The Chamberlain News

Turbocharged Javid’s engine set to roar, but what exactly is the Midlands?

First, we had Chancellor George Osborne’s Northern Powerhouse. Now we have Business Secretary Sajid Javid’s Midlands Engine. Paul Dale asks who’s running the engine and exactly what is the ‘Midlands.’

Both are ministers’ ideas of English regions where adjoining towns and cities have much in common with a shared history and culture. To be credible the powerhouse and the engine must therefore be places where people instinctively think of themselves as Northerners or Midlanders.

It seems obvious that stronger economic regeneration, better transport links, more jobs and improved workforce skills will follow if councils and local enterprise partnerships in these regions can unite, taking advantage of economies of scale and promoting their common economic and business interests to a global market.

To quote Mr Javid:

A region working together is stronger than a handful of counties and cities working in competition. Imagine what we can achieve if local authorities pool their ideas, resources and expertise and work together for the benefit of the whole region?

There are though a couple of obvious stumbling blocks.

The first difficulty is the deep-rooted suspicion that local councillors and MPs across the political divide have for any form of regional government. And while Mr Javid has spoken eloquently about powering up his Midlands engine, he hasn’t yet fully explained who is going to be in charge of investment decisions and the arrangements to be made for public scrutiny.

It is safe to assume there will be a management board consisting of the LEP chairs and key council leaders, but that will be a very large board indeed, possibly 40-strong.

The second difficulty is the issue of identity.

While most people know the north of England is that huge trans-Pennine land mass between Manchester and Liverpool in the west, Leeds and Sheffield in the east, and Newcastle and Teesside in the north-west, no one really has much of a clue where the Midlands is.

This is because the Midlands has never really existed as a separate recognisable entity. Where, for example, does this region start and where does it finish?

The Government thinks the Midlands stretches from Wales to the North Sea and the northern Home Counties to the Peak District, which may come as news to many people.

Is north Oxfordshire in the Midlands or the south? Stoke on Trent looks naturally to Manchester as a travel to work area, but the Government has put Stoke in the Midlands.

Many people in Worcestershire, particularly in the south of the county, see themselves as living in the south-west and identify with Gloucester and Bristol. In south Northamptonshire, meanwhile, the notion of being Midlanders is odd given that London is a mere 45 minutes away on the train.

So if the Government is serious about the Midlands Engine it first must re-invent the Midlands as a plausible, functioning administrative area that can command public support and recognition.

The area it has chosen is huge and takes in 11 local enterprise partnerships: Black Country LEP, Coventry and Warwickshire LEP, D2N2 (Derby & Derbyshire, Nottingham & Nottinghamshire) LEP, Greater Birmingham and Solihull LEP, Greater Lincolnshire LEP, Leicester and Leicestershire LEP, The Marches LEP, Northamptonshire LEP, South East Midlands LEP, Stoke-on-Trent and Staffordshire LEP and Worcestershire LEP.

The number of unitary, borough and county councils in the area must be around 70.

Mr Javid, launching the Midlands Engine prospectus at Birmingham University, eulogised an extraordinary history of invention and culture.

The Midlands is the home of Shakespeare, Lawrence and Larkin. Of Newton, Nightingale and Darwin.

The steam engine emerged from the Midlands to drive an industrial revolution that changed the world forever. The power stations of the Trent Valley give the nation heat and light. The Great Reform Act, which laid the foundations of our democracy, was born right here in Birmingham.

From the Shropshire Hills to the Lincolnshire Fens, the Midlands is the home of the people, products, places and idea that make England English.

It boasts a record of achievement that would be the envy of many nations, never mind regions.

He then rather spoilt his own argument by confessing that the Midlands has no real identity and “has always lacked a sense of place”. Mr Javid continued:

Northerners think it’s in the south. Southerners think it’s in the north. And Midlanders themselves aren’t really sure either way.

On the national stage Midlands is too often used as a synonym for the Birmingham conurbation. And local pride has long trumped any sense of regional identity.

The under-performing economies of the 11 LEP areas selected to carry the Midlands Engine banner demonstrate why the Government must make a difference.

Mr Javid told his audience that a “lack of cohesion and identity” across the Midlands “inevitably leads to underperformance and neglect”.

Between 1997 and 2010, manufacturing output in the Midlands fell from just over £15 billion to just under £12 billion, which was the highest percentage fall of any UK region. Productivity is about 10 per cent lower than the national average. And in 2013, there were 25,000 job vacancies that were hard to fill due to a lack of suitably skilled local applicants.

Addressing critics who suspect the Midlands Engine is, well, a bit of a gimmick, Mr Javid insisted:

It’s not a cheap knock-off of the Northern Powerhouse. It’s not an empty piece of political rhetoric. It’s a real programme to deliver the jobs, growth and productivity that the people of this region deserve.

The Business Secretary said the Midlands Engine initiative could create 300,000 jobs and boost the national economy by £34 billion if the Midlands matched the predicted growth rate for the UK over the next 15 years. Of course, this is a very big if and given the sharply below-average starting position that this region finds itself in, it will surely prove all but impossible to hit the £34 billion target because to do so would require rising above the average very quickly.

The prospectus recognises it is difficult to sell the Midlands to global markets because investors are far from certain where the Midlands is. Branding the Midlands with the aim of “strengthening our reputation across global markets” is proposed, although similar exercises have been attempted many times before with varying degrees of success.

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In partnership with Government, we will undertake a series of trade missions to target geographies under the Midlands Engine banner, to send the message that we are good for the UK and good for business. We are ambitious and want this activity to being in April 2016. Overseas markets with the greatest potential include China, India and the USA.

We will continue to be home to exciting, cutting edge high performance technology, and world-leading research translation facilities.

The Midlands Engine’s food and drink sector will evolve as the UK’s larder. The Midlands Engine will continue to rise to the global challenges in the energy sector.

The prospectus sets out five themes:

Promotion

Promote the region’s strengths, assets and opportunities actively to key target domestic and overseas audiences focusing on sectors that provide the greatest opportunities for the region for inward investment. A consumer-focused campaign for the visitor economy will promote the highlights of the region, specifically around areas including heritage, culture, sport and food and drink. An efficient transport infrastructure will be vital for our business and leisure tourism.

Midlands Connect

Midlands Connect will set out a credible long term transport investment strategy for the Midlands Engine. We will identify early investment to improve road and rail networks and explore how new technologies can increase capacity of existing transport networks.

Innovation

The Midlands Engine will drive up business innovation, improving business productivity and competitiveness. Our universities and business will work together pan-regionally to bring forward innovations that support our key sectors and drive this through the supply chain. We will work with Government to identify where opportunities exist to further our innovation activity across the Midlands Engine.

Finance for Business

Supporting our SMEs to grow will increase employment right across the Midlands and help to diversify our business base. High levels of new company formation and survival are indicative of a strong entrepreneurial culture and ethos within the business and wider community. Access to appropriate sources of finance is essential for businesses to reach their full growth potential and to facilitate the survival of new business start-ups. The Midlands Engine will address this by offering a single and substantial access to finance proposition.

Skills

The availability of a strong talent pool is crucial to enable employers to improve their productivity and grow more quickly. In response to this, the Midlands Engine will work to ensure that the employer base links closely with skills providers and skills provision is tailored to employer demand. This also includes helping our future workforce understand the nature of upcoming employment opportunities and the skills levels these demand. Building on established partnerships and creating new ones, the Midlands Engine will encourage employers and employees to work closely with skills providers.