Centre for Cities

The new Mayor of Bristol - top economic priorities

While voting for Police and Crime Commissioners has taken most of the attention today, the people of Bristol are also currently taking to the polls to vote for their new mayor.

The referenda on mayors held back in May were a bit of a damp squib – Bristol was the only city of those polled on the issue of introducing a mayor to vote yes. But despite going against the crowd, the significant improvement in strategic leadership that the mayoralty is likely to provide will be a very good thing.

So how should the winner of today’s vote put these freedoms to good use? Here are three suggestions:

1. Make sure Bristol’s City Deal is a success. The recent negotiation that the city entered into with Whitehall has given it an excellent opportunity to tailor economic policy for its area. In the short term delivering on this Deal should be the number one economic priority for the new mayor.
2. Play a co-ordinating role between policy areas and act as a figurehead. The Mayor of London is a good example of what can be achieved here.  He chairs multiple London-wide boards that are responsible for economic development, such as Transport for London and the Local Enterprise Partnership. He sets the London Plan, which sets out a city wide strategy to support economic growth. And most clearly of all, he acts as a figurehead for the capital, not just for the rest of the UK but around the world. Investors know who to speak to; citizens know who to hold accountable. When asked to name the leader of London, surely few would struggle to answer.
3. Self-define the role. Lack of clarity around what extra a mayoralty would do is likely to have been one of the main reasons for the resounding 'no to mayors' vote in most cities back in May. But this presents a real opportunity for the Bristol mayor. The appetite shown by Government to devolve power through City Deals gives scope for further requests from the mayor’s office. Again, London acts as the case in point – the remit of the Mayor of London is much wider now than when the position was created in 2000, a remit that has been expanded incrementally over the last 12 years.

Of course, the Mayor of London covers 33 local authorities, rather than the one that the Mayor of Bristol will represent. This is a key problem of the type of mayoralty that was offered to our cities outside of London.

So over the longer term, as the mayor demonstrates the impact that they can have on the city economy, he or she should also seek to work with neighbours to augment the mayor's political coverage to one that matches the economy of the city, not an artificial boundary on a map. For those outer areas worried that this will mean too much focus on the city at the expense of more rural areas, it may be worth remembering that the first time Boris Johnson was elected mayor of London, it was on the basis of votes in the suburbs rather than the city centre.

Bristol is a vital cog in UK plc. With the strong stewardship of its new mayor it could cement its position as England's strongest performing big city outside of London. Today marks an important juncture in the city's history. Whoever is elected, the mayoralty is likely to provide significant scope to support the city and its residents to prosper in the future.

Follow Paul on twitter @Paul_Swinney

From lost generation to regeneration: our Labour Conference fringe

Three knights, two mayors and a Lord joined me for Centre for Cities fringe at the Labour Party Conference on Tuesday night.

Taking place in Manchester’s Victorian town hall, our packed-out event tackled the century-old debate of the re-empowerment of local government. And, while the rest of the conference focused on what Labour should do if it regains power in 2015, our panellists focused on what they are doing to improve the success of their cities today.

Sir Richard Leese set out how he wants to improve the skills of Manchester’s population so that the recent success seen in Manchester’s city centre spreads out to the rest of the city and city region. As City Deals continue to be discussed, he will be arguing for skills commissioning powers to be devolved down to the city region level. 

Mayor Joe Anderson spoke about how becoming mayor has put him in a better position to promote and champion Liverpool both home and abroad.

Sir Robin Wales set out how Newham’s Skills Place initiative has seen great success in getting people into work in the Borough. Newham's proactive approach to working jointly with employers and jobseekers to better match jobs to jobseekers succeeded in getting 5,000 people into work last year.

Finally Lord Adonis, who is currently drawing up Labour’s industrial strategy, challenged the party to set out what metropolitan institutions it would like to see to support city growth. Following his support for the mayoral campaign, he would like to see more powers devolved to city regions to promote growth – a position the Centre has also championed for a long time.

In discussion Birmingham's leader, Sir Albert Bore, questioned whether academies, which are outside the control of local authorities, weakened a city’s ability to drive up educational attainment. There was no consensus on this point and it was interesting to see that opinion was divided on this topic across Conference.

At the end of his question and answer session at conference, Ed Miliband said that Labour policy needs to be formulated bottom up, working with local authorities. On the basis of our fringe event, there's no shortage of ideas from local government, or examples of what works on the ground and will support the local growth that the UK needs.

City Matters - my weekly cities reading list

I hope you enjoyed some, if not all, of my reading suggestions from last week.  I received some great suggestions via Twitter and email from fellow city geeks, which are much appreciated.

This week I’ve gone for a mix of the current, the old and the classic.  I hope you enjoy these and please continue to suggest others that I should read and recommend. 

• ‘Homeownership and Entrepreneurship’ by Philippe Bracke, Christian Hilber & Olmo Silva (2012) - highly relevant analysis of how buying a house influences whether someone is likely to start their own business.
• ‘Regional Economic Resilience, Hysteresis and Recessionary Shocks’ by Ron Martin (2011) - provides substance to the widely used notion of resilience and explores how places can and do respond to economic shocks and what this means for their long-term success.  
• ‘Abundance of land, shortage of housing’ by Kristian Niemitz (2012) – critiques some of the reasons offered to explain why UK housing costs have increased over the last decade before calling for a more ‘liberal’ planning system.  
• ‘Contrasts in Agglomeration: New York and Pittsburgh’ by Benjamin Chinitz (1961) - all I can say is read this and enjoy.  10 pages of great insight into how industry dynamics affect city success.
• ‘Soft City’ by Jonathan Raban (1974) – a travel writer’s perspective on what makes cities so appealing and revolting.  Includes a great chapter on anonymity in crowds that reminds me of travelling on the tube every day.

Follow @AndrewCities on Twitter

What happened to the ‘City of a Thousand Trades?’ Birmingham from 1901 to today

Centre for Cities' new report, Cities Outlook 1901, explores how cities are shaped by their past. It shows how cities and why cities have taken different paths over the course of the 20th century. The story of Birmingham provides some interesting lessons for current and future policy.

If you lived in Birmingham back in 1901, the chances are life would have been pretty good. It was the fourth largest city in the country at the time (behind London, Manchester and Liverpool) and a magnet for people looking for economic opportunity. The ‘City of a Thousand Trades’ was a workshop full of small, highly skilled firms producing a huge range of products. As a result, levels of enterprise were high and unemployment was low. At this point 12 percent of employment in the city was in vehicle manufacture.

Then came the 1930s. The cheap Pound, availability of credit and rearmament led to the rapid expansion of manufacturing in the city – predominantly in the automotive industry. With organisational and technological change also came the expansion of unskilled and semi-skilled labour in the city.

While the city saw huge numbers of new jobs created over the first half of the 20th century (unlike other manufacturing centres), it also become increasingly specialised in the automotive industry. The high cost of wages and rent in the city, coupled with the impacts of the 1945 Distribution of Industry Act to redistribute jobs, made it increasingly difficult for new industry to locate in the city. By 1951, 72% of the manufacturing workforce were employed in the automotive industry.

The 1970s recession forced the collapse of the automotive industry. As a result, Birmingham, which had followed a very different path from other manufacturing centres in the decades following 1901, saw a striking transition from high employment and high wages to high unemployment and deprivation. The city has since seen modest jobs growth, driven primarily by the public sector.

The story of Birmingham is not a critique of the automotive sector. The West Midlands today is still home to valuable jobs and innovation in the industry. What is does tell us, however, is that over reliance on a single industry makes a city economy more vulnerable to changes in the wider global economy. It also highlights the potential adverse effects of policy.

Cities should constantly be considering how they can make the most of niche strengths but also how they can encourage greater industrial diversity. For many cities the focus will need to be on the fundamental drivers of growth: skills and infrastructure. Cities need to work with local providers to ensure education and training responds to the needs of the modern economy and target investment in infrastructure to ensure cities are both better connected and attractive to workers and businesses.

Follow Naomi on Twitter @Naomi_Cities

Now the City Deals are done, four key questions on what happens next

The Government’s ‘City Deals’ mark one of the biggest shifts towards devolution of power to local areas that England has seen for decades. It’s a day to celebrate some hard-won freedoms and flexibilities – but there’s a long road to travel before cities can say they have real autonomy over their local economies.

The six remaining Core City Deals have been announced today: Birmingham, Bristol, Leeds, Newcastle, Nottingham and Sheffield. These join the Manchester and Liverpool Deals already announced (although Liverpool has today extended its deal to the wider city region). Areas devolved include: funding and finance, skills, infrastructure and business support.

As the Centre’s summary shows, each city has agreed a mix of different policies, all in exchange for commitments to deliver jobs, apprenticeships or even a ‘NEET-free’ city.

This kind of bespoke approach for the first round of devolution is welcome – the Centre for Cities has been calling for this for years as it enables cities to tailor policies to their particular needs, rather than having a ‘one-size-fits-all’ policy that doesn’t really fit anyone properly.

But it’s what happens next that will really determine whether cities continue to gain more autonomy from central government. In my mind there are four big questions.

First, will the cities deliver? Many in Whitehall are still looking for any excuse not to relinquish power and funding. The Core Cities are trailblazers; they will know all too well that with their additional powers comes additional responsibility. If they don’t keep to their promises, however big, the implications will be felt by all cities.

Second, who will be in the second wave of City Deals? Centre for Cities’ analysis suggests that it should include some of the fast-growing small cities (e.g. Cambridge, Milton Keynes), where policy intervention could make a big difference to growth and jobs, as well as some of the mid-sized cities (e.g. Sunderland, Coventry) that could really benefit from intervention. We talked about the benefits of a mid-sized cities £500m investment fund for city centres in our report published last week.

Third, will there be a ‘basic package’ of policies on offer to a wider group of local authorities? There are some core themes running through the Deals, like single Economic Development pots, that could easily be rolled out more widely, provided local authorities can demonstrate they can take tough decisions. This would be a big step for a reluctant-to-devolve Whitehall, but could make a big difference to local authorities strapped for cash and keen to make all existing money work harder for the local and national economy.

Fourth, will Whitehall deliver? And will the Government keep to its very welcome commitment that this is just a first step? The Government has been clear that it will keep talking to the Core Cities about developing their Deals and this is vital. It is only through keeping the dialogue going, keeping on demonstrating how cities can deliver better outcomes and / or greater efficiency, and keeping on encouraging Whitehall to let go of a little bit more, that we will give cities the autonomy that could make a big difference to local economies.

Today marks an important first step towards devolution and the Core Cities should be delighted with progress so far. But we will need to wait for a while yet before we know whether City Deals will really mark a turning point in relationships between central Government and England’s cities.

Follow @AlexJonesCities on Twitter

 

Beyond the Core: City Deals for mid-sized cities

The Government is due to conclude its City Deals negotiations with the Core Cities in the next week or so.  As part of the sign-off ceremony there’s likely to be an announcement about the next wave of City Deals.  

 In preparation for City Deals Round Two on Tuesday we launched our work on mid-sized cities. The work identifies that there are several medium sized cities – including Derby, Coventry, Sunderland and Preston – that have similar economic characteristics and challenges.

 Because of these similarities we argue that there are advantages to be gained by Government by dealing with them as a group in the first instance. The research deliberately does not strictly define which cities should or shouldn’t be in this group. Our only criterion for the group is that it’s a group of the willing – it should provide the platform for other cities that feel that they identify with these issues to come forward to join the group.

 Using Sunderland as the main focus, the research shows that the recent underperformance of its city centre has undermined its overall economic performance. The city was one of the stronger performing cities in terms of private sector jobs growth before the recession. But at a time when its economy overall was exceeding expectations, its city centre actually lost private sector jobs.

The report shows that very similar patterns have also been seen in Preston. And it identifies other cities such as Derby, Wakefield and Coventry that are displaying similar symptoms that are characteristic of a city with an underperforming city centre.

For this group of cities the report calls on the Government to create a £500 million mid-sized cities investment fund as part of the City Deals process. Commercially-run the fund would change the way that European Regional Development Fund (ERDF) money is allocated, moving from the allocation by regions, as currently occurs, to allocation according to economic issue. It would then be matched by central Government monies such as the Growing Places Fund, local authority assets and private sector money. There are a couple of different ways that this fund could be set up, but I’ll do a post at a later date looking at this issue.

The fund should be used to reconfigure the city centres of our mid-sized cities. It’s important to stress here that the operative word is reconfigure – these cities should look to reshape their city centres so that they better operate as environments to do business. So while it may mean building some new office space, it will also mean removing office stock, either through demolition or conversion.  It may also mean encouraging more residential.

The fund will not provide a free lunch for cities either. The Government has been very clear that the City Deals process is just that – a deal. This means that cities also have to bear some of the risk and cost of the reconfiguration. See the report - Hidden Potential - for more detail on this.

But given the knock on impacts that underperforming city centres have on wider economic performance and the growing economic importance that city centres are likely to have in the future, the weak urban cores that some cities suffer from is a pressing issue. City Deals provide an opportunity for these places to tackle this fundamental problem head on.

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Do City Deals need a shot in the arm?

The city devolution agenda is an increasing a focus for growth aspirations.  So far negotiations have only involved the eight Core Cities, but Cities Minister Greg Clark announced back in January that groups of mid-sized cities should begin to prepare their ideas. However, four months on Government is still debating how to deal with these places.  Are City Deals about to enter a new, exciting second phase or are they running out of steam?

As a timely letter to Clark from the "Growth Cities Network" group points out, the UK’s fastest growing cities are outside the core group, and in a better position to deliver increased growth at a lower cost.  Centre for Cities’ Investing in Growth Cities report analysed their potential earlier this year.  Nor is growth potential confined to the South East: cities across the country are queuing up to join the conversation.

Government is therefore coming under increasing pressure to deliver on its ambitious devolution agenda for cities, but some important questions remain unanswered.  Not least, there is the question of what next for the cities whose voters said no to a mayor.  Accountability through a mayor or a combined authority has so far proved the only acceptable currency for deal-making.  Now Greg Clark needs to show flexibility, and demonstrate that making deals that are right for each place is more important than political objectives driven by the centre. 

Willingness to engage is also a crucial factor.  The Core Cities group was self-defining and therefore theoretically easier to engage with, but the question of how Government will manage negotiations with other cities remains hanging.  Grown-up conversations rather than beauty contests should be the way forward.  Future city deal discussions must be triggered a simple process to determine the quality of ideas emerging from mid-sized cities, rather than by using complex or artificial qualifying criteria.

Getting conversations going is just the start, and there is wider uncertainty around crucial growth drivers. For example, can cities really influence the skills agenda through the funding and delivery structures now in place?  Does Government see housebuilding as part of the growth agenda? And what is the future of infrastructure funding when the regional growth fund pot runs out?  These matters of substance can only be addressed through detailed discussion, but someone needs to make the first move.  If Government is otherwise engaged, they should expect cities to start banging loudly on their door very soon.

Follow @thomaseabolton on Twitter

 

What does the 'Boris and Ken show' tell us about city mayors?

The London mayoral elections – or the Boris and Ken show, as they seem to have become – demonstrate quite how important it is for mayors to be seen as both part of their political party and independent of it at the same time.

Being part of national political parties matters hugely to mayoral candidates. Not only do they capture some of the ‘safe’ votes for these parties, but representing these main parties means that ‘the big four’ in London – Boris, Ken, Brian Paddick and Jenny Jones – are all included in all the official mayoral debates.

Independent candidates, such as Siobhan Benita, and candidates for other parties, such as UKIP, do not tend to be given the air time and so find it more difficult to generate coverage for their manifestos – although Siobhan Benita is benefiting from a wide range of endorsements and increasingly gaining coverage in the national press.

But it’s also striking that candidates’ popularity is different from the popularity of the parties they represent. This week’s Evening Standard / YouGov poll shows that both Boris is 10 points ahead of the Conservatives, having opened up a 6% lead on Ken, while Ken lags 6 points behind the Labour party.

This concept of the mayor as an independent insider is part of what attracts voters to the idea of a mayor – Boris has made a big show of the way that his advocacy of London has benefited the city through policies such as the Royal Docks Enterprise Zone.

But this also reinforces the importance of personality to mayoral politics. Although each candidate is putting forward different headline policies, the focus in the media has tended to be on tax returns or heated debates in a lift – not big policy issues for London, but details about the two main rivals for the job. And while it’s great news that local elections are generating the interest and conversation that they are, and that so many people are on first name terms with two candidates that most people have never met, it’s important that the campaign is about more than just swapping insults.

Mayors have huge potential to make a difference to the economy of their city, and there has rarely been a better time for a Mayor of London to showcase London to the world during the “Jubolympics” – (the fantastic BBC programme Twenty Twelve’s term for the Jubilee and then the Olympics). Policy details are never going to hit the headlines in the same way as details about the people going for the job, but they’re what will really make the difference to London’s economy and the people who live there.

Follow @AlexJonesCities on Twitter

 

Liverpool’s ahead in the mayoral game

Last week, Liverpool’s councilors voted to bypass a referendum and go ahead with a May election for a Liverpool Mayor.  While it’s not the Mayor for Merseyside the Centre for Cities has advocated, Liverpool’s eagerness to embrace the mayoral model – as Leicester has also done – demonstrates that the benefits of a Mayor are being more seriously considered in the major cities than the “no” voices sometimes makes out.

So, will having an elected Mayor make a real difference in Liverpool?  Our joint report with the Institute for Government suggested that mayors had the potential to make it easier to be decisive on strategic economic issues, bring coherence to the actions of the public sector, collaborate with other partners and to represent their cities to the public and private sector.

A first positive sign that some of these benefits could be realised is that the city is also now the first to strike its “City Deal” with Whitehall – a deal which is set to come with £130 million funding.  

The Deal involves creating a new enterprise zone for the central business district and five mayoral development zones to target regeneration in other areas of the city. There will also be powers to help young unemployed people through welfare-to-work pilot schemes, oversee the development of city assets owned by the Homes and Communities Agency and, using DCLG funding, build six new secondary schools.

Our evidence still suggests that mayors have the greatest potential to be effective when they’re across a travel-to-work area, rather than simply a local authority. And Liverpool has already recognized the importance of ensuring the mayor works well with the Local Enterprise Partnership, which covers Merseyside.

But, grumbles about city-region mayors aside, what is clear is that Liverpool’s willingness to take this step has reaped dividends. While the Government has acknowledged that different structures of governance will be appropriate for different cities, it also seems that moving to an elected mayor was the clearest way for Liverpool to demonstrate that it has the strong and accountable leadership that all the City Deals will be conditional on.

We’ve been working closely with the Cabinet Office and cities currently brokering their City Deals – I’ll write more on how this process is working, and what Government is looking for, later this week.

Follow @AlexJonesCities on Twitter

 

Cities at the heart of their regional economies

We know cities are important to the national economy, that’s why Greg Clark was appointed Minister for Cities in July last year. But cities are also important to their regional economies. And this is one of the things this year’s Cities Outlook highlights.

Cities are the heart of their regional economies. The 11 cities in the North West are home to 68 percent of the region’s businesses and 72 percent of employment – both large proportions considering they only cover 24 percent of landmass. Similarly, the 18 cities in the Greater South East cover just 16 percent of landmass yet generate 70 percent of wealth and account for 69 percent of those working in highly skilled occupations.

And it’s not just the most successful cities that support their regional economies. Cities like Hull and Doncaster despite having less dynamic private sectors housed, together, 8 percent of businesses located in Yorkshire & Humber, accounted for 10 percent of employment and generated 9 percent of wealth.

In addition, the influence of cities is not simply confined to their urban cores but extends out beyond their physical boundaries. People travel to cities to work – people living outside Bristol travel around 38km to work in the city – but also to shop and enjoy amenities like theatres and restaurants. Business supply chains also extend well beyond city boundaries and their customers are often located elsewhere too. 

For more stats and facts see Cities Outlook 2012 and our new data app.