Chancellor’s letter to Lord Adonis signals welcome support for ‘Fast Growth Cities’

'Fast Growth Cities' don't necessarily need a mayor-led devolution deal, but they do need flexibility on planning and skills.

The Chancellor has been busy this week. As well as putting the final touches to his Budget speech he also wrote to Lord Adonis, the Chair of the National Infrastructure Commission, to thank him for his work on energy innovation, London transport and Northern connectivity, and to set out the next two priorities for the NIC. One is around 5G and the other is on maximising the economic potential of Oxford, Milton Keynes and Cambridge. The Chancellor’s letter and the terms of reference for this project are available here.

This focus on what the Chancellor refers to as some of the UK’s “fastest growing and most productive places” is very welcome and picks up on the analysis we published earlier this month on the ‘Fast Growth Cities’ Group, which comprises Oxford, Milton Keynes, Cambridge, Swindon and Norwich.

The paper highlights the strong performance of these cities on a range of economic indicators, including wages, productivity, entrepreneurialism, and share of knowledge-based jobs.

Fast Growth Cities Info Map

It also highlights a number of significant economic challenges which threaten to undermine their continuing economic success in the years to come, including:

  • Unaffordable housing – a lack of new homes plus strong population growth is leading to higher house prices and low affordability. Oxford and Cambridge, for example, are the first and third least affordable cities in the UK respectively, which is proving a major barrier to recruiting and retaining workers.
  • Increasing transport congestion – the Fast Growth Cities all attract large numbers of workers from surrounding areas. This strong pull coupled with poor public transport is resulting in significant traffic congestion problems.
  • Skills and education gaps – all the Fast Growth Cities are affected by skill shortages to some degree. Swindon, Milton Keynes and Norwich, for example, all have a lower than average proportion of residents with level 4 qualifications (equivalent to a degree) or higher, and only Cambridge has 5 A*-C GCSE incl. Maths & English attainment levels above the national average.

It’s good to see that exploring these infrastructure and related skills issues will be central to the National Infrastructure Commission’s work over the next 18 months.

It’s important to note that for these cities to continue to grow, they won’t necessarily need an all-encompassing mayoral-led devolution deal. However, they will need targeted financial and political support from the Government, greater influence over national agencies such as Network Rail, Highways England and the Homes and Communities Agency, and more flexibility to bend national policies around housing, planning and skills in order to respond to the specific growth obstacles and opportunities they face.

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Timothy Dixon
18 March 2016 16:04

....not forgetting Reading, of course!

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