Great Western Powerhouse March 2019 A Powerhouse for the West July 2019 3 Waterhouse Square Elliot House 138 Holborn 151 Deansgate London EC1N 2SW Manchester M3 3WD 020 3868 3085 0161 393 4364 Designed by Bristol City Council, Bristol Design July 19 BD11976 Great Western Powerhouse March 2019 A Powerhouse for the West July 2019 CONTENTS EXECUTIVE SUMMARY 2 THE UK POLICY CONTEXT 8 DEVOLUTION AND THE EMERGING REGIONAL DIMENSION TO UK ECONOMIC AND INDUSTRIAL POLICY 10 INTERNATIONAL MODELS OF CROSS-BORDER COLLABORATION 15 GREAT WESTERN POWERHOUSE GEOGRAPHY 18 ECONOMIC STRENGTHS AND OPPORTUNITIES 30 WHAT THE GREAT WESTERN POWERHOUSE SHOULD BE AIMING TO ACHIEVE 44 c 1 A Powerhouse for the West July 2019 A Powerhouse for the West July 2019 EXECUTIVE SUMMARY The economic map of Britain is being reshaped by devolution and the • The Northern Powerhouse and the Midlands The economic geography emergence of regional powerhouses that can drive inclusive growth at scale, Engine have established themselves as formidable regional groupings driving economic The inner core of the region is the cross-border through regional collaboration But, there is a missing piece of the jigsaw in rebalancing and promoting trade and economic relationship between the two metro regions the West of Britain along the M4 from Swindon across the Welsh Border to investment through the internationalisation of of the West of England Region (including Bristol and Swansea, and the intersecting M5 axis, through Bristol, north to Tewkesbury their regions These powerhouses have been Bath) and the Cardiff Capital Region (including Cardiff set up to cover the whole geography of their The area has three established city regions, as well as plans for a new city and Newport) This was the economic area highlighted regions, albeit with major cities as their in the 2016 Metro Dynamics report But just as region, but no overarching powerhouse This report, commissioned by Bristol, agglomeration hubs And they have been ‘Man-Sheff-Leeds-Pool’ has been expanded into the Cardiff and Newport City Councils, is a response to that challenge The successful at attracting significant levels of Northern Powerhouse, and the original Midlands conclusion is that the Great Western cross border area is a powerhouse Government funding and investment as well as Connect case for linking Nottingham and Birmingham some core funding has been widened to include Lincolnshire and waiting to happen Staffordshire, so there is a strong case for considering • Meanwhile the British economy is being a wider geography for a Western Powerhouse The report builds on an earlier, exploratory, report reduced costs significantly for reshaped by Brexit, and global trends in This report affirms that there is a good case for a published by Metro Dynamics in 2016 that commuters and businesses industry and manufacturing are changing, powerhouse area that is connected from Swindon examined the case for a powerhouse around alike, it has also accelerating the need for determined and to Swansea by the M4 and Great Western Rail line Bristol, Cardiff and Newport There have been five accelerated cross- collaborative regional action to respond to the This area takes in an additional city deal area – key developments since this report was written: border four Grand Challenges of the Industrial the Swansea Bay City Deal – and at the other end, economic Strategy: Artificial Intelligence (AI) and data, Swindon1, historically the engine room of the Great • The West of England Devolution Deal, Cardiff connectivity clean growth, ageing society, and future of Western Rail Line, and now the gateway to the Capital Region City Deal and the Swansea Bay City between the mobility There are great strengths in advanced Cambridge-Milton Keynes-Oxford (CaMKOx) corridor Deal have all been implemented This is metro areas manufacturing in the West, but developments The critical intersecting north-south axis along the important, because one of the pre-conditions for a of the West of such as the closure of Honda at Swindon, the M5 and Cross Country Rail justifies the expansion of regional powerhouse is for it to be based on England and planned closure of the Ford engine plant at the area from Weston-super-Mare to Tewkesbury strong metro city governments, who can then the Cardiff Bridgend and the termination of the A380 choose to collaborate at a city level It is cities Capital Region programme at Airbus in Filton highlight just As the detailed commuter data in the report shows, that are driving growth globally, but this can how fast industry is now changing Mobilising this is already a highly interconnected area, be accelerated by metro areas opting to the region’s strengths in advanced characterised by polycentric agglomeration, which collaborate through city regions manufacturing so that they can respond to the meets the Organisation for Economic Co-operation new opportunities of the Fourth Industrial and Development (OECD) preconditions for a • The Gloucestershire Vision 2050 Revolution has never been more important functional region report has proposed the establishment of a new city region connecting This new report from Metro Dynamics Gloucester, Cheltenham and Tewkesbury, by builds on these developments, regenerating land between the urban revisits the economic centres The Central Gloucestershire geography of the cross-border City Region could grow to a region (in light of what we now population of 520,000 by know about the Northern 2050 This underlines the Powerhouse and the Midlands Cheltenham extent to which this region Gloucester Engine), and most importantly, has a dynamic, growing outlines what a powerhouse for Swansea Newport economy, driven not just by Swindon the West should do, and how it Cardiff Bristol should be developed For the purposes existing city regions, but also by the Bath potential for a new one of this report we term the powerhouse, the ‘Great Western Powerhouse’, notwithstanding • As of December 2018 tolls have future discussions and agreement on been removed from the Severn the brand Bridge, which has not only 2 1 Swindon is defined as a city by the Centre for Cities 3 A Powerhouse for the West July 2019 A Powerhouse for the West July 2019 Economic strengths and And two high growth sectoral opportunities: A plan for Britain’s next Key facts about the region opportunities • Clean energy and low carbon – the region has Powerhouse particular strengths in renewable energy, tidal 4.4m population – similar in size The region is a major economic powerhouse, The Great Western Powerhouse is a powerhouse and marine energy, as well as nuclear energy, to the Greater Copenhagen-Skåne containing some very high performing areas, such waiting to happen This is not about economic which represent important growth opportunities region (linking cities in Denmark as Bristol and Bath and the surrounding West of rebalancing so much as tapping into the potential and Sweden) to turbo-charge growth that will benefit the UK as England, and the Cardiff Capital Region As a • Health and life sciences – the second Life a whole In the post-Brexit world, export-based major arteries run across the whole, it has a higher GVA per head than the Sciences Sector Deal refers to ‘The Great West’ 2 growth will be critical and the region has the entirety of the region – the M4 and Northern Powerhouse and the Midlands Engine, opportunity for growing life sciences, linked opportunity to lead this, competing with high the Great Western Rail Line – with an but just lags behind the UK average The Great to existing technology and digital strengths in growth regions around the world intersecting north-south axis along Western Powerhouse can be an exemplar of the AI, high performance computing and the M5 and Cross Country Rail future economy, drawing on its existing strengths quantum technologies The five key areas of collaboration that can enable in high value sectors to respond to the grand the Great Western Powerhouse to achieve its £107bn economy, with Gross challenges of tomorrow, such as clean growth, The region is a major centre for research and potential are the following: Value Added (GVA) per head of AI and health innovation innovation with a host of assets across the region: £24,428 – higher than the Northern 1 Industrial Strategy Powerhouse and the Midlands The economic dynamism and growth potential of • Ten universities and three members (Bath, Engine, but with the potential to this area is highlighted by the potential for there Bristol and Cardiff) of the GW4 alliance – Build much better linkages across its areas significantly improve to the UK to be a fourth city region in the coming decades a network of the research intensive universities of sectoral strength in order to deepen average of £27,557 The Central Gloucestershire City Region, specialisms, strengthen supply chains and encompassing Gloucester, Cheltenham and • Bristol and Bath – the National Composites further accelerate innovation 7 cities – Bath, Bristol, Cardiff, Centre and the Quantum Technologies Tewkesbury, will have a projected population of Recommendation 1 – To develop a Great Western Gloucester, Newport, Swansea and Innovation Centre at the new University of over 500,000 by 2050, creating a city region Powerhouse Industrial Strategy, linking together Swindon Bristol Temple Meads Quarter approaching the size of a top 10 UK city the sector strengths identified in local industrial 3 City Regions – West of England, strategies in England, and those identified in the The region has distinct