Prosperous Places: Taking Forward the Review of Sub National Economic Development & Regeneration

Input from the Northern Region to the National TUC Response

Northern TUC Response to 'Prosperous Places: Taking Forward the Review of Sub National Economic Development and Regeneration'

Representing over 500,000 trade union members in Northern England, the TUC co-ordinates, develops and articulates the views of working people to influence the shape of regional development policies, working jointly with partners to further sustainable economic development and regeneration.

Securing Prosperity in a Changing Economy

The Northern TUC welcomes the publication of the Sub-national Review and endorses the Government's vision for future growth, which encourages lasting and universal beneficial change by working towards a long-standing commitment to promote wealth generation and social justice simultaneously. Public investment in economic infrastructure has undoubtedly helped to cut the costs of economic failure. However the TUC shares Government's view the time is right to assess the impact of investment and give due consideration to improving the sustainability of economic development and regeneration.

Particularly welcome is the Government's recognition that in order to maximise prosperity in all parts of England, tackle social deprivation and inequality, regions, sub-regions and local partners require sufficient flexibility to tailor solutions to their own specific problems. A departure from a prescriptive 'one size fits all approach' is commended. The Northern TUC appreciates that reforming the deal on devolution will require a collaborative partnership between central and local government, working jointly with social and economic partners. Furthermore, the Northern TUC firmly believes the change agenda should be rooted in improving outcomes and therefore avoid procrastination or options that are institution or process-driven.

As policy making has developed a stronger regional dimension, the emergence of new bodies combined with the growth of existing institutions has added to the complexity of governance relationships and spawned a plethora of strategies. Although real efforts have been made in the region to foster a joined up approach, making the best of what we have, there is broad agreement that in reality this can be unnecessarily challenging and incoherent. Consequently efforts to streamline the regional tier and enable the formation of an integrated regional development policy are supported by the Northern TUC. These changes, coupled with a strengthened role for local government, will provide sharpened democratic accountability for economic and social development policies.

Stronger Partnerships for Regional Growth

Increased democratic accountability for devolved regional decision making is regarded as a positive measure to strengthen links between citizens and policies designed to help achieve prosperity and quality of life in the areas where people live and work. We agree that regions, sub-regions and local areas should be empowered to develop and implement their own policy interventions within a light-touch national framework, governed by decision makers elected by the people they serve. Indeed an elected Leaders Forum offers a powerful and potentially effective vehicle to take the long-term decisions necessary to secure economic growth and prosperity.

Regional Ministers indicate enhanced leadership capacity and regional visibility in Whitehall, reinforcing not only a clear sense of the contribution regions can make to improve their own prospects, but also how they can fully support the achievement of national goals. They signify an encouraging move towards improving the nature and quality of dialogue between central, regional and local government; developing a better shared understanding of the role partnership working can play in delivering improved outcomes for different places and thereby contribute to the prosperity enjoyed by England as a whole. The Minister for the North East has generated a mood of optimism, capitalising on the ambition of partners to 'show what we can do' as the fastest growing regional economy. His remit to champion the region's interests at the centre of government is inspiring confidence and growing consensus that the North East has been given the opportunity call for the right tools to increase regional growth and realise its full potential.

Regional Accountability and Scrutiny Proposals

The Northern TUC welcomes proposals in the SNR and Governance of Britain Green Paper to change how regional bodies are held to account. Situating scrutiny of economic and social development at the local authority level will provide a degree of transparency and democratic accountability for regional decision making to the public. It is important that mechanisms for the independent scrutiny of local authorities are built in at the appropriate levels, given that they will ultimately be responsible for delivering outcomes from single pot investment. This should be in addition to the powers already available locally to scrutinise Executive Members, who may also be appointed to the Local Authority Leaders Forum.

Rather than critically analyse an 'end product', the TUC considers effective scrutiny should form part of an iterative process, actively contributing to the development of an Integrated Regional Strategy and contemporaneous assessment of its implementation. To pioneer and test the efficacy of regional scrutiny, the Northern TUC advocates structuring arrangements in accordance with the business, people and place themes outlined in the current Regional Economic Strategy. Local authorities would lead on each of the key themes and facilitate broader, relevant stakeholder engagement from the business community, TUC and Environment Agency respectively. This model should render scrutiny more relevant to the policy development process by strengthening the relationship between strategy, ongoing evaluation and the achievement of improved outcomes. Based on consultation with partners, the Northern TUC perceives there is a need for the scrutiny process to ensure balanced attention is paid to the different aspects of development. Scrutiny should avoid succumbing to a 'bricks and mortar' analysis of capital spend on physical regeneration in the built environment. The Northern TUC urges partners to explore piloting these arrangements in advance of the new regime, which would enable any stumbling blocks to be addressed at an early stage and thus optimise the opportunity for regional scrutiny to have a positive impact.

Parliamentary Scrutiny

Enhanced Parliamentary scrutiny of the regional tier would best be achieved through the establishment of regional committees.

Irrespective of the process instituted, the Northern TUC considers Parliamentary scrutiny should serve two functions:

1) Enable regions to support the Government's drive for improved public accountability (making regions more accountable to government in return for greater freedom to determine their own investment priorities)

2) Scrutinise the impact and responsiveness of central government policy in the regions (ensuring central government policy takes account of regional diversity)

In addition this form of scrutiny should observe some fundamental principles, namely:

• Focus on advancing regional development

• Resist examining structures and processes, which will inevitably differ from region to region.

• Share good practice where appropriate, but seek to avoid imposing it uniformly, unless there are strong arguments for doing so.

Regional Funding Allocations

The Northern TUC welcomes the Government's commitment to a second expanded Regional Funding Allocations exercise, particularly the announcement of further transport funding streams. Such flexibility will enable regions to provide comprehensive advice on the best way to achieve integration, including promoting greater synergy between spatial levels. However the Northern TUC notes with concern that Government is an adherent of 'following the numbers' in regard to transport policy, giving only a 'a very conditional commitment' to funding proposals prior to the construction phase, and prioritising those schemes where the benefits extend to more than one region. The Northern TUC understands Government must focus spending on maximising economic growth and be able to demonstrate a significant return on public investment. However it is also imperative that national policy recognises transport as an important catalyst of regeneration. Therefore investment criteria should be weighted to reflect regional disparities and appreciate capacity to deliver critical mass will be variable.

Furthermore the Northern TUC shares partners' concerns regarding the scope to influence how funding is targeted, given that the ERDF programme has already been agreed and a number of regeneration budgets are ring-fenced. Genuine flexibility is needed to align funding to regional priorities.

Integrating Regional Strategies to Promote Growth

The Northern TUC agrees the regional strategy needs to cover the elements in paragraph 4.13. However the inclusion of learning and skills is considered vital to support the delivery of key outcomes. The Integrated Regional Strategy will play a critical role in ensuring national priorities are sensitive to the needs of the regional economy, helping to shape a demand led system in the interests of learners and employers. It is essential that people can access learning, training and development opportunities which are in step with regional economic demand and economically valuable i.e. capable of generating maximum rate of return on investment. In a demand led system it is important that individuals are able to make informed choices based on the job and career opportunities available to them within the regional economy. The system should also be sufficiently agile to meet the needs of employers in a flexible way appropriate to local circumstances. Subsidiarity should be a cross cutting feature of Government policy underpinned by simplified, robust regional governance infrastructure acting as a pivotal link joining up sub-regional, regional and national agendas.

Process for Developing the Integrated Regional Strategy

Stakeholder Engagement

In regard to the process for simplifying preparation of the regional strategy, the Northern TUC wishes to make some key observations linked to the guiding principles outlined.

To foster meaningful stakeholder engagement and a shared commitment to the strategy and its delivery, the Northern TUC suggests the RDA and Local Authority Leaders Forum lead on its development supported by the Integrated Regional Strategy Advisory Group, Sustaine and a consortium of local authorities. The draft strategy should be subject to an initial round of consultation with economic and social partners before being refined and signed off by the RDA, Local Authority Leaders Forum and respective Secretaries of State.

Regional Flexibility

Firstly we agree that regions should have the flexibility to determine their own detailed processes.

Effective Stakeholder and Public Engagement

Secondly we also agree that effective engagement with stakeholders and the public will be critical to ensuring that competing demands are integrated and the strategy commands support across the region. For this reason the TUC advocates emulating the SHiNE process - a technique used to stimulate long-term strategic thinking about the future of the region in the context of the Regional Economic Strategy. The purpose of the project was to address the need for ongoing strategy development to ensure that regional policy continues to be fit for purpose, inclusive and deliver improved outcomes as a result of intervention. An independent evaluation revealed the exercise was highly valued by stakeholders leading to key successes in a number of areas. The process:

• Engaged a broad cross-section of representation and the positive experience of listening to and learning from other participants enhanced overall levels of awareness and understanding of the North East, which helped to improve the quality of regional strategic thinking.

• Helped people and organisations prepare for future challenges likely to affect the region and anticipate how to deal with them.

• Generated greater collective responsibility to govern the future of the North East, evidenced by improved partnership working and co-ordinated decision-making.

• Designed to explore what the region needed to do to improve its economic future, the SHiNE process challenged inherent assumptions about partnership roles, responsibilities and resources, enabling stakeholders to embrace and manage change.

• Raised the level of ambition in the region and marked a shift in approach towards a more holistic view of the region's development.

Returning to SHiNE would enable the region to meet key Government objectives at an early stage. It would provide a complementary rationale for the development of a change management programme to facilitate the desired changes to institutions, relationships and processes. This approach is likely to prove more successful because it has secured buy-in from stakeholders who trust and have confidence in the process. Although the TUC endorses the SNR ethos of achieving progress through change, it is vital the region maintains ongoing bi-lateral stakeholder relations, creating opportunities to develop good practice by exchanging views and experiences.

However in taking this proposal forward further consideration needs to be given to how the SHiNE process fits within the context of other major national, regional and sub-regional policy initiatives that will impact on and interlink with the Integrated Regional Strategy. Moreover, participants in the SHINE process tended to be from organisations with a high level of involvement in shaping policy design. While this may still be appropriate in relation to developing the Integrated Regional Strategy, an emphasis on improving the effectiveness of delivery means that strategists will need to ensure regional policy is fit for operational implementation. This will require partners to articulate a clear vision, translating policy into a defined role for delivery agents. Therefore it is crucial that the RDA retain responsibility for ensuring and enabling meaningful stakeholder engagement takes place with economic and social partners, as well as statutory bodies, so that the objectives set for the region are deliverable.

A Robust Evidence Base

Thirdly, constructing the evidence base to underpin and inform development of the Integrated Regional Strategy should be led by NERIP; an organisation with a strong track record of enabling partners in the North East to pool resources, share intelligence, analyse evidence and commission research on issues of regional significance related to economic development. Adopting this approach would enable the region consolidate and develop further good practice in supporting partners to utilise a common evidence base from which to develop their own robust strategic and operational focus on promoting sustainable economic development.

Fourthly the requirement to produce an effective sustainability appraisal should be undertaken by Sustaine, an independent body for sustainable development in the North East. Established in 2005 the organisation has sought to promote sustainable development throughout the region and has acquired a good deal of experience working with policy makers in public agencies, local government and private business to mainstream this agenda within their strategies, plans, structures and processes as part of their day to day work. As the lead body responsible for constructively testing regional policy and strategy from a regional development perspective, the Northern TUC is believes Sustaine is ideally placed to scope the issues, appraise the options and report on how the results of the appraisal will inform decision-making.

Independent Testing of the Strategy in Public

The Northern TUC is of the view that local authorities should arrange for the strategy to be tested in public. However, the region should seek to avoid the protracted EiP process currently applied to the Regional Spatial Strategy. A key challenge in moving to a new Integrated Strategy is to develop an inclusive process that enables all sections of society to participate. Taking between two and three years to establish a regional strategy is cumbersome and inefficient, not to mention ineffective as much can change in a short period of time. The Northern TUC would favour a parallel process, which enables public participation and scrutiny as the Single Strategy is being developed. We would see local authorities as being key agents in securing public engagement.

Briefing document (2,500 words) issued 16 Jul 2008