The financial and economic turmoil we have experienced in recent years has highlighted the imperative to rebalance the country’s economy. Strategies to focus efforts, such as the dissolution of regional development agencies in favour of the creation of a Local Enterprise Partnerships which bring together both civil and business leadership, has shown a level of intent from the Government.
However, as the UK economy continues to struggle to deliver sustainable growth, more needs to be done to help regional cities return to a path of growth and get the UK economy moving again.
While initiatives such as the City Deals are a step in the direction of local empowerment, having the ability to make fundamental decisions to shape the prosperity of a regional economy will sit outside of this remit.
One of the key roles of Government is undoubtedly to create the right environment for the country to thrive, and it is on this point that more needs to be delivered – above and beyond the City Deal approach.
The debate over regional powers must be heard. Lord Heseltine recently outlined his views in favour of increased devolution and we must ensure this is thoroughly debated and not allowed to slip onto the ‘too difficult’ pile.
Local leadership is paramount to responding to the opportunities that globalism presents. Making sure we have the right skills, the right infrastructure and the right businesses to attract investment, as well as exploiting all export opportunities, can only really be achieved by those operating within the market on a daily basis. A thorough understanding of the idiosyncrasies of each City Region is crucial in making the necessary changes to make all our cities world class.
And there is evidence that this approach works. If you look at the regional model adopted by Germany, it is clear to see the independence offered to their City Regions has created vibrant and successful economies.
For example, if you were to look at the thriving economies of Frankfurt and Munich and then compared them to say two of our major regional cities, I wonder if you would find the same comparatives? Munich has one of the strongest economies in Germany, home to a number of global businesses and is considered a global city by those across the international marketplace. Frankfurt also has an international reputation as a financial centre, yet it is the fifth largest city in Germany.
The forthcoming Autumn Statement is a great opportunity to get this debate underway, and quickly, without it we face falling further behind competing nations.
By Mike Steventon, senior partner of KPMG in Birmingham