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Channel 4 re-location could add £5Bn to economy

Channel 4 re-location could add £5Bn to economy

🕔05.Jul 2017

The West Midlands Combined Authority (WMCA) has submitted a response to the Government’s consultation on Channel 4, Increasing the Regional Impact of Channel 4 Corporation, suggesting it would add £5Bn to the regional economy, reports Kevin Johnson

The Government consultation sought views on how Channel 4 could most effectively contribute to regional economic growth, stimulate creative industries outside the capital, and better serve regional audiences.

The West Midlands’ response highlights how it would be an ideal location for Channel 4, if the broadcaster does relocate its headquarters outside of London. The submission also outlines what it describes as “the substantial economic and cultural benefits” that the broadcaster would bring to the West Midlands.

The submission does not state which location in the region would be best placed. There are potential sites in Birmingham, Solihull and Coventry.

Channel 4’s relocation to the region could directly generate £2.3 billion of gross value added (GVA) between 2021 and 2030, according to the submission. It would also create £2.7 billion of indirect GVA during the same period, by stimulating further development of the local creative cluster.

The WMCA’s Strategic Economic Plan aims to grow the region’s creative sector by £7 billion by 2030; the arrival of Channel 4 would generate a total of £5 billion.

Andy Street, Mayor for the West Midlands, commented:

If we are successful in persuading Channel 4 to relocate to the West Midlands, the impact on our region would be genuinely transformative.

Not only would our creative and digital sectors receive a massive boost, but there would also be huge regeneration and investment benefits.

The West Midlands offers the ideal opportunity for a relocated Channel 4. Our pitch is that Channel 4 could thrive here in the West Midlands and we stand ready to work in partnership with them to make a success of any move.

Mr Street is playing a prominent role in three key bids for the region – Channel 4, Commonwealth Games 2022 (Birmingham and region) and City of Culture 2021 (Coventry). He is lobbying Culture Secretary Karen Bradley in an effort to land the channel. The Conservatives committed to re-location in their manifesto.

Channel 4 has the opportunity to build upon a platform of digital and creative skills, a rich legacy of TV broadcasting and media production, and clusters of innovation according to the West Midlands Growth Company.

A relocation to the West Midlands would also bring significant benefits to Channel 4. As the youngest and most diverse region in the UK, it would enable Channel 4 to serve its audience and public service broadcasting commitments, say West Midlands leaders.

Senior Channel 4 executives are resistant to a move, whilst it is likely many staff such as those involved in media sales would stay in London even if a re-location was ordered.

It is thought Birmingham will face tough competition from Bristol, Manchester/Salford, Leeds and Cardiff. The prospect of a move has already claimed one possible casualty, with favourite Jay Hunt deciding not to purse the channel’s top job leaving Alex Mahon to become CEO.

Nearly half (46%) of Birmingham’s population is under 30 years old, while Coventry’s population is seven years younger than the national average.

Just 27% of all public service broadcasting viewers think they see individuals from the Midlands on TV daily, compared with 53% who see individuals from London, according to the latest Ofcom Public Service Broadcasting Diversity Report.

The submission highlights how the West Midlands is a “renowned business and creative hub” that would provide the least disruptive option for a relocation. The region has a “strong track record” in welcoming other major relocations such as global bank HSBC, BBC Three and HS2 Ltd.

Its skills workforce has been a key factor in attracting and retaining firms, while the West Midlands is also cost-effective, with prime rents at 50% below London’s rates according the Growth Company.

Cllr John Clancy, leader of Birmingham city council who is leading the Channel 4 project on the WMCA Cabinet as the member for Economy, commented:

The broadcaster would…be joining a long list of new and growing businesses, with the region producing over 22,000 new companies last year – double the UK growth rate. We would welcome Channel 4 to the thriving business environment here in the West Midlands.

The WMCA offers “wide-ranging” support to Channel 4 should the broadcaster move to the region – including a package of business support for local firms, to maximise the opportunities offered by the local creative and digital sectors in working with the broadcaster.

The WMCA says the West Midlands already has the largest digital sector outside of London, employing some 25,000 people, and a range of internationally renowned cultural and creative organisations, with production companies including Maverick, Full Fat TV, North One and 7 Wonder.

The region’s road, rail and air links will help Channel 4 serve its audiences and work with its partners across the UK. The region’s central location – which is highly accessible from all parts of the UK – will be boosted further by HS2.

The WMCA’s response was co-ordinated by the West Midlands Growth Company and supported by the three West Midlands LEPs – Greater Birmingham & Solihull, Black Country and Coventry & Warwickshire – along with several local authorities.

KPMG and BOP Consulting were commissioned to help develop the response, which has also involved consultations with a wide range of stakeholders in industry, education, the media and the creative sector.

Former BBC executive Anita Bhalla, now a Greater Birmingham & Solihull LEP Board Director who leads on the creative economy, said:

We have a young, digital and diverse population, with a technology and innovation sector that boasts more than 6,000 firms, delivering £1.6 billion to the local economy – this is more than any other core city. Currently we have 37,400 students studying digital and creative subjects within an hour of Birmingham, helping secure our place as one of the country’s leading creative centres.

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