On December 10th EDAS hosted a second Inclusive Growth Community of Practice event, this one on local and regional inclusive growth. The speakers at this event were Professor Duncan MacLennan, University of Glasgow, David Waite, Policy Scotland, Derek Whyte, Assistant Chief Executive of Preston City Council, and Andy Milne, Chief Executive, SURF. The event was held in Govan, Glasgow. Below is a summary of the speaker presentations, with links to their slides, as well as an outline of the facilitated discussion which followed the presentations. The event was chaired by EDAS Board Member Ewan Mearns.
Professor Duncan MacLennan cautioned against focussing too much on defining and measuring inclusive growth and suggested that instead focus should be on how to make inclusive growth work on the ground.
— EDAS (@edas_scotland) 10 December 2018
Discussing the move towards a focus on inclusive growth, Duncan MacLennan indicated that historically inclusion and growth have been treated separately. He pointed out that it was in the 1980’s and 90’s that sociologists began speaking about economic exclusion and stated that it was during the 1990’s that social inclusion became part of the discussion.
He suggested that today’s revived interest in inclusive growth is indicative of economics taking inclusion seriously again. However, he added that the present interest in inclusive growth is mainly top-down and is being led by regional economists. He suggested that there is a potential argument that the current approach to inclusive growth is dedicating too much time to create a single, economic policy narrative. He suggested that inclusion, productivity and well-being need to be connected.
David Waite indicated that the inclusive growth agenda raises questions about how we strike a balance between growth and distribution. He highlighted the empirical work which tells us that greater equality tends to lead to longer periods of growth, and suggested that the idea that there is harmony between equality and growth needs to be rethought a little. He indicated that this aggregate relationship may not play out for particular localities, nor for particular interventions.
David Waite stated that inclusive growth policy needs to be place sensitive and needs to tackle diverse development trajectories. He suggested there is a need to move past the false binary of people vs place. He suggested that shaping the effects of the capital infrastructure system is one means of bringing about more inclusivity.
Discussing City Deals, he questioned the extent to which they effectively establish parity between inclusion and growth. He concluded that there is still some way to go for inclusive growth to become a mainstream feature of the policy prioritisation process.
You can view the slides used by Duncan MacLennan and David Waite here.
A participant suggested that there have been too many confused concepts clouding the inclusive growth agenda, which has made it difficult for practitioners to engage, although it was suggested that this has been improving. Another participant indicated that currently unequal places are being treated as though they are equal, for example through City Deals. Duncan MacLennan acknowledged these points and indicated that decisions have been made, through mechanisms like the City Deals, about which spatial areas to support and what trade-offs this will involve. He added that at present the mechanisms and institutions needed to support making these trade-offs are not in place.
A participant asked whether there are any specific actions or examples that practitioners can use to help them with delivering inclusive growth. David Waite responded that when it comes to making the necessary trade-offs, politicians need to be clear about what the choices are. Duncan MacLennan added that every Local Authority should be auditing what they do in terms of Inclusive Growth and thinking about how austerity has led to different opportunities for thinking about service integration. He suggested that there could be a much better approach to integrating services. He stated that players besides the Local Authorities should be involved in this process, indicating that agencies like Housing Associations need to be more centrally involved.
Discussing towns, Duncan MacLennan stated that these should not be left out of the discussion. He suggested that a network of towns should be established in each region and that this network should be supported by regional partnerships and have representation on the Board of these partnerships. David Waite suggested that it would also be helpful to try to assess and learn to what extent City Deals have incorporated aspects of inclusive growth. For example, he asked how the inclusive growth agenda has shaped capital funding taking place as part of these deals.
Derek Whyte suggested that a consequence of the recession following the 2007/8 financial crisis has been a systematic failure in the 21st century model of capitalism. He indicated that in response to the effects of this in Preston, a ‘democratic economy’ has been emerging. Examples of this include Preston’s anchor strategy – which aims to increase spending on local suppliers by the areas large institutions; a £100m place-based investment by Lancashire’s local government pension fund; Preston’s Cooperative Development Network – through which cooperative and employee owned businesses are being expanded; and work to establish a Lancashire Community Bank. Mr Whyte indicated that Preston City Council is now also an energy supplier with a neighbouring authority.
— EDAS (@edas_scotland) 10 December 2018
Discussing community banking, Mr Whyte indicated that the Bank of North Dakota, in the US, has been successful in making investments in North Dakota, which has fared better through the recession than many other US States. He recommended the RSA’s Inclusive Growth Commission website, featuring their ‘Bank in a Box’, which includes all the software and legal documentation for creating a community bank.
Speaking about the Preston Model specifically, Derek Whyte explained that a spend analysis was done of the area, which initially showed only 5% of Preston’s institutional spend being done in Preston. 61% of this spend was leaking to places outside Lancashire. He acknowledged that the goal of local wealth-building should not be hyper-localism, and explained that Preston is not able to provide all the services needed within the city boundaries. Instead, focussing on Lancashire as a region was the approach taken. He indicated that increasing procurement from within Lancashire was a more realistic goal, which was able to gain buy-in from other towns in the area.
Three years after the shift towards local wealth-building in Preston, Derek indicated that 18% of procurement spend was being done in Preston, with only 20% leaking outside Lancashire. He suggested that around 15% of that could be influenced. Of the spend ‘repatriated’, he indicated that more than 70% has come from London and the South-East. He indicated that the aim of local wealth-building is to continue increasing national economic output, but to do so through re-basing how initial spend is spread around by encouraging this spend in places outside Greater London and the South-East.
Discussing Preston’s outcomes, he indicated that its employee participation rate is up and that it has been named as the most improved city in the UK for 2018 by PWC/Demos.
You can view the slides used by Derek Whyte here.
A participant observed that in the case of the Preston model, some of the anchor organisations were private sector organisations. The participant asked how difficult it might be for other areas to replicate this model, and in particular how difficult it might be for other areas to produce analysis like that done in Preston by the think-tank CLES.
Derek Whyte answered that the process of undertaking the analysis itself is not complicated. He indicated that CLES is due to produce a how-to guide in the new year. He added that getting buy-in at a senior level is the most important thing and stated that he had been surprised by how easy it was to get buy-in in Preston. He acknowledged that he is not sure how easy it will be to get this buy-in in other areas which might not have as strong a sense of local identity. He pointed out that for Preston, once there were senior people on the board the major benefit of CLES was to provide independent security and control for anchor organisations in respect of their data.
A participant indicated that in Fife there are two views of procurement, one which sees it as a provider of savings and another which sees it as a driver of growth. The participant asked whether the same is true in Preston.
Derek Whyte responded that each individual anchor organisation has its own pressures but noted that they will all be looking to squeeze savings out of their procurement. He stated that the ‘pitch’ to give is that switching to local providers isn’t going to cost anymore – no one should have to pay a premium for buying local.
Andy Milne stated that the idea at the centre of SURF’s thinking is that exclusive growth is expensive and ultimately detrimental to all. He indicated that the Scottish Government’s 2011 National Regeneration statement remains its most recent strategy on regeneration. Its marked shift to community-led approaches was largely as a result of reduced resources for top-down initiatives, following the 2008 economic crisis. SURF’s view is that community-led regeneration can only be significant and sustainable when it is effectively connected with where bigger decisions are being made and bigger resources being allocated.
— EDAS (@edas_scotland) 10 December 2018
SURF’s Alliance for Action is an attempt to improve life, conditions and opportunities in specific places. The process of building an ‘alliance for action’ involves going into places and trying to pull all the actors in the area into an alliance. As part of this process, SURF facilitates cross sector agreement on no more than three over-lapping shared priorities for regeneration. The aim is then to enhance local practical cooperation and accelerated investment from higher-level, national partners.
Speaking about the Govan focused Alliance for Action, Andy Milne explained that its shared priorities are physical infrastructure, assets and heritage, and creative community participation. He emphasised that the wealth of local knowledge and information provided by local people in Govan is a huge asset.
Andy Milne indicated that linking local aspirations and assets to national agency organisations with expertise and resources is central to more substantial and sustainable success. He suggested that the horizontal connections formed at the local level need to be appropriately joined up via vertical connections with activity and planning at the regional and national levels.
A key feature of SURF’s Alliance for Action model is testing whether and how local regeneration can be successful in the context of wider challenges. The first task is one of encouraging collaboration between partners at the local level. He suggested that a benefit of this approach is that it allows people to understand why their partners might not be able to deliver what others thought they should be able to deliver. That greater shared awareness helps partners to understand the difficulties that one another face and allows them to be more reasonable and realistic about what they can expect from one another. He suggested that there is generally a need to have more honest and frank discussions on possibilities and limitations, rather than simply creating projects processes which cannot adequately address substantial, shared regeneration challenges.
You can view the slides used by Andy Milne here.
A participant asked what is meant by assets. It was suggested that there is a need to engage with communities more closely in order to understand what is meant by assets, as assets are not the same across the UK. Andy Milne also indicated that it is important to contextualise assets and to ensure that these are productively linked to agencies capable of bringing more substantial and lasting change.
A participant pointed to work being done by the Improvement Service on the role local authorities play in regional development. This work analyses the rates of employment by councils from the most deprived areas and looks at where in councils the people from these areas are being employed. This work shows that where people from these deprived areas are employed by councils, they are usually in low-paid, part-time roles. It was asked how council assets can be better utilised. It was suggested that there is a need to get more value from the public sector and indicated that this can be done without growth.
Inclusive Growth: Where Are We Now?
Participants began by discussing how inclusive growth is to be understood and explained. A participant asked the question: ‘do we, as an economic development community, understand the notion of inclusive growth?’ It was observed that inclusive growth covers a wide range of areas and topics and can mean different things to different people and groups.
Concern was expressed about the relative lack of integration of inclusive growth objectives within the Glasgow City Deal. It was suggested that this may partly be because no-one really understands how to asses or monitor the delivery of inclusive growth objectives. It was also suggested that this may be due to the limited time given to develop bids (12 weeks). There’s also a strong focus on infrastructure spend (£1.1bn) at the expense of employability (£9m). It was observed that there is little spatial targeting of City Deal projects in specific communities. Challenges and opportunities are not distributed equally – so spatial targeting has to be part of the solution. The approach taken by Renfrewshire Council in recent years, for example, has matured so that they clearly recognise the importance of prioritising geographic neighbourhoods. It was suggested that there opportunities to “retrofit” a stronger focus on inclusive growth in the Glasgow City Deal via, for example:
• Ensuring that local people, contractors and suppliers can access opportunities once the infrastructure projects are operational
• Finding ways to connect local communities to specific projects/opportunities eg the focus on Ferguslie Park’s ‘9 streets’.
It was suggested that inclusive growth is really about social infrastructure and making the most of opportunities to build on local knowledge and skills. Asset-based community development is a part of this, but the question was asked: ‘how can this message be shared with communities in a helpful way?’ The point was made that in order to get people’s attention there needs to be an accessible language around inclusive growth that everyone can engage with. The point was raised that the terminology of inclusive growth makes it difficult to try to engage the business community, as many of them don’t understand what inclusive growth is. It was suggested that there are already a lot of people doing inclusive growth but that they don’t know they are doing it. The goals it seeks to achieve are simple, but these need to be made clearer.
Inclusive Growth: Where Next?
It was suggested that any efforts to deliver inclusive growth need to be evidence-based from the outset. Regional partners need to have clear understandings of the challenges they are facing in their regions. Without this evidence and understanding, conversations about what to do can become contentious. Participants indicated that evidence of things that have worked in the past will be useful and the suggestion was made that going back over past initiatives in different areas to see what has and has not worked would be a useful exercise.
It was added that there also needs to be greater understanding around what needs to change in terms of the status quo. It was felt that a shared directive on where the inclusive growth agenda wants to go is needed, but that this should have the flexibility for practitioners to respond in the ways most relevant for them and their region. It was observed that national agencies struggle to engage locally. Given that local engagement seems to be important for inclusive growth, it was asked what national agencies need to do to facilitate this engagement and how they can ensure they are engaging widely enough, rather than just engaging with the same voices all the time.
Discussing how spend can be localised, it was observed that one barrier to localising spend is that many local companies are not currently on public sector procurement lists. Renfrewshire Council has already started to address this, awarding 50% of contracts up to £50k to local firms. It was suggested that a two-tiered approach has been allowed to develop whereby neighbourhood-level and city region-level initiatives are both thriving but there are relatively weak connections between them. There are great opportunities to find productive connections including:
• Connecting community development trusts across Glasgow (and elsewhere) to form a community wealth-building network
• Aggregating community-level investment opportunities across the city to a level that would be attractive to institutional investors, perhaps co-investing with the Scottish Investment Bank
• Valuing our natural assets (parks, green spaces etc) and connecting these assets to create greater scale (i.e. building natural capital)
Thinking about assets, participants suggested that there needs to be a conversation in each region about what its assets are and what they will be going forward. It was suggested that practitioners need to think about developing assets that can grow with a community. It was felt that a working group around assets could help with this, to develop and deliver local services that are revenue generating. The point was made that all councils and communities will have assets and so will need to know what these are and what services can be delivered at the level of the community. It was suggested that local authorities could carry out audits of their assets and how these are being/can be used to deliver inclusive growth. The question was raised as to who decides what counts as an asset, and the suggestion made that communities could be asked what their aspirations are and these used to work out where there useful assets lie. The Town Centre First initiative might be a good example of this, showing clear connections between local regeneration and economic policy.
Alongside proper identification and exploitation of assets, it was suggested that there is a need to demonstrate to business what that positive impacts of inclusivity are, and to develop more positive ways to engage with inclusive growth objectives. There should be increased focus on assets and aspiration, rather than deprivation and deficits.
Speaking about what works in Scotland, it was suggested that there is a need for a leadership that is aligned to what practitioners are trying to do in terms of delivering inclusive growth. It was suggested that alignment with the goals of inclusive growth needs to be present at each level. It was felt that quality people leading this agenda are required in local authorities and that clear leadership is required at each level – national, regional, local and at the community level. It was observed that there are more institutions in Scotland than in England and that leadership is more fragmented. It was suggested that there is a need in Scotland to make local government attractive enough to retain good people. It was observed that in Scotland, there is a tendency for good people to move to national (UK) level politics. It was suggested that a leadership which promotes good relationships is vital.
Participants finally offered their suggestions for what they thought might make the most difference in delivering inclusive growth. Their answers included:
- Changing how we measure performance improvement. Spatial variations are lost in averaged targets – so rather than focus support on making the ‘best’ areas even better, why not set a minimum performance threshold so that improvements in the ‘worst’ performing areas are given the biggest boost?
- Better coordination at different levels e.g. community and city region
- Better story-telling around the benefits a move towards greater inclusivity.
- Making sure we understand the assets of a place properly so that these can be made best use of.