In March this year, the Business, Innovation and Skills House of Commons Select Committee launched an Inquiry looking into the Northern Powerhouse and Midlands Engine “Powerhouses and engines: Government policy and regional growth”.
The two main powerhouses at the centre of this Inquiry are Government manifesto commitments as set out at the 2015 General Election. City-REDI evidence is set out here. It welcomes the select committee intervention to assist the development of government policy and delivery, including the important question about the relationship with emerging devolution arrangements within these areas.
It ‘argues that the ‘elephant in the room’ is that nobody knows what is really meant by a ‘powerhouse’ but argues that you might know one when you see one. It suggests London is certainly the primary if not the only existing economic ‘powerhouse. It supports the aim of building on agglomeration and differentiation across the Midlands and in the North as ways of both rebalancing and growing the national economy and its competitiveness but recognises the ‘lock in’ around London. It highlights the ‘fuzziness’ around powerhouse policy and strategy. It argues that powerhouses have a major role to play, particularly in scaling and ‘packaging’ these areas as brands for attracting investment, trade and supporting industry, science and innovation. It also supports a collaborative approach between powerhouses and elected mayors and devolution, where powerhouses act where there is added value in these areas from pan-region interventions but to avoid replicating the role and functions of elected mayors, combined authorities or local enterprise partnerships. Powerhouses should try to avoid building another tier of governance but act on specific strategic issues in a lean and inclusive way such as marketing the automotive sector and improving its sourcing of supply chains or supporting the expansion of Birmingham Airport.
City-REDI welcomes the decision of the Select Committee to add industrial strategy to its remit, in light of the focus and ambitions of the new Government and intend to submit further supplementary evidence in response.