Introduction David Ralph, HotSW LEP CEO
There is no doubt that these are challenging times – for our businesses, for our communities and for Local Enterprise Partnerships.
The publication of the Levelling Up White Paper signalled the completion of the LEP Review by Government and the evolution of broadening devolution deals between Government and local areas.
This included ‘folding in’ LEP functions to new democratic-led Combined Authorities by 2030 for those areas that want a devolution deal. Devon, Plymouth and Torbay are in the initial wave of new devo deals and my thoughts on this can be found in my blog published earlier this month.
More importantly we have highlighted in our last Business Bulletin the opposing headwinds and tailwinds in the economy and which might win out. Certainly we’re seeing strong order books in many areas, but tight supply chains, increasing costs and labour shortages are causing huge challenges to fulfilling these. Moreover, the cost of living increases through energy prices and inflation will inevitably stall consumer demand, weakening outlook to our economy, and added to all this is increased instability from the tragic events in Ukraine.
Our response to the Chancellor’s spring statement highlighted that we think the Exchequer will need to go further, particularly to minimise the impact of the likely increases in the energy cap later in the year; changes to MOTs or nursery staffing levels will not cut the mustard! We do welcome the Government’s recognition in its revised energy plans to accelerate delivery of floating offshore wind, and increasing recognition that the South West has serious skin in the game in providing future energy security that is both low carbon and good value. We will shortly be publishing a study showing the enormous potential of floating offshore wind for the South West economy – watch out for that in May.
The Skills and Post-16 Education Bill is almost to Royal Assent, which will set out a renewed focus on Further Education delivery – which across HotSW is of an outstanding quality – and a commitment to support business through Local Skills Improvement Plans which are likely to be developed across our area.
Government has announced the amounts of UK Shared Prosperity Funding (and Multiply Funding) to go to individual areas over the next three years. UKSPF replaces the EU Funding that was distributed across the UK (and will continue to do so for another few months), which funded social inclusion, low carbon, skills and business competitiveness projects. Whilst clunky and bureaucratic, these funds were an important ingredient in delivering support to local businesses and projects, and funded projects such as the Market Hall development in Plymouth, the HotSW business support programme, the Digital Innovation Centre in Somerset, and the EPIC centre in Torbay.
The funding available through UKSPF and the related Multiply Funding is significantly lower than previously available through the EU; a total of £29.8 million will be available over the next three years for the HotSW area. This compares with £110 million from the last round of EU funding, albeit over six years from 2014-20, so around a 50% reduction in like-for-like terms. In addition to EU monies, over the 2014-20 period the LEP secured £255.7 million from Government funds. UKSPF and Multiply run over three years with funding back-weighted to 2024-25 and the programme is being administered through Local Authorities. With significantly less investment available to the area than previously, it is important that this funding continues to take on the long-standing structural challenges of the area, including social inclusion, business support and net zero projects. However, I think it is likely to be increasingly focused on places rather than business challenges which, along with fragmentation and so increased cost of delivery, is a real concern.
I hope you find this month’s newsletter interesting and informative.
David Ralph
Chief Executive
Inclusive growth in the South West
We track a range of economic indicators and recently published four dashboards identifying key messages and data. Our Inclusive Growth dashboard sets out key issues in inequality and inclusivity faced by the region, and changes in the last few years.
As with most other areas, the Heart of the South West still has significant inequalities in life outcomes across its population. Until differences in key outcomes, such as educational attainment, can be narrowed, these will continue to act as barriers to the aspiration of more inclusive growth. The Inclusive Growth dashboard provides an analysis of the area’s inclusive growth performance.
Region faces country's worst social mobility and educational barriers
A new report by the University of Exeter offers a major contribution to national efforts to improve the skills and education of young people across the country, and highlights the urgent need for levelling up in the South West.
The report reveals that the South West has the worst educational outcomes for disadvantaged young people in the country, alongside low social mobility compared with other areas. With fewer professional jobs available and a low return to education, the South West is seeing the highest number of young people leaving the area than any other region. Read the report for a full breakdown of the challenges presenting the area, and how we can tackle them.
What role can the South West play in the new Energy Security Strategy?
The Government recently announced their Energy Security Strategy, aiming to boost the UK’s energy independence while tackling rising costs. As energy prices rise around the world following the invasion of Ukraine, the Government wants to move away from reliance on external energy sources.
The strategy proposes the development of eight more nuclear reactors to reduce the country’s dependence on oil and gas. As well as a focus on nuclear, the Government is seeking to reform planning laws to speed up approvals for offshore wind farms, in the hope of producing up to 50 gigawatts of energy – enough to power every home in the country. Read our article to find out more about the strategy, and what role the South West has to play.
EDF report highlights wide benefits of net zero transition
EDF Energy have released their annual socio-economic report. This year’s findings delve into how the transition to net zero can deliver huge social and economic benefits, changing lives and communities for the better.
The opportunities provided by Hinkley Point C are playing an important role in overcoming challenges faced by the local area; much of Bridgwater and nearby seaside towns are geographically isolated and challenged by seasonal work. In 2016, West Somerset was ranked at the very bottom of the UK’s social mobility index, whilst Sedgemoor contains areas which are among the most deprived 10% in the country. It’s vital that the journey to net zero is beneficial not just to our environment, but to the lives of people who need support most.
Free business finance event for foreign-owned SMEs
The Heart of the South West Growth Hub is our main way of engaging with local businesses who are looking to develop and grow. The hub provides independent diagnosis and referrals to business support schemes and sources of further support.
Funded by the Department for Business, Energy and Industrial Strategy, the Growth Hub advisers are armed with information about local and national business support schemes, services and events. Find out more about what the Growth Hub offers, and how they can help your business grow.
Investment opportunity for foreign-owned businesses
Accessing financial and business support is crucial for business growth. We are holding a business support event in Paignton on 10th May at the Electronics & Photonics Innovation Centre (EPIC) in Paignton to help foreign-owned businesses access financial support.
The Access to Finance seminar will offer guidance on Government funds and grants available to foreign-owned businesses, and business support available from the Heart of the South West Growth Hub, HSBC, and British Business Bank, with expert advice from SME lending specialists.
Free training for Somerset businesses
The University of Exeter is partnering with Somerset Council on a government-funded project to better understand the data analytics/ science needs of businesses in Somerset, and deliver specialist training to organisations.
They are running two free virtual training events on Monday 9th May, open to Somerset businesses who could benefit from further data analytics expertise.
Businesses who take part will also have the opportunity to apply for a free specialist 1-2-1 knowledge transfer and innovation session provided by the University of the West of England.
Hinkley Point C opens new training centres
A new welding Centre of Excellence has opened at Hinkley Point C, alongside two other new training centres. The centres will be ready to help local people join the 4,000 workers needed for the next phase of the power station’s construction.
The project has invested £8 million into the three new facilities, in partnership with the college. The Welding Centre will train and qualify 500 welders a year, benefiting local people and meeting skills shortages in the South-West and across Britain.
Improving health and wellbeing in Torbay
Torbay Council want to hear from local residents regarding their health and wellbeing challenges, to support their work in tackling health challenges as part of their Health & Wellbeing Strategy.
The strategy sets out the biggest health challenges in Torbay according to local statutory, voluntary, and community partners, including those areas the Board feels are the biggest health challenges in Torbay. Find out what the five priority areas identified are and how you can have your say on the matter.
What does the future hold for LEPs?
In this month’s blog David Ralph, our CEO, explores what the future holds for LEPs since the recent Westminster Hall debate about the role of LEPs. Neil O’Brien, Minister for Levelling Up, recognised “LEPs will continue to have a crucial role” – but what does this mean in reality?
