Give us the powers and we will lead the post-Brexit economy

Localis report

As consultation on the Government’s Industrial Strategy Green Paper draws to a close, I want to underline the importance for Birmingham and the wider West Midlands of a joint approach towards one of the biggest issues facing this country.

I’m determined that we will lead the country in showing how cities can be at the forefront of a new, post-Brexit, industrial strategy.

The countdown to Brexit is about to begin. The Prime Minister has signalled she will trigger Article 50 next week and whether we like it or not, the UK will leave the European Union in two years.

This means the requirement for a sound industrial strategy, with buy-in from both central and local government, has never been greater. Post-Brexit it is vital that investment currently coming from the EU to Britain is maintained, that we address the skills shortages holding back the economy and the prospects of local people, and maintain investment in our transport infrastructure and new homes.

This won’t be easy but the task will be even more difficult, impossible perhaps, unless the Government is prepared to move at pace to allow important strategic decisions to be taken locally, at a level where councils and business leaders know what is best for their local communities and can react swiftly to trading opportunities as they arise.

Devolution of budgets and powers from Whitehall has to be far more than just a sound-bite – the advent of a West Midlands mayor alongside a united Combined Authority with metropolitan and district councils working together as never before presents this region with a unique opportunity, and we must be up for the challenge.

The three-LEP geography of the Combined Authority is the right level at which to deliver a regional industrial strategy. But we are also working closely with the Midlands Engine project on those aspects that require a bigger canvas, such as cross-regional transport investment and selling the Midlands globally.

A new report from the think tank Localis, makes the case for radical devolution which would enable Birmingham and the West Midlands to deliver an industrial strategy to create jobs and inclusive growth for the region post-Brexit.

The report recommends that the West Midlands be given:

  • A new Accelerated Growth Fund, to replace EU funding and pool all existing local funding
  • Powers to more effectively plan for current and future labour market needs, including co-ordinating local skills provision
  • Leadership on local land provision for housing and jobs and on the use of all public land, stronger compulsory purchase powers
  • A duty to develop local transport strategies and control over investment planning
    Control of local bus services
  • Power to control a Community Infrastructure Levy across the area and new Zonal Infrastructure Levies
  • Greater discretion over business rates and pilots of fiscal devolution steps such as a local corporation tax top slice, localised VAT and wider borrowing powers
  • Rights to propose public sector relocations from London, such as government departments or Quangos.

The report is particularly welcome as it is in line with the arguments we have been making to the Government on the need for more devolution so that we can deliver the investment needed to prosper after Brexit.

These changes would go a long way to enable Birmingham and the West Midlands to make a greater contribution to the nation’s prosperity and achieve the full potential we know exists in the region.

When the Industrial Strategy Green Paper was published, the Prime Minister promised the Government would step up to a “new, active role that backs business and ensures more people in all corners of the country share in the benefits of its success”.

The Government said it would look favourably on the type of sectors that will shape the economy of tomorrow, with life sciences, low carbon vehicles, industrial digitalisation and creative industries expected to be at the front of the queue for investment.

This is potentially good news for Birmingham and the West Midlands where our hospitals and universities are already blazing a trail in medical research, and where JLR has expressed a wish to look at building a new battery and assembly plant for electric cars.

But as I’ve already made clear, there’s much more the Government should be doing if it wants to rebalance the economy and promote inclusive economic growth, with well-paid jobs for all citizens. Enhanced capital allowances should be considered to stimulate investment in manufacturing, the Advanced Manufacturing Supply Chain Initiative should be resurrected, and funding gaps for small firms in the supply chain need to be plugged.

I welcome the Green Paper’s recognition of the importance of individual councils and combined authorities as key local institutions but again look for a stronger commitment to devolution to enable us to deliver.

The Government must ensure that governance at a regional level, whether through combined authorities, local enterprise partnerships, or mayors, should be able to work with development bodies that can intervene more widely and strategically at a regional level, and do smart specialisation through regional level industrial policies.

Posted on March 22, 2017, in Blog and tagged , , , . Bookmark the permalink. Leave a comment.

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