A city region approach to spurring the competitiveness of Wales

The geographic scale at which policy should be designed and implemented, and public services configured, is a perennial issue that generates much heat and contention. Devolution is itself the result of such debates. The latest instalment concerns the notion of city regions, and potential for the establishment of city regions for parts of Wales. A city region would allow the urban area of Wales the resources it requires to grow, and the surrounding areas, in particular the South Wales Valleys areas, access to the infrastructure required to attract investment and much needed jobs.

In basic terms, the city region policy agenda concerns the means by which economic competitiveness, investment, and innovation can be improved by enhancing connectivity across local administrative ‘borders’. City regions aim to promote the collective provision of services across a wider geographic scale than those associated with provision provided by any particular local authority. It is suggested by some that city regions can offer benefits in terms of the process of economic development, particularly the greater attention given to promoting more integrated and finely-tuned policies and service provision (which, incidentally, is similar to the rationale underlying devolved regional government). Others, we should note, are more sceptical, suggesting that city regions actually have the potential to reinforce uneven development.

Historically, the city region concept has been somewhat neglected in the UK policy-making agenda, largely due to the concern directed at urban, typically inner-city, problems – both social and economic. However, the idea of city regions can be traced back to the 1940s, with city region models at the time considered to provide a potential link between urban and rural areas, whereby the rural area acts as the zone of agricultural production for the core area.

Although new and improved transports links means that today’s rationale for city region development is more complex, it is still based on the notion of connecting relatively prosperous urban areas with their usually, although not always, economically weaker hinterlands.

So, would a city region improve the economic prospects of Wales? Clearly, action is needed. The UK Competitiveness Index indicates that all is not economically well in the proposed city region. Blaenau Gwent and Caerphilly are the least competitive local authority areas in Britain, with Torfaen and Rhondda Cynon Taf also among the bottom ten British localities (based on a total of 379 localities). Furthermore, the cities of Cardiff and Newport have seen their competitiveness drop since 2010: Cardiff was ranked 17th on the city index in 2010, but has fallen to 24th in 2013; while Newport fell from 30th to 35th.

If we are to look for signals of the potential for a city region to promote revival it is worthwhile taking a peep over the border to England. Following the introduction of the Coalition government in 2010, a series of 39 so-called Local Enterprise Partnerships (LEPs) have been introduced to foster economic development and improved competitiveness. LEPs are basically the successor organisations to the English regional development agencies which were formed by the previous Labour government and quickly disbanded by the Coalition.

LEPs are joint local authority-business bodies with a remit to promote local economic development, covering the majority of England. Many LEPs areas, especially in the north of England, reflect the development of the concept of city regions, and aim to reflect clusters of economic activity, rather than the apparently ‘artificial’ boundaries previously drawn, for example, around the regional development agencies. In general, LEPs aim to establish collaboration between the public and private sector, as well as between different authorities. Such an approach is considered to be a means of ensuring that economic decisions are more business-led, particularly with regard to formulating planning reforms and planning policy that supports economic growth.

LEPs are not without their problems, in particular a lack of funding compared to the previous regional development agencies, but there are some signs that they may be making a difference. It is still very early days, and far too early to definitively suggest cause and effect, but some LEP areas that share the industrial heritage of Wales appear to have improved, or at least stabilised, their competitiveness position since 2010. LEP areas covering the Leeds, Manchester and Tees Valleys ‘city regions’ have improved their position in the LEP area competitiveness rankings since 2010, with the Liverpool city region achieving a slight improvement in its competitiveness. Although these changes are far from startling they are in contrast to downward trajectory of many of the authority areas in South East Wales.

In England, it is to be hoped that LEPs are given the opportunity to develop and establish, where relevant, functioning city regions. As we know, changes in government habitually result in a tearing up of incumbent institutions, resulting in a situation whereby local policymakers are largely left to start from scratch. From the perspective of Wales, these are the lessons which we hope the devolved Welsh Government will learn from.

In many ways, Wales, especially its Valleys, is a unique economic landscape, with urban-like settlements formed in areas that are often largely rural. The historic roots of the city region concept, and its linking of urban and rural areas, does indeed suggest that such an approach may have the capacity to promote economic development providing that government commitment at all levels is secured and sustained over the long-term.