The document discusses challenges facing efforts to reduce economic disparities between regions in England. It notes that while the goal is to narrow gaps in growth rates, economic performance has always varied between cities and little progress has been made. Barriers include a lack of consensus around the role of core cities, artificial administrative boundaries, and departments prioritizing different approaches. Resolving tensions between priorities of growth places versus places in need remains difficult politically.

1. From the OECD Review of
Newcastle to the Sub National
Review: What real hope for
reducing disparities?

2. Public Service Agreement
Delivery Agreement 7
2008/09-2010/11
‘Improve the economic
performance of all English regions
and reduce the gap in economic
growth rates between regions’
HM Treasury (2007)

3. ‘Government regional economic policy aims
to narrow the gap in growth rates across the
country. But this fails to recognise that
economic performance has always been
uneven. The ranking of cities’ economic
performance has changed little over the
years - cities have always grown at different
rates, and they always will. Despite a long-
term commitment to regional convergence,
and billions of pounds of investment by
RDAs, Local Authorities and other public
bodies, little progress has been made’.
Centre for Cities (2010) Cities Outlook 2010 page 17

4. North East GVA
where UK =100
86.0
84.0
82.0
80.0
78.0
76.0
74.0
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
ONS Regional GVA from www.statistics.gov.uk

5. GVA 2008
where UK =100
180.0
London
160.0
140.0
120.0
100.0
80.0
North East
60.0
40.0
20.0
0.0
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

6. GVA Durham & Tees Valley
where UK =100
85.0
80.0
75.0
70.0
65.0
60.0
19 95
19 96
19 97
19 98
19 99
20 00
20 01
20 02
20 03
20 04
20 05
20 06
20 07
ONS Regional GVA from www.statistics.gov.uk

8. OECD Review of Newcastle in the North East
• Central government is the dominant actor in regional
economic development
• Collective action and identity appears to be as much
rooted in localities and different cities within the region
than the regional level, with internal and inwards
looking divisions and animosities appearing to
dominate. The basic conditions for building a mode of
governance are therefore not strong
• There is, of course, no single best level for government
organisation anywhere. Nevertheless, there is evidence
from other OECD countries to suggest that governance
arrangements at a metropolitan or functional urban
level make sense for issues such as housing, transport,
economic development, culture, organisation of retail,
environment, universities, and land use planning

9. OECD Review of Newcastle in the North East
• The reality is that not all communities will benefit equally from the
region’s growth…..it is for example clear that growth is coming form the
urban core of the region and this is likely to continue.
• The concentration of growth and related resources in the City of
Newcastle (and Tyne and Wear County) suggests that in building the
critical mass, the city region should strengthen the role of the urban core
as the growth centre in building the critical mass.
• A focus on high technology sectors suggests a spatial concentration of
development in the urban core of the region, with an accompanying
transport strategy so as to improve the connectivity in the region and
beyond, thereby enhancing the spatial mobility of the population
• [However] there is an ambivalence and lack of consensus in the region
about the role of Newcastle in the region’s future.
• Finally, as the strategy requires choices to be made as to where (and
where not) to put resource, a high degree of transparency in decision
making, and political support are required

10. Increase in GVA 2006-07
6
5
4
Percentage
3
2
1
0
Hartlepool and South Teesside Darlington Durham CC Northumberland Tyneside Sunderland
Stockton-on-Tees
ONS Regional GVA from www.statistics.gov.uk

11. Growth in GVA 2006-2007 at Current prices
800
700
600
500
£ million
400
300
200
100
0
Hartlepool and South Teesside Darlington Durham CC Northumberland Tyneside Sunderland
Stockton-on-Tees
ONS Regional GVA from www.statistics.gov.uk

12. Headline GVA at Current Prices
16 000
14 000
12 000
10 000
£ m illio n
8 000
6 000
Hartlepool and Stockton-on-Tees
4 000 South Teesside
Darlington
2 000 Durham CC
Northumberland
Tyneside
0
Sunderland
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

20. Sub National Review
• Streamlining the regional tier; including Ministers for the Regions, Regional
Grand Committees, Regional Select Committees, abolition of Regional
Assemblies ‘in their current form’, RDAs to prepare Integrated Regional
Strategies?…local authorities to have stronger role of scrutiny over
RDAs…a new regional Forum of Local Authority Leaders
• Delegation of RDA funding to local authorities ‘where capacity exists’
• A new statutory economic ‘duty’ for local authorities. Support for
establishment of City Development Companies; use of Local Asset Backed
Vehicles, Supplementary Business Rates, Working Neighbourhoods Fund
• Encourage groups of local authorities to develop ‘Multi Area Agreements’
to agree collective targets for economic development
• Allow ‘sub regions’ to strengthen sub regional management of transport
• Allow groups of neighbouring local authorities to establish statutory sub
regional arrangements

21. Sub National Review: A Critique
• To strengthen ‘every tier’ and ‘all local authorities’
• Effecting spatial prioritisation within new Integrated Regional Strategies?
Led by economic policy or by land use?
• What role for Ministers of Regions? Regional Forum?
• Delegation of RDA funding to local authorities….for what purpose? …
and on what basis? … who determines capacity?
• Core Cities not mentioned despite showing strongest growth
• What is it to be? city regions or sub regions? or neighbouring local
authorities working together?
• MAAs …no statutory or financial basis…no money….so what motivation
to change behaviour or prioritise on a spatial basis?

22. Problems for Central Government
• Legislative: Retrenchment of institutional positions during
lengthy passage of primary legislation. Quasi judicial role of
RSS. Implications of general election?
• Departmentalism: What real traction from Depart. Communities
& Local Government compared to HM Treasury, Cabinet Office,
DBIS, DWP? What impact of revolving Ministers?
• A real shift of spatial prioritisation during cycle of fiscal
tightening?
• How to reconstruct RDAs to perform a new and different task?/
What role for Government Offices in the Regions?

23. Problems at the Sub National Level
• Local government of limited leverage, financial capacity & freedoms
• In the absence of more elected Mayors, how to build capacity of risk
averse local authorities?
• Continuing artificial administrative boundaries (and establishment of
unitary county authorities in some places)
• No power hierarchy of local or regional agencies of government
• Much local delivery through agents of national government (LSC, Job
Centre Plus, Homes & Communities Agency, Universities, Regional
Development Agencies etc) driven by central demands; lacking legitimacy
to make difficult spatial decisions
• What relationship between Local Area Agreements and Multi Area
Agreements?

24. Bigger Problems?
• Unresolved reconciliation of traditional (HMT led) neo-liberal supply side
‘people’ & ‘firm’ economics with growing importance and political
transparency of ‘place’ economy
• Investing in places of growth & opportunity, or in places of need
regardless of opportunity?
• Managing the apparent retreat (of some departments) from the regional
level and easily from explicit target to Reduce Regional Disparities
• Managing political and parochial aspirations of heavily represented rural
areas, formal industrial and coastal towns, suburban areas etc
• Political gain or political pain?
• …..as the government maintains the massive scale and economic
importance of London and greater South East by quietly pouring cash
into London & South East e.g. T5 & Runway 3 at LHR, High Speed 1,
expansion at Stansted, Cross Rail, Olympics, Thames Gateway etc