Devolution is part of the Government's drive for private sector-led growth, so businesses in cities need more of a say.
As the Chancellor reminded us during the CSR last week, a series of devolution deals have been agreed at a rapid rate over the last couple of months. By 2017 we can expect mayors in Greater Manchester, the Liverpool City Region, the North East, the Sheffield City Region and Tees Valley alongside more powers for London’s Mayor. So far these deals have largely been shaped by private negotiations between local and national political leaders. But as attention moves towards how places can best take advantage of the new powers on offer, now is the time for relevant stakeholders – including local businesses – to have their say on devolution.
In our recent report Firm Views, we polled businesses nationally and in three cities (where we also held roundtables with local business representatives) to find what the private sector thought about devolution.
The headline finding? Businesses are supportive of cities having more powers over local decisions – believing that local decisions will be more effective and will benefit their bottom line. This is especially true for infrastructure and planning decisions.
Source: YouGov 2015. Sample size 1,000.
Despite supporting the devolution of powers, businesses overwhelmingly do not feel that their voice has been heard sufficiently to date. However, there are noticeable nuances within the responses. Smaller businesses were most likely to feel under-represented (two thirds rather than less than half of large businesses). In Birmingham, business representatives highlighted that it can feel like the LEP and local Chamber disproportionately represent the views and ambitions of larger manufacturing firms, who benefit from closer existing ties with decision-makers.
Source: YouGov 2015. Sample size 1,000.
Yet there was no consensus on how businesses should be involved as devolution progresses. In Birmingham and Bristol, two in five businesses supported a direct vote on proposals, whereas in Manchester this was less than one in three, and more than half of those asked felt the Chamber of Commerce or LEPs represented them sufficiently. However in Bristol only a third felt approval from the local chamber or LEP would suffice.
Source: Centre for Cities local chamber of commerce surveys. Samples size: 819.
Attempts to boost business engagement in devolution are beginning to emerge across the country – for example in the North East a local business group has emerged to complement the roles that LEP boards and Chambers of Commerce contribute in negotiations with the city. It will be vital to properly consult and involve local businesses during the next stage of devolving powers. The aims of this Government’s ‘devolution revolution’ are clear: growing businesses and a growing economy. Ensuring the private sector plays the right role in shaping propositions and priorities will therefore be vital for devolution to be a success.
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