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A question of scale: a challenge for the Black Country LEP

A question of scale: a challenge for the Black Country LEP

🕔22.May 2011

The Centre for Cities thinktank this week published an excellent overview of the state of play of Local Enterprise Partnerships across the UK.

The report, Sink or Swim: What next for Local Enterprise Partnerships, succinctly presents the challenges for the country’s 33 LEPs, particuarly around the need to avoid mission creep and to ensure the private sector’s pre-eminence in the partnerships is maintained.

But in the stats to support the report, there’s a stark fact that should give the Black Country LEP pause for thought.

During last summer’s chaotic formation of the LEPs (which Vince Cable admitted was ‘Maoist’) , the burning question in the West Midlands was whether  Birmingham and the Black Country could work in unison. After weeks of wrangling and dispute, the parochialism of the region won out, and the two went their separate ways.

Birmingham, however, has since welcomed into the camp Solihull, South Staffs, Redditch, Burton and Bromsgrove, neatly illustrating the need for LEPs to cover ‘natural economic areas’. The government wants LEPs to break out of local authority boundaries to represent an area’s total ‘travel to work’ area. In other words, there’s no point having an LEP influencing economic activity in an area if half its residents work elsewhere.

As the Centre for Cities report says:

In areas where large numbers of residents commute to work elsewhere it will be significantly more difficult for LEPs to influence their own economic prospects.

The report’s figures show that fewer than 80% of Black Country residents actually work in the area, one of the smallest proportions of any of the LEPs. Staffordshire and Worcestershire are at around the same level, but of course parts of their areas have decided to join the Birmingham LEP as well as their own.

The challenge to the Black Country is clear – the wealth of more than 20 per cent of  its residents is created elsewhere (ie Birmingham), yet it holds little or no sway over this very significant slice of its economy. With Birmingham salaries generally higher than in the Black Country, what’s the betting that this proportion rises to 30% in terms of total wealth?

Birmingham’s LEP has already shown how it can act as the economic powerhouse to neighbouring regions that are part of its LEP. Its proposed city centre-based Enterprise Zone will create an investment pot of more than £700m, much of which will be targeted at an ‘enterprise belt’ encircling the LEP area, way beyond Birmingham’s city boundaries.

This of course, won’t include the Black Country LEP area, which will have to plough its own furrow and achieve its aims while in control of less than 70% of its own economy.

The Centre for Cities report says LEPs have six months to prove themselves, or to be consigned to history as just another ineffective tier of local government bureacracy.

We think the Black Country LEP will have to work harder than most to meet that deadline.

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