HAMPSHIRE PARTNERSHIP 11th December 2013 ENTERPRISE M3 – UPDATE AND WHAT NEXT Andrew Lloyd Chief Executive
Programme Economic headlines Enterprise M3 – Working arrangements – Progress Strategy for growth Opportunities
Economic Outlook More Positive Uk economic growth around 0.8% in Q3 – Driven by consumer spend – Expected to continue into Q4 and 2014/15 – Forecast good for Hampshire and EM3 Challenges for the longer term – Significantly slower growth over the next decade…. employment driven growth affected by ageing population, infrastructure constraints, technology, industry demand – Opportunity for significant productivity growth… compared to others UK average, South East average, M3, >EM3 2014-2024, % p.a. 1997-2007, % p.a.
The Economy – Some Mixed Messages Positives – Manufacturing starting to recover – Housing market boost (construction up 1.7% in Q3) – Jobs market strengthening – Inflation falling…but variable (e.g. utility costs) Areas of concern – Relatively low levels of investment – Real earnings continue to decline – Deficit reduction still a huge challenge – Trade balance still a drag on G.D.P. (£5.5 bn in Q2 to £8.9 bn in Q3)
Enterprise M3 Key Statistics EM3 area has a high performing economy Positives include – Highest level of NVQ level 4+ skills among all LEPs (42.4% population) – Leader in ICT, pharmaceuticals, aerospace & defence and professional services sectors Need to support business to succeed Governance framework – in principle agreement – Joint Leaders Board – Review completed
Headline Targets and Themes An Enterprising Area – adding: 1400 businesses p.a. to the area through improved business birth and survival rates 25,000 jobs through an increase in the employment rate from 76.8 to 80% Skills Increase the supply of high level skills Innovation A strong science and innovation sector Infrastructure Removing bottlenecks to development and growth Sustainable Economic Growth: An increase in GVA per head from 8% above the national average to 10% Strategic, cross cutting activity Advocacy, promotion, influence and alignment
Documents and Funding Strategy for Growth Local Growth Fund European Investment Strategy Other funding (GPF etc) Strategic Economic Plan Growth Deal
Sets out vision and broad priorities for growth Based on widespread consultation and research around the needs and opportunities within the area around economic growth Action groups set up to engage businesses and others around the LEP’s activity Forms basis of EU Strategy and Strategic Economic Plan Enterprise M3 Strategy for Growth
Developing the Wider Strategic Economic Plan (1) Will align all funding streams and set out local flexibilities key for local growth Information drawn from various strategies (e.g. skills, information, visitor economy), local authority plans and investment plan for growth Other work following in housing, social inclusion and low carbon Timescales – 17/19th December: Submission of first draft – March: Final submission made for assessment – July: Growth deal offer to LEP’s – April 2015: Funding comes on stream?
Developing the Wider Strategic Economic Plan (2) Areas of focus include: – The Enterprise M3 Sci:Tech Corridor – Areas with Growth Potential – Skills Centres between training providers and business – Improved Local Careers Advice – Housing and Transport investment needed for growth – Growth Hub – new ways of working – Will seek funding from Local Growth Fund
What Can the Plan Do? Key potential advantages of the SEP – Wider commitment to growth – Alignment of local authority capital and revenue spend – Effective collaboration and partnership – Deliver collective decision making – Build a strong relationship with business – Clear and deliverable growth vision – Strong financial backing – Cross local authority collaboration on growth
£39m EU funds allocated to the area from 2014-2020 Strategy sets out needs, priorities and expected outcomes from this funding EU funding must be matched by domestic funding Timescales Final document in January 2014 Issue prospectus in Spring Funding from mid 2014? Enterprise M3 European Structural & Investment Fund Strategy
European Structural & Investment Fund Strategy Enterprise £9.6m Sustainable Infrastructure £4.6m Skills & Employment £16.6m Innovation £7.7m Composed of four strategic programmes: “To support start-Ups, SME growth and ensure a better co-ordinated business support offer” “Build on a rich history of innovation, extensive local infrastructure, and exploit the potential of science and technology industries” “A much better functioning learning market. Activities to prepare for the acceleration in employment From new & replacement demand with a shift towards higher skilled/technical occupations” “To ensure we use our existing transport infrastructure better and to develop and support efficient and low carbon measures and sustainable transport”
Funding Already secured – £39m EU funds – £21.7m growing Enterprise Fund Local Growth Fund – Affected by the provisions in the Autumn statement – New Homes Bonus Allocation not top sliced other than London – Revised fund composition prepared Bids to Local Growth Fund – Strong rationale and compelling offer – Made through Strategic Economic Plan Original LGF composition (housing)Revised LGF composition (housing) £400m – New Homes Bonus£70m – New Homes Bonus (London only) £110 – Regional Growth Fund £150m – Housing Revenue Account £50m – Large Sites £400m£380m
Next Steps Strategic Economic Plan – Clarifying and finalising the draft – Implementing governance agreement – Developing approach to freedoms and flexibilities – Involvement of local authorities – Establishing collective decision making Collaboration with other LEP’s – Part of greater Thames Valley 6 and work with Solent – Working with sectors e.g. Film, digital media Rural: National Parks Cross border transport bodies
Conclusions Economic recovery gathering momentum….but particular risks around rebalancing the economy towards investment/exports Much happening in the sub-region and County – In better shape than many areas Key role of LEPs and EM3 doing well – Strong partnership approach between and within sectors – Focus on delivery – Significant resources being channelled EM3 likely to provide opportunities to make a real difference