Andy Street tells CBI conference that driving regional growth means investing in transport infrastructure

The lack of transport within urban areas is holding back most city regions outside London, according to Andy Street, Major of the West Midlands.

Speaking at a panel session on levelling up and economic growth across the UK at the 2022 CBI conference in Birmingham, he said: “Look at the progress in the east end of London with the Docklands Light Railway. Why haven’t we done that between Leeds and Bradford. Why haven’t we done that between Birmingham and the Black Country. Why haven’t we done that between Swansea and Cardiff?

“We have been hopelessly behind other European cities, such as in France, and there is finally an understanding within government that we have to catch up.”

Jeni Mundy, Global SVP Merchant and Acquiring at Visa, also on the panel agreed. She said: “Watford and Hamilton are vibrant towns. What they have in common, among other things, is that they share great public transport infrastructure.”

It has been procrastination by various bodies, regional and national, which has held back investment in infrastructure, according to Robert Evans, Joint Managing Partner at property developers Argent Services.

But he also pointed that other types of infrastructure investment, such as the public realm, are almost equally important. 

“Outdoor spaces act as part of a development allowing people to meet and socialise.

Investment in public realm as well as big infrastructure is essential.”

There was some debate among the panel about where early investment is needed to achieve quick wins in the economy.

For Robert at Argent, it’s focussing on big cities. “They are the low hanging fruit to drive levelling up, and we concentrate on those, then what the government and we all want, will follow.”

But focussing purely on big cities, misses out half the population, according to Jeni.

“Half of us live in town, more than many people would perhaps expect. And 13 per cent of businesses are in towns. Earlier this year we published a report in conjunction with the Social Market Foundation and the British Retail Consortium looking looked at 900 towns.

“What we found that 89 per cent of towns still have room for economic growth. And there are some interesting characteristics. A North-South divide in economic vitality is far too simplistic. A narrow policy focus on levelling up the North raises the risk of Southern towns failing to meet their full potential. Towns also benefit from the economic “halo effect” of successful cities, though there are notable exceptions to this phenomenon.

“But we are just at the beginning of this research what we want to do is to continue to layer in different data sources and stories to build a view on how we can get public policy which is applicable to these different types of towns to help stimulate growth.”

It’s not simply about bricks and mortar, according to panellist Rob Shuter, CEO, Enterprise at BT Group

“I look after smaller and larger businesses across the UK. Any business wanting to grow needs entrepreneurial spirit, access to finance, skills and talent and infrastructure. A large part of what BT is to build infrastructure but we have also done a lot around digital skills.

“We have structured our location strategy around 13 “superhubs” across the UK. We opened the first one in Birmingham this year. 3,500 people and we think we can create 21,000 jobs in the region.’

Andy Street pointed out that to achieve levelling up, the one thing that has got to change is social mobility. “If you start up as a poor kids from the Black Country, you are likely to end up as a poor family from the Black Country. We need to change that.

“The way to achieve that is to have brilliant sectors. But you can’t be brilliant at everything and we have a plan for growth. The West Midlands Plan for Growth builds upon the region’s Strategic Economic Plan and Local Industrial Strategy which capture the key features of the West Midlands economy, including its geographical connectivity, young and diverse population, skills profile and business productivity. You make sure the resources you have, the universities, the human capital, inward investment agencies are all working on those areas.

“Whilst this plan focuses on clusters with the potential for high growth, our wider efforts will also provide support for businesses in other critical sectors, which are vital to the region’s success and prosperity.”

“In our plan for growth we picked eight target areas where we are already performing really well. There is no point trying to be brilliant in something you’re not good at. But it must also have high growth potential. Choose the high growth, high specialised areas.

For instance, the electrification of the automotive industry, where we have the best advantage. We want to make sure that our universities are genuinely leading in R&D in that area. In our case we have that with Birmingham and Warwick Universities. Then we looked at what additional R&D innovation infrastructure we needed, so we funded with the government the UK Battery Innovation Centre in Coventry. Then we thought about how are we going to attract inward investors. So we looked at the companies that are already here, such as Jaguar Land Rover which is going to make the area their centre for electric vehicle manufacturing. Then we have Geely, Polestar, from Lotus, TVS and others. That doesn’t happen by magic. We are nurturing these investments. And then we are looking are nurturing the skills in that area, and we have eight times the national average for skills in the automotive and battery sector.”

“That’s why we can sit in front of investors and say: “this is where your future can be”.”