programme and its positive impact · The development of closer working links with the EC, both in Brussels and London, and with the NWRA and NWDA
Studies/ Evaluations – Will Include
· The Technical Assistance budget will be used to conduct Programme wide studies, such as the Mid Term Evaluation of the objective 2 Programme, Feasibility studies, etc. and Programme evaluations throughout the lifetime of the Programme. The commissioning of external organisations/bodies in accordance with HMG’s contracting rules and regulations will do this.
· Where studies and investigations are locally based the payment for such studies will be met from Regional Technical Assistance applications the match funding for which will be provided by the applicant and not from the core match funding levy.
Exchange of Best Practice – Will Include
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· The Technical Assistance budget will be used to ensure that the programme takes advantage of examples of best practice being employed by other Structural funds Programmes throughout the UK ensuring the 2000 – 2006 Objective 2 and Objective 3 Programmes is as effective as possible.
ERDF Database Development – Will Include
· The Technical Assistance budget will be used to maintain and develop the ERDF Database to ensure the information required for programme monitoring and management is accurate.
136 Technical Assistance Strategy ______North West of England Objective 2 Programme Complement ______
Financial Allocation
Total Budget ERDF Euro 000's Measu Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Total Match Total re Grant Funding Cost 11.2 590.49 1,009. 1,375. 1,555. 1,759.3 1,992.6 2,259. 10,54 10,542. 21,084. 37 38 20 2 0 90 2.26 26 52
11.3 265.68 463.32 417.96 439.02 461.70 484.38 508.6 3,040. 3,040.7 6,081.4 8 74 4 8
Total 856.17 1,472. 1,793. 1,994. 2,221.0 2,476.9 2,768. 13,58 13,583. 27,166. 69 34 22 2 8 58 3.00 00 00
Fully Eligible Area Euros 000's Measu Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Total Match Total re Grant Funding Cost 11.2 454.68 777.21 1,059. 1,197. 1,354.6 1,992.6 2,259. 9,095. 9,095.6 18,191. 04 50 8 0 90 62 2 23
11.3 204.57 356.76 321.83 338.05 355.51 484.38 508.6 2,570. 2,570.7 5,141.5 8 77 7 5
Total 659.25 1,133. 1,380. 1,535. 1,710.1 2,476.9 2,768. 11,66 11,666. 23,332. 97 87 55 9 8 58 6.39 39 78
Transitional Area Euros 000's Measu Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Total Match Total re Grant Funding Cost 11.2 135.81 232.16 316.34 357.70 404.64 1,446. 1,446.6 2,893.2 64 4 8
11.3 61.11 106.56 96.13 100.97 106.19 470.9 470.97 941.94 7
Total 196.92 338.72 412.47 458.67 510.83 1,917. 1,917.6 3,835.2 61 1 2
137 Technical Assistance Strategy ______North West of England Objective 2 Programme Complement ______
5. COMMUNICATION PLAN
Introduction
The European Secretariat for Government Office North West will be undertaking a programme of information and publicity activity, in accordance with Commission Regulation (EC) No 1159/2000 on information and publicity measures to be carried out by the Member States concerning assistance from the Structural Funds.
This Communications Plan sets out the framework for that activity, and is consistent with the strategy outlined in the SPD
Aim
The Objective 2 Communication Plan for the North West aims to:
Promote a positive image of the Objective 2 programme throughout the North West, of the European Structural Funds and an understanding of the European Union.
Objectives
· To maximise the benefits of the Objective 2 Programme in the North West
· To promote funding opportunities offered by the European Union by providing clear information and disseminating best practice regarding the Objective 2 Programme in the North West.
· To raise public awareness of the role of the European Union in regional development in the North West through European Structural Funds.
· To aid the transparency of the operation of the Objective 2 Programme.
Target Audience
The publicity and information measures will raise public awareness, provide transparency and inform the following groups of the opportunities offered by the European Union via the Objective 2 programme.
· Potential and final beneficiaries · Project operators and promoters · Regional and local authorities and other public authorities · Trade and professional bodies · Economic and social partners · Non-government organisations, especially bodies promoting equality of opportunity, and bodies working to protect and improve the environment · General public
Publicity and information activity will be aimed at individual segments, groups or all of the target audience. The method of communication will be determined by the nature of the message.
Strategy
138 Communication Plan ______North West of England Objective 2 Programme Complement ______
The strategy is designed to address the following requirements:
· To encourage involvement of new partners and project sponsors in the programme and provide support to new applicants.
· To provide a wide range of guidance and support to project sponsors using a range of medium eg. written, electronic, seminars and workshops.
· To keep partners, project sponsors and the public informed with regard to all aspect of the Programme.
· To assist and ensure project sponsors fulfil the requirements placed on them related to signage and acknowledgement.
The strategy will incorporate the use of a range of communication mechanism with the key element being the continuing development of the SPD website. Together with more conventional means such as press releases and promotional events, the strategy will aim to keep partners and people in the region up to date with the investment made through the Programme and with examples of good practice.
Publicity Officer
A nominated publicity officer will be responsible for implementing the Communications Action Plan and liaising with the European Commission This will include alerting the regional and national press, radio and television at the time of the programme approval and at the main phases of implementation.
Communication Tools
Publicity of the SPD and Programme Complement
The Objective 2 Single Programming Document and the Programme Complement are extremely detailed, with much of the information not relevant to the majority of those interested in the Programme. To assist individuals and organisation develop an understanding of the Programme, its aims and objectives, and the types of activities it will support, great emphasis will be placed on making the programme accessible and user friendly.
Website
The Government Office North West European Secretariat website www.nwpost99 was introduced primarily to facilitate the consultation process of the Single Programming Document 2000 – 2006. In this time the website has been widely praised for its depth of information. Due to the rapid growth of Internet access for individuals, businesses and other organisations the website is currently being developed to meet the demands for the effective delivery of the programme. The website will become the main communication tool. The objectives of the website will be to:
· Maximise the benefits of the programme
· Allow easy access of information about all aspects of the Programme.
139 Communication Plan ______North West of England Objective 2 Programme Complement ______
· Modernise and make more transparent information delivery.
· Provide links to other relevant organisations and bodies, including the European Commission.
The website will facilitate efficient and effective communication with the target audience, with the latest information and documentation available quickly. It is envisaged that the content of the website will augment, as more information becomes available
It is realised that not all of the target audience will have access to the Internet and information will be available in other formats to those without internet access.
Target audience: All
Dissemination of Best Practice
To maximise the opportunity to share best practice, it is proposed that regular contact is continued with other European Secretariat to facilitate the exchange of information. Full utilisation will be made of the Objective 2 Programme website to aid the process.
Media Relations
Regular contact between the Communications Officer and the media will be continued. In addition spokespersons will be identified to speak to the media on defined areas. Media relations activities will include:
· Issuing press releases for newsworthy developments in the Programme · Seeking radio and television opportunities · Press Packs · Features in Newspapers and Magazines
Nominated Spokesperson(s)
It is the intention of the Partnership to identify key spokespersons, within regions and sectors, to be made available for comment to regional and national media.
Crisis Management
A crisis management team could be established in order to deal with any adverse publicity.
Target audience: the general public, trade and professional bodies, NGOs
Newsletter
Currently a newsletter is produced periodically. ‘At Home in Europe’ features case studies and updates from the Secretariat. It is the intention to review the content and targeted group to produce a newsletter that more meets the needs of the target groups. Initially the newsletter will be available in hard copy and on the website. Readership will be monitored closely and delivery mechanisms revised to reflect findings.
Target audience: Project sponsors, potential project sponsors, partners, regional and local authorities
140 Communication Plan ______North West of England Objective 2 Programme Complement ______
Support for Project Sponsors
Applicant Guidance
The complexity of the Structural Funds can act as a barrier to new organisations and a disincentive for existing partners. Therefore guidance notes to support the application process will be prepared and circulated widely amongst existing and potential project sponsors.
Guidance will cover areas such as:
· Eligibility of applicants · Eligibility of activities · Application procedures and processes · Scoring and appraisal system · Management and decision making structures · Monitoring requirements and responsibilities · Claims procedures · Publicity requirements
Publicity Guidance Packs
Project sponsors offer an excellent opportunity to promote the Objective 2 programme. A publicity pack giving details of promotional requirements, branding guidelines and media information will be issued to all successful applicants encouraging the widest possible use of European emblems, plaques and communications for each of the relevant Funds.
The Secretariat will take responsibility for ensuring that project sponsors adhere to the guidelines. Project sponsors will have to agree to meet the publicity requirements as a condition of the grant
Target audience: Project sponsors and potential project sponsors
Audio Visual Material
Videos – during the life of the Programme it may be appropriate to develop videos to add an interesting dimension to the promotion of the projects taking place in the region.
CD Rom – with the increase in use of new media, CD rom could provide an excellent medium for communicating best practice
Target audience: General public, project sponsors and potential project sponsors, and partners
Events, Seminars and Briefings
141 Communication Plan ______North West of England Objective 2 Programme Complement ______
It is envisaged that seminars and workshops will be organised by Priority, fund or sector including ones aimed at exchanging best practice, as and when appropriate. The number of events will be determined by demand and/or identifiable need,.
Target audience: the general public, project sponsors and potential project sponsors
Promotional Items
Promotional items will be developed and used where necessary. Items such as display stands, pens, posters, flyers and promotional literature can be used to promote individual events, aspects of the Programme and/or the Programme as a whole. Display stands will be made available for Partners to hire for events.
Target Audience: All
Leaflets and Brochures
Where necessary leaflets and brochures may be produced and made available in both paper and electronic format.
Monitoring and Evaluation
The European Secretariat will be responsible for collating statistics with regard to the various elements of the Communications action plan. Standard indicative measurements are both quantitative and qualitative.
Quantitative Measures
Some of the measures may include:
Evaluation Criteria Target (per annum) Number of newletters produced per annum 3 Guidance Notes produced by topic 10 Requests for partners on progress videos 30 Press releases issued 12 Publicity enquiries 500 Number of events attended 12 Project guidance workshops 12 Partner organisations accessing website in Year 1 75% Website hits tbc
Data will be collected regularly to facilitate compilation of the information and publicity section of the Annual Implementing Report to the PMC and for submission to the European Commission for its Annual Report
*Currently there is no baseline target
Qualitative Targets
· Customer attitude survey · Recall of publicity material · Rating of quality of publicity material · Rating of helpfulness of publicity material
142 Communication Plan ______North West of England Objective 2 Programme Complement ______
· Rating of satisfaction with information, advice and correspondence
In addition the COI will monitor press and media coverage
An annual report on Publicity and Information activity will be provided to the Programme Monitoring Committee and made available upon request
Budget
Indicative spend over the period of the programme as defined within the Technical Assistance Budget is as follows:
Budget (£m) Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 2000 2001 2002 2003 2004 2005 2006 2007 2008 80000 84000 50000 52500 55125 57881 60775 10000 10342
Total Spend £461000
143 Communication Plan ______North West of England Objective 2 Programme Complement ______
6. CO-FINANCING STRATEGY
Introduction
This section of the Programme outlines the co-financing sources that will be used to implement the Programme. Sources of co-financing are presented by Measure. It should be noted that the strategy presents the principal sources of finance, and not an exclusive list. It should also be noted that new initiatives are likely to lead to new sources of public finance being made available over the life of the Programme. This co-financing strategy should therefore be considered as indicative.
It is not possible to determine the precise financial contribution of each partner organisation, since this partly depends on the project selection system that prioritises those projects that offer the best value, appraised against a broad set of criteria. As the outcome of the appraisal process is unknown, it is not possible to determine in advance how much each partner organisation or sector will contribute to each measure and Priority expenditure.
It should also be noted that the co-financing identifies the source of monies, as distinct from project sponsors. Although these can be one and the same, in many instance organisations will provide co-financing to intermediaries such as community and voluntary sector organisations and business development organisations.
As with previous Programmes the principle sources of public sector co-financing will be central Government, through national Departments and the Government Office for the North West, the Local Authorities, along with two new organisations – the North West Development Agency and the Small Business Service. Given that the new Programme is ERDF only, it is likely that Further and Higher Education will play a lesser, but still very important role with regard to co-financing, compared to the previous Programmes where a significant component of support was provided via the European Social Fund.
Business and Ideas
This Priority will provide support to improve the competitiveness of existing business, and to develop new and higher growth sectors. It is envisaged that a wide variety of partners and sources of co-financing will contribute to the successful implementation of the measures.
Measure 1.1, the Creation and Establishment of Entrepreneurial Business Starts will be co-financed primarily by the Small Business Service, the North West Development Agency, the Local Authorities, the Government Office for the North West, the Department of Trade and Industry, business and economic development agencies and enterprise trust and the private sector.
Measure 1.2, Increasing The Competitiveness of Established SMEs will be co- financed primarily by the Small Business Service, the North West Development Agency, the Local Authorities, the Government Office for the North West, the Department of Trade and Industry, business and economic development agencies and enterprise trust and the private sector.
Measure 1.3, Access To Investment Finance for Growth SMEs will be co- financed primarily by the Small Business Service, the North West Development Agency, the Local Authorities, the Government Office for the North West, the
144 Co-Financing Strategy ______North West of England Objective 2 Programme Complement ______
Department of Trade and Industry, business and economic development agencies and enterprise trust and the private sector.
Measure 1.4, Developing The Regional Knowledge Economy: Supporting Business Innovation and Networking will be co-financed primarily by the Small Business Service, the North West Development Agency, Higher and Further Educations Institutions, the Local Authorities, the Government Office for the North West, the Department of Trade and Industry, business and economic development agencies and enterprise trust and the private sector.
Measure 1.5, Investment In Premises for New and Expanding SMEs will be co- financed primarily by the North West Development Agency, the Local Authorities, business and economic development agencies and enterprise trust and the private sector.
People and Communities
This Priority will provide comprehensive support to communities and individuals most in need in order to ensure that all sections of society have access to training and employment opportunities.
Measure 2.1 Developing Enterprise and Employment Opportunities will be co- financed primarily by the Local Authorities (using a number of sources including SERB and Urban Renewal Funds), the North West Development Agency, the Department of the Environment, Transport and the Regions, the Government Office for the North West, the Small Business Service, Charities and Charitable Foundations, National Lottery Funds, Further Education Institutions.
Measure 2.2 Improving Access To Employment will be co-financed primarily by the Local Authorities (using a number of sources including SERB and Urban Renewal Funds), the North West Development Agency, the Department of the Environment, Transport and the Regions, the Government Office for the North West, Charities and Charitable Foundations, National Lottery Funds, Further Education Institutions.
Measure 2.3 Developing An Inclusive Information Society will be co-financed primarily by the Local Authorities (using a number of sources including SERB and Urban Renewal Funds), the North West Development Agency, the Department of the Environment, Transport and the Regions, the Government Office for the North West, Charities and Charitable Foundations, National Lottery Funds, Further Education Institutions
Measure 2.4 Connecting Communities will be co-financed primarily by the Local Authorities (using a number of sources including SERB and Urban Renewal Funds), the North West Development Agency, the Department of the Environment, Transport and the Regions, the Government Office for the North West, Charities and Charitable Foundations, National Lottery Funds.
Measure 2.5 Building Economically Sustainable Communities will be co-financed primarily by the Local Authorities (using a number of sources including SERB and Urban Renewal Funds), the North West Development Agency, the Department of the Environment, Transport and the Regions, the Government Office for the North West, the Small Business Service, Charities and Charitable Foundations, National Lottery Funds, Further Education Institutions.
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Strategic Regional Investment
This priority will create the infrastructure to allow the region to benefits from substantial new investment and at the same time provide assistance to ensure that the benefits are made available to both disadvantaged communities and the wider SME business base.
Measure 3.1 Developing Strategic Employment Opportunities will be co-financed primarily by the North West Development Agency, the Local Authorities, the Government Office for the North West, the Department of the Environment, Transport and the Regions, the private sector.
Measure 3.2 Maximising the Economic Potential of the North West’s Natural, Cultural and Other Heritage Assets will be co-financed primarily by the North West Development Agency, the Local Authorities, the Government Office for the North West, the Department for Culture, Media and Sports, National Lottery Funds (Heritage), English Heritage, English Nature, the private sector.
Measure 3.3 Connecting With Communities In Need will be co-financed primarily by the North West Development Agency, the Local Authorities, the Government Office for the North West, the Department of the Environment, Transport and the Regions.
146 Co-Financing Strategy ______North West of England Objective 2 Programme Complement ______
7. PERFORMANCE RESERVE
A new feature of the 2000-2006 round of Structural Fund programmes is the introduction of a performance reserve, which aims to “reward” those Programmes which demonstrate efficiency and effectiveness with an additional allocation of EU monies of up to 4% of the original SPD allocation. If awarded, the additional EU monies are made available for the final three years of the Programme i.e. 2004-2006.
The assessment as to whether the performance reserve is awarded is made at the end of 2003, against an agreed set of Effectiveness, Financial and Management criteria. Indicators and targets for Financial and Management criteria are set out in the SPD, and summarised below for reference.
Effectiveness criteria cover core output and result indicators for each of the three Priorities in the North West programme. Indicators selected are required to cover at least 50% of the value of the Programme. The SPD sets out these indicators and the Programme Complement is required to set targets against them. These are set out in the table below. The targets have been set using a methodology which takes account of the implications of the delayed commencement of the Programme for making financial commitments and the likely time-scale for the delivery of projects on the ground and the achievement of results.
Performance Reserve Effectiveness Indicators and Targets Priority Priority Priority Total % of 1 2 3 Programme Target Outputs SMEs assisted 4,000 555 - 4,555 23 Start-up SMEs assisted 1,700 44 - 1,744 23 Capacity building projects - 50 - 50 25 ICT Learning Centres - 8 - 8 27 Ha land prepared - - 80 80 16 Sqm of floor space constructed 40,000 5,000 9,940 54,940 20 Sqm of specialist hi-tech accommodation 8,000 - 2,040 10,040 20
Results Gross sales (£m) 570 27 300 997 11 Gross jobs 7,483 650 3,000 13,133 11 Firms introducing new practices/procedures 928 0 - 928 15 CED residents provided with training access - 2,000 - 2,000 20 Organisations participating in CED capacity building - 75 - 75 15
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8. COMPUTERISED EXCHANGE OF DATA
An agreement was reached with the Commission on 13 June 2000 with respect to arrangements concerning the computerised exchange of data between the United Kingdom and the Commission needed to fulfil the management, monitoring and evaluation requirements in accordance with Article 18(3) of Regulation 1260/99.
In respect of the financial tables associated with the Single Programming Document and the programming complement, the Managing Authority will provide these initially by spreadsheet. The Commission will provide a framework for EXCEL spreadsheets to facilitate the transfer of data onto their IT system. The UK will have access to this system for the programmes in question to check the accuracy of the data.
The Paying Authorities, that is the Government Office for the North West for the ERDF will make payment claims in the form of Table 8 of the Commission’s Vademecum, initially on spreadsheets according to the Commission’s framework.
Forecasts of payment claims will be presented by the Managing Authority for each of the Funds in the form of Table 9 of the Vademecum, again initially on spreadsheets.
The DETR for the ERDF will develop their computer systems to progress towards an electronic exchange of data in accordance with the technical specifications set out in the Commission regulation which lays down rules as regards the form and content of the information which must be available to the Commission for the purposes of checking Structural Funds’ accounts, yet to be adopted.
It is expected that the developments will be concluded according to the following timetable:
DETR: by end June 2001
These Departments will also make available to the Commission, when requested, the details of individual projects they currently record. They will develop their computer systems to record project level information set out in the Commission’s regulation referred to above.
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ANNEX A - PRIORITY 2 TARGETED WARDS
RURAL ALLOCATION
IMD FOR RPA WARDS IN OBJECTIVE 2 FULLY ELIGIBLE AREA
Index of Ward LA Name Multiple Population Deprivation Score
Distington Copeland 43.83 2400 Frizington Copeland 43.41 2600 Ellenborough Allerdale 40.39 4000 Clifton Allerdale 40.11 1600 Cleator Moor North Copeland 39.32 4600 Netherhall Allerdale 38.30 3100 Flimby Allerdale 34.27 1800 Howgate Copeland 33.51 3100 Alston Moor Eden 29.23 2200 Dalton South Barrow-in-Furness 29.20 5800 Gisburn, Rimmington Ribble Valley 14.70 1100 Bowland, Newton and Ribble Valley 13.02 800 Slaidburn
FULLY ELIGIBLE EXIT WARDS
Index of Ward LA Name Multiple Population Deprivation Score
Halliwell Bolton 45.70 12700 Fallowfield Manchester 45.16 14900 Lees Oldham 44.99 10500 Whalley Range Manchester 44.86 14400 Levenshulme Manchester 44.52 14200 Walkden North Salford 43.98 11700 Harbour Copeland 43.89 3400
149 Annex A ______North West of England Objective 2 Programme Complement ______
TRANSITION EXIT WARDS
Index of Ward LA Name Multiple Population Deprivation Score
Whitefield Pendle 73.93 4700 Daneshouse Burnley 71.48 6400 Central Hyndburn 69.22 5100 Bradley Pendle 66.96 5600 Bank Hall Burnley 64.44 5500 Barclay Burnley 62.24 4500 Church Hyndburn 57.36 6000 Waterside Pendle 55.76 4200 Spring Hill Hyndburn 54.2 6600 Brierfield Pendle 51.13 4400 Grange Halton 49.08 6800 Barnfield Hyndburn 46.41 3700 Wolverham Ellesmere 46.24 2700 Trinity Burnley 45.15 4700 Fulledge Burnley 43.81 5000 Vivary Bridge Pendle 42.88 5700 Talbot Trafford 42.88 8900
150 Annex A ______North West of England Objective 2 Programme Complement ______
WARDS IN WORST 8% FULLY ELIGIBLE AREA
Index of Ward LA Name Multiple Population Deprivation Score
Benchill Manchester 83.77 12000 Harpurhey Manchester 78.28 11600 Beswick and Clayton Manchester 77.58 11100 Bradford Manchester 76.63 11200 Ardwick Manchester 75.73 10600 Central Manchester 73.75 10500 Newton Heath Manchester 73.13 12000 Central Bolton 72.71 11600 Central and Falinge Rochdale 72.48 10900 Audley Blackburn with Darwen 71.51 8300 Gorton South Manchester 71.39 13300 Woodhouse Park Manchester 71.38 10900 Middleton West Rochdale 71.37 7500 Moss Side Manchester 71.01 13500 Coldhurst Oldham 70.82 12600 Werneth Oldham 70.45 11600 Shadsworth Blackburn with Darwen 70.23 6800 Alexandra Oldham 70.19 12000 Mirehouse West Copeland 70.13 2400 Sandwith Copeland 69.01 2700 Higher Croft Blackburn with Darwen 69.00 6800 Smallbridge and Wardleworth Rochdale 68.84 14200 Wensley Fold Blackburn with Darwen 68.81 7300 St Marys Oldham 68.59 11900 Longsight Manchester 68.48 18000 Central Barrow-in-Furness 68.22 5300 Shear Brow Blackburn with Darwen 67.87 7900 Queen's Park Blackburn with Darwen 67.81 6500 Broughton Salford 67.17 9900 Derby Bolton 66.46 13600 Little Hulton Salford 66.43 11100 Salterbeck Allerdale 66.19 2600 Castlefields Halton 65.98 6900 Brinnington Stockport 65.89 10500 Hulme Manchester 65.82 9800 Cheetham Manchester 65.69 15000 Blackfriars Salford 65.48 8800 Ordsall Salford 64.86 7500 Park Blackpool 64.78 7300 Norley Wigan 64.71 10100 Ewanrigg Allerdale 64.60 2700 Alexandra Blackpool 64.52 7000 Tanhouse West Lancashire 64.10 5300 Bastwell Blackburn with Darwen 64.05 7200 Fishwick Preston 63.71 6400 Risedale Barrow-in-Furness 63.66 5000 Claremont Blackpool 63.34 7900
151 Annex A ______North West of England Objective 2 Programme Complement ______
Pendleton Salford 63.30 9500 Lightbowne Manchester 62.92 12200 Ribbleton Preston 62.26 7400 Riverside Halton 62.26 6500 Hindpool Barrow-in-Furness 62.02 5300 Baguley Manchester 61.40 11800 Newbold Rochdale 60.86 10700 Langworthy Salford 60.52 9800 Blackley Manchester 60.49 12000 Kingsway Halton 59.67 6600 Alexandra Lancaster 59.47 5300 Sharston Manchester 59.02 10200 Digmoor West Lancashire 58.75 4600 Farnworth Bolton 58.54 13200 Clifford Trafford 58.46 11000 Deepdale Preston 58.39 7300 Barrow Island Barrow-in-Furness 58.21 3000 Westfield Allerdale 58.05 3600 Ashton St Peters Tameside 58.05 10200 Hollinwood Oldham 58.00 10000 Bucklow Trafford 57.99 8800 Middleton Central Rochdale 57.56 9400 Gorton North Manchester 57.51 13800 Moorside West Lancashire 57.45 4400 Westminster Ellesmere Port & Neston 57.36 3800 Charlestown Manchester 57.28 12200 Stanlow Ellesmere Port & Neston 57.01 3600 St James Oldham 56.77 8800 Ince Wigan 56.64 10800 Brimrod and Deeplish Rochdale 55.61 8800 Talbot Blackpool 55.47 6500 Brooklands Manchester 55.38 11600 St Matthew's Preston 55.07 7200 Foxhall Blackpool 54.98 6800 Grange Ellesmere Port & Neston 54.70 4800 Murdishaw Halton 54.55 5900 Brookfield Preston 54.10 6600 Balderstone Rochdale 53.93 10200 Northside Allerdale 53.48 1200 Pharos Wyre 53.47 3400 Hyde Godley Tameside 52.92 12000 Winton Salford 52.86 13000 Palace Field Halton 52.46 6800 Avenham Preston 52.12 6900 Newtown Wigan 52.01 11700 Burnage Manchester 51.56 14400 Ormsgill Barrow-in-Furness 50.80 6500 Moston Manchester 50.46 13200 Weaste and Seedley Salford 49.80 10000 Brookvale Halton 48.57 5200 Halton Brook Halton 48.51 7700 Crumpsall Manchester 48.28 13000 Northenden Manchester 48.46 12700 Mill Hill Blackburn with Darwen 48.06 6600 Sudell Blackburn with Darwen 47.94 6500
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Moorclose Allerdale 47.75 4000 Abram Wigan 47.36 12500 Tonge Bolton 47.12 10500 Central Ellesmere Port & Neston 46.65 4500 Barton Salford 46.55 10600 Cleator Moor South Copeland 46.41 2900 Brunswick Blackpool 46.05 7100 Norton Halton 45.96 6300 Heywood West Rochdale 45.88 9000 Rusholme Manchester 45.83 14400 Mersey Halton 46.75 6300 Birch Green West Lancashire 45.74 11700
153 Annex A ______