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LEPs: A Primer


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A Presentation prepared to inform participants in the inaugural workshop about the proposed Fylde Coast LEP on the role and purpose of Local Enterprise Partnership

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LEPs: A Primer

  1. 1. LEPs: A Primer LOCAL ENTERPRISE PARTNERSHIP FOR THE FYLDE COAST: Workshop on LEPs Marine Hall, Fleetwood FY7 76H Thursday 26th August, 2010 Ged Mirfin – Chief Data Officer, BLNW
  2. 2. Centripetal Localism Business led Corporatism Centrifugal Localism Municipal Corporatism Different Models of Local Economic Partnerships LocalGovernmentInfluence Local Business Influence
  3. 3. LocalGovernmentInfluence Local Business Influence Clear demarcation between Nationally Delivered and Financed Services & Tax Raising and Locally Delivered and Financed Services & Tax Raising. National Priorities to be determined centrally but Local Priorities to be funded by enhanced Local Tax Raising Powers provided the General Public and Business can be persuaded politically. (Layfield Principle) Creation of “Keiretsu” like Enterprise Partnerships with very high levels of close knit co-operation cooperation between manufacturers, suppliers, distributors, banks and local government with active acquiescence of trade unions and employer engagement and participation Public Sector Dominated Private Enterprise Partnerships. Business represented in an advisory capacity. Invited/Nominated Private Sector Boards. Creation of Powerful Civic Associations. Return to Civic Improvement Model with Public Sector & Big Business Working in True Partnership to 'park, pave, assize, market, gas & water and improve'. Public Sector Prominence or Business Dominance? A keiretsu is a grouping or family of affiliated companies that form a tight-knit alliance to work toward each other's mutual success. The keiretsu system is also based on an intimate partnership between government and businesses.
  4. 4. LocalGovernmentInfluence Local Business Influence National strategies will be decided and targets set and monitored centrally with little room for interpretation locally. Local priorities and targets will be largely determined by budgetary constraints and political administrative regulation. Initiatives will be agreed on the basis of satisficing rather than negotiated settlement. Business Support Strategies will reflect the needs of the “Keiretsu” . Funded Apprenticeships and Specialist Training will be High Priority. Training Regimes are likely to reflect the needs of the Growth Businesses. Education and Training will become much more Business Focussed. There will be a much greater focus on identifying and backing winners at the expense of poor performing cos. Re-launch, Re-packaging, Re- branding, Re-positioning of Existing Business Support Products and Services under another name/guise because it is too difficult to dismantle existing policy programmes. Local Business Support Policies tailored to fit local need. Business Support Products and Services will reflect demand-pull from local businesses as well as local economic need. Trade-offs will need to be made between the imperatives of business growth and town and neighbourhood renewal Enterprise Partnerships: Business Support or Supporting Business?
  5. 5. LocalGovernmentInfluence Local Business Influence Government will have to make some invidious choices about which high growth geographies to support. This may result in Widening Performance Gaps between Affluent and Deprived Geographies . Disempowering Local Government may hasten decline in areas where support from Local Enterprises is already weak. Creative Destruction – Pursuing a High Growth Strategy is likely to hasten the demise of existing declining industrial sectors. Continuous Change Management of a High Growth Enterprise Strategy on the scale envisaged has not been attempted since the Victorian era. There are however lessons we can learn from recent experience Politicians are accountable to the Electorate. Big Business is not. The Representative Test is in achieving Sustainable and Lasting Economic Development which will bring prosperity to the greatest number. Balancing the needs of Business and Society especially a Big Society will require Politicians to become more Pro- Business even at the expense of Social Cohesion – some geographical areas will lose out and Business to exhibit more Corporate Social Responsibility accepting limits to growth Spatial Geography: Competition between LEPs will accelerate the performance gaps between High Growth and Low Growth Local Economies
  6. 6. LocalGovernmentInfluence Local Business Influence Centrally appointed Political appointees parachuted into post on the basis of political preferment. Reputation (Political and Media) will necessarily be more important than administrative managerial skill-sets . Behaviour will ultimately be determined by relationship with political masters at the centre. God is on the side of the Big Battalions. Political and Economic Influence will be determined by the relative strength of individual networks. There will be a strong overlap between specific Industry Sectors and the Geography in which they operate. Business Primes will become the de-facto voice of Economic Geographies. In an increasingly globalised world however the needs of business will predominate over local economic development. Nominated Boards of Business Representatives appointed/co- opted for fixed terms. In order to comply with Employment Legislation Posts would have to be advertised. Politically co- opted Members would be subject to scrutiny. Local Business Boards. Method of Selection as yet unclear. Despite preference in certain quarters that Board Members will be Voice of Membership Organisations : Chambers, FSB, CBI, IoD, FPB or directly elected by Business Community itself will involve Representative Test which will ultimately involve observance Employment Legislation. Most likely outcome will be messy reality involving Employed (Salaried and Non Salaried), Appointed, Elected and Representative Board Members. Democratic deficits will abound. Representative Test is success! Governance: Business Representatives or Representing Business?
  7. 7. LocalGovernmentInfluence Local Business Influence A Strong Business Presence will give legitimacy to the idea that Government Policy is driven by a Pro-Business/Pro- Private Sector Ideology whether this is true or not. Reality will need to be as strong as Appearance with Government supporting an expansion in Private Sector Employment to replace Jobs lost in the Public Sector as spending cuts bite. Political Needs will always be subsidiary by those of Business. Oligarchical Politics of this nature sits uneasily with the British political culture and is profoundly anti- democratic. The current level of mistrust of Financial Institutions specifically and Big Business in general will prove a major stumbling block. Meritocratic sensibilities will mitigate against the establishment of an impenetrable and inaccessible elite. The more likely outcome will be a reinvigorated Private Sector supported by a more locally based Financial Services Sector which is more responsive and attuned to the needs of high-tech manufacturers Local Government will utilise the skills and experience of Business to secure additional funding from Central Government in a Competitive Bidding situation. Business will follow the lead of Local Government as political priorities dominate. Business input will need to be canvassed thoroughly in order to provide the Enterprise stamp of approval. There will be a direct trade-off between the short-term self-interest of Businesses: Access to Finance; Training & Skills, Supply Chain Network Access, Infrastructure inc. Transport Infrastructure Investment, Cutting Red Tape, a Favourable Taxation Regime – and the wider mutually co- operative aim of working together to build a favourable economic environment in which Businesses can grow. Such an enduring level of political commitment may ultimately prove frustrating, conflictual and politically divisive against the backdrop of a competitive political landscape particularly competition between individual LEPs. Business participation may ultimately prove unrewarding. Business Involvement or Involved Businesses?