Can Productivity Bring Around the Change We Need in Places?

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Rebecca Riley recently attended an RSA Urban Futures Roundtable looking at the potential of the UK’s cities. In a series of blogs, Rebecca reflects on the challenges facing places in building regenerative economies.

This blog is for the Local Policy Innovation Partnership Hub which launched early this year. The Hub seeks to address nationwide issues through local partnerships and places. It is a national consortium led by the University of Birmingham and funded by the URKI.

In the final blog in the series, Rebecca asks whether productivity growth is enough to create the places we need? Should this idea drive policy to improve places?

Read the other blogs in the series.

Given the broad functions cities perform as detailed in the previous blog, should productivity growth be the sole driver of change?

Not a lot of change

Policy has been tackling productivity disparities for decades and not a lot has changed. So, cities must think hard about what they can do to make a difference. The public sector overall does not directly affect productivity in the business landscape, it can create the conditions for growth though. Through some of the interventions listed in the previous blog, the public sector can innovate and change the way places, residents, services, and businesses interact, which can affect the productivity, well-being, and wealth of places.

National and local demands

Many policies are decided outside the influence of cities and their leadership, so national politics and policy approaches are central and influential as the list above shows. Adopting a city strategy that tackles all these policy areas, which we know are important, needs to take account of national policy and local demands.

Reviewing the geographical level of policy interventions

Cities need to work with their neighbouring suburban and rural areas and negotiate with the government to ensure investment and policy change which works to respond to the potential innovative interventions for wider place growth. However, as one of the most centralised countries in Europe, there is less scope for cities to influence and drive change as they lack the real levers or ability to deliver the range of programmes mentioned above. We need to review the geographic level of policy interventions, so they enable cities (and the hierarchy of places) to drive changes for future growth.

A Place-based approach

The challenge of a productivity-driven economy is that we can lose the sense of the place, and how do we ensure we are tackling the human? In any place-based approach, there needs to be an examination of how its strategic plan approaches:

  1. Embedding the quality and sustainability of growth as an essential design principle?
  2. If capital is important in a productivity-based approach, and poor cities need investment to grow – what are the other resources which are important – and how do we value all forms of capital – human, social, financial, and environmental?
  3. How do we broaden and diversify stakeholders – greater devolution, community engagement and design principles, embedded incentives to invest?
  4. How do we strengthen relationships with the national government and jointly create national frameworks for change? How do we encourage deeper devolution and encourage clear rules of engagement and equitable rules-based ways of transferring funding?

Local institutions have been hit hard by austerity, this has undermined the delivery of services and public perceptions of place, making it difficult both on a perception level but also at an operational level for city leadership to lead change and innovation. The public sector does not create growth, it creates the conditions for growth, and underinvestment leads to stagnation and decline in cities. Leadership needs investment to drive confidence, capability, and capacity to be resilient against future trends and to adapt and grow.

This blog was written by Rebecca Riley, Associate Professor for Enterprise, Engagement and Impact, City-REDI / WMREDI, University of Birmingham.

The views expressed in this analysis post are those of the authors and not necessarily those of City-REDI or the University of Birmingham.

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