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
relative
to%UK,
p.a. %
1997-2007,
UK Independent
average, South East average,
M3, >EM3
forecasts/projections
Relative
productivity
performance
• -30
Uk economic growth around 0.8% in Q3
GDP
per hour worked, 2012
UK
– Driven by consumer spend
SE
-20– Expected
to continue into Q4 and 2014/15
EM3
– Forecast
good for Hampshire and EM3
C2C
• -10
Challenges for the longer term
Hampshire
– Significantly slower growth over the next decade….
Oxfordshire
0 employment driven growth affected by ageing
Surrey
population, infrastructure constraints, technology,
W.
Sussex
10 industry demand
2013for significant
2014
–Solent
Opportunity
productivity growth…%
1.0 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Source:
1.8 1.9ONS
2.0 2013
2.1 2.2 2.3 2.4
20 compared to others
Jap
Can
Italy Source:
G7
Fra
2014-2024,
% p.a.
Experian
2013
Ger
Note: LEP projections = weighted average of LA projections
US
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 – UPDATE AND
STRATEGIC APPROACH
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
Sustainable Economic Growth: An increase in GVA per head
from 8% above the national average to 10%
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
Innovation
Infrastructure
Increase the supply of
high level skills
A strong science and
innovation sector
Removing bottlenecks to
development and growth
Strategic, cross cutting activity
Advocacy, promotion, influence and alignment
Documents and Funding
Local
Growth
Fund
Strategy for
Growth
Strategic
Economic
Plan
European
Investment
Strategy
Other
funding
(GPF etc)
Growth Deal
Enterprise M3 Strategy for Growth
• 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
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
Enterprise M3 European Structural &
Investment Fund Strategy
• £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?
European Structural & Investment
Fund Strategy
Composed of four strategic programmes:
Enterprise
Innovation
“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”
£9.6m
£7.7m
Skills & Employment
Sustainable Infrastructure
“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”
£16.6m
“To ensure we use our existing
transport
infrastructure better and to develop
and support efficient and low carbon
measures and sustainable transport”
£4.6m
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
London
Originalthan
LGF composition
(housing)
Revised LGF composition (housing)
£400m
– New Homes Bonus
£70mprepared
– New Homes Bonus (London only)
– Revised
fund composition
£110 – Regional Growth Fund
• Bids to Local Growth Fund
£150m – Housing Revenue Account
– Strong rationale and compelling
offer
£50m – Large Sites
– Made through Strategic£380m
Economic Plan
£400m
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
Ho ho
ho !