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Talks to begin immediately on Devo Deal II

Talks to begin immediately on Devo Deal II

🕔24.Jul 2017

Greg Clark, the Business Secretary, used a visit to Birmingham and a speech on the forthcoming Industrial Strategy to announce that talks would start immediately on a second Devolution Deal for the West Midlands.

Mayor Andy Street and the West Midlands Combined Authority (WMCA) submitted a proposal for Devo Deal II two weeks ago. Details have not been made public, but Chamberlain Files understands ‘asks’ include a real focus on control over skills budgets, including retaining the Apprenticeship Levy; some significant steps over housing powers and an increase in an array of powers building on the first deal.

Mr Clark said:

I am delighted to announce today that we will begin talks with the Mayor and the Local Authorities over the coming weeks, with a view to agreeing a further devolution package that will ensure that he has the powers he needs to support delivery of the industrial strategy in the West Midlands.

In his welcome address, Mayor Andy Street said that the region had effectively benefitted from an industrial Strategy for the last 5/6 years, but just didn’t call it that. That period also happens to be the timeframe in which Andy Street chaired the local enterprise partnership, then becoming Mayor of the region.

A sector focus in the area was already working, according to the Mayor, in areas like automotive, life sciences, low carbon and “of course in professional services.”

Mr Street said that the region would do better “economically…and socially” if given relevant powers. These would include over the Apprenticeship Levy, developing homes on brownfield land, more capital investment and innovative approaches to public services such as mental health provision.

The coincidence of a second devo deal for the West Midlands being trailed as leaders in the North West protest about a Government u-turn in commitments to rail improvements in their region was not lost on some figures close to the Mayor.

The minister linked the next round of West Midlands devolution to Brexit, on which ministers have been sending mixed signals in recent days not least in relation to transition and implementation arrangements. Mr Clark continued:

From cars to components, from financial services to computer games, from cultural excellence to food and drink, not forgetting the students who come from overseas to study at the universities, this region depends absolutely on trade with the world.

People who voted for Brexit did not vote to be less prosperous.

And similarly in a region of trade in a nation of trade, people did not vote to trade less – including with our European neighbours.

He added:

There is scarcely a product or a service made here for export that is not an advanced combination of components, capital equipment, design, expertise and intellectual property from a wide range of countries.

Mr Clark said the theme of Britain as a global champion of free trade would run through the Government’s “modern” Industrial Strategy.

Mr Clark’s speech did not contain significant details on the forthcoming Industrial Strategy. His department is still working through 1,900 responses to the Green Paper. But the Secretary of State laid out five foundations for the emerging policy:

  • Invest in skills (particularly reform of technical education)
  • Innovation (commercialising science and research)
  • Place (clusters of people with skills and ideas)
  • Infrastructure (physical and invisible)
  • Government (partnerships and public procurement).

Mr Clark committed to a big role for ‘place’ in the strategy:

…our industrial strategy will give a bigger role for that than has characterised Britain during decades past.

But it was not the full throated commitment to ‘place’ as the overarching framework for an Industrial Strategy that some had hoped for and there was no detail on how local leaders will drive or be responsible for the strategy in their areas.

READ: Will Industrial Strategy find its place in Birmingham?

The Government announced the launch of the Faraday Challenge earlier today which will put £246 million into research, innovation and scale-up of battery technology. Mr Clark also announced the opening of the next wave of the Government’s collaborative research and development competition – Connected and Autonomous Vehicles Fund, worth £25 million.

The Secretary of State’s third announcement was unveiling the ‘Smart Systems and Flexibility’ plan to make the UK’s energy system smarter by helping to reduce energy bills, balance demand on the grid and realise up to £40 billion of benefits.

Mr Clark was introduced at the event – staged at the University of Birmingham, organised BEIS (Business, Energy and Industrial Strategy Department) and the Resolution Foundation – by Mayor Andy Street. They both remarked that the Business Secretary has been visiting the West Midlands every three weeks, on average.

Mr Clark remarked:

The city region with the strongest growth of all the big cities in the UK – including London.

A city region that has created over 100,000 private sector jobs since 2010.

A region of advanced manufacturing, of services, of education, of artistic and cultural excellence – all reinforcing each other.

Greg Clark, in a perfect example of a politician playing to his audience, concluded his speech:

The motto of this great city of Birmingham is a single word: ‘Forward’.

It is the perfect encapsulation of our aims for our modern industrial strategy and this is the perfect place to talk about those ambitions today.

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