INDEPENDENT ECONOMIC REVIEW - Q&As

Q: What is the Independent Economic Review of the North East?

The North East LEP, with the support of central government, has decided to commission a critical review of the North East economy, and identify opportunities and barriers to boosting employment and productivity. This Review will enable us to understand the NE LEP economy more clearly, identify where future growth opportunities could come from, and prioritise actions to make these opportunities real. The Review will take a long term perspective – looking to 2030 to ensure long term and sustainable solutions to the challenge of growing our economy.

Q: Why are you doing it?

Whilst there have been a number of studies and strategic analyses of the NE and wider northern economies, none has the footprint of the North East LEP area, nor are they fit for a period of continued uncertainty in financial markets or the unparalleled challenges in public expenditure that are yet to really unfold. Similarly the NE economy is perhaps the most influenced by changes to the political and economic future of Scotland. Current conditions make generalisation from text books impossible to apply to this economy, but they also make it imperative that we prioritise and stick with our strategic objectives and the interventions required to meet them. We won't dismiss any evidence, but the LEP is looking to the review to take the analysis and evidence and turn it into concrete actions. 

The review is also an opportunity to sell our region and its successes so that more people recognise and are attracted by the strengths of the area. For example, we have world-leading experience in advanced manufacturing techniques; our export levels are higher than the national average; in Nissan, the North East has the most productive car plant in Europe; a willing and able workforce; significant natural resources; and alongside a vibrant and leading university and education sector experience and expertise in energy, low carbon vehicles and smart technologies, stem cells and life sciences, design, and healthcare.

Q: Who is doing it?

A large number of people are involved in the process. The review team and its conclusions will be independent of NELEP to ensure a challenging, critical and innovative process. Local and international experts will be involved. The North East Local Enterprise Partnership (NELEP) has asked a team of leaders from finance, industry, public and civil society to produce a strategic and constructively critical view of the North East economy. Although this commission comes from the North East LEP, it has the strong and explicit backing of central government, and will be submitted to the Deputy Prime Minister and cabinet colleagues.

The review team will be led by Lord Andrew Adonis, formerly Secretary of State for Transport and Minister for schools. He will be joined by his Deputy Chair, Heidi Mottram, CEO Northumbrian Water and member of the CBI’s National Infrastructure Panel. Further members of the team include: Lord Don Curry, businessman and Chair of NFU Mutual; Will Hutton, Chair of the Big Innovation Centre and Principal of Hertford College, Oxford; Bridget Rosewell, economist and Chair of Volterra Partners; and the Rt Revd Justin Welby, the Bishop of Durham.

Q: Why are so many people involved in this process based in places other than the North East?

People in the North East will be playing key roles in the review – they will be providing input, coordinating and testing the views of national and international experts in terms of what they mean as practitioners on the ground. We will be providing opportunities for leading researchers, business and professional groups and community organisations to inform the Review alongside the work by external researchers. But we are keen to ensure a challenging approach, and that we can learn from what has and has not worked elsewhere. We are closely engaging with Government the whole way so that we can work to influence national - as well as local - policy and resources.

Q: When will it be happening?

The review is being put in place now, with the aim of reporting to Government in early Spring 2013. This makes it a relatively quick timescale for such a large scale economic review.
The Independent Economic Review team will call upon expert evidence to provide them - and ultimately NELEP and all of its local, regional and national partners - with a set of strategic interventions to be implemented over the next five years.

Q: How are you doing it?

There are many parts of the process. In summary:
Firstly, a literature review will be undertaken to capture existing work and baseline data.
Secondly, there will be two calls for evidence. The Review Team will ask for six cross cutting themes, framed to meet the strategic objectives of NELEP, to be reviewed and assessed by a panel of international experts. These themes are:
The North East in UK, European and global markets 
Labour markets and skills
Infrastructure and land markets
Private and social enterprise
Capital markets
Public policy

Simultaneously, sectoral, professional and community groups will be asked to prepare their own submissions to the Review Team. The team will spend time in the North East considering all positions, and a conference in late Autumn will provide an opportunity for the evidence to be presented and debated. The Tyne and Wear city region economic review will also form part of the evidence base.

The entire evidence base will be synthesised and considered by the Review Team, who will report their recommendations in Spring 2013. The team is asked to provide actions for the North East LEP itself, recommend actions that would need to be taken forward with partners in the region and across the North of England and Scotland, and actions that require central government intervention to resolve. More specifically, the succinct report will include:

Five policy recommendations for the North East LEP;
Five policy recommendations for LEP's partners (who might include neighbouring areas or those with similar industrial and economic characteristics); and
Five policy recommendations that will need Central Government intervention to realise the NE's potential.

Q: How much is it costing?

The review will be undertaken using only existing resources. No additional funding is requested from any one and we will make the best possible use of funds and offers of support and input that have already been secured. Many of those involved will be doing the work on a pro bono basis. A small resource is being used for evidence base development to ensure decisions are taken on the basis of full and contemporary information, and this figure is currently being finalised.

Q: Aren’t there already a lot of strategies in existence? What’s new about this one?

This review is not a strategy, but will identify a number of policy recommendations and inform the key priorities of the North East LEP. It will also contribute to the development of a programme for European Structural funding post 2014 (current European funding runs out in 2013, so it’s critical we have a strong rationale for future funding, and how it fits with other organisations’ priorities).
A number of strategies have been developed in the North East in the past. These were all produced on the basis of a very different economic and institutional landscape. In addition, geographical boundaries have changed, and so we need to improve our understanding of what this means

Q: Is this going to be yet another expensive, huge consultation exercise?

Key sectors and partners will be engaged with, but this will not be a large scale, costly exercise. Partners will be invited to submit evidence of their respective economic contributions. These will then be collated by key partners – our universities will have an important role in this. This information will be considered by the Review Team alongside evidence from international experts. However, it will not be a formal consultation process.

Q: What is the North East LEP area?

The North East LEP area encompasses the local authority areas of Northumberland; North Tyneside; Newcastle; Gateshead; South Tyneside; Sunderland; and Durham.

Q: What about Tees Valley – are they not involved?

Tees Valley has its own very committed and successful LEP – Tees Valley Unlimited. They are aware and supportive of our review process, and our economic links with the area and other bordering areas (Scotland and Cumbria) will be considered through the review process. Tees Valley is putting in place its own processes of economic prioritisation, and will continue to play an important economic role in the UK.

Q: How is it going to make a difference? Will it have any effect on the ground?

While the Economic Review process will be ‘high level’, the results should be felt by people in the NE due to policy changes arising from the review. Changes in approaches should be felt locally, whether it relates to infrastructure, skills development or other policy areas. If a particular area of national policy is felt to be a barrier to growth in the North East, there may well be a case for influencing and changing Government policy. 

Q: Who will benefit from the Review?

The people and businesses of the North East will ultimately benefit from the Review. This will not be during the review itself, but the outcome of the review will result in some key areas being taken forward in a different way. The goal of the review is to promote economic growth within the North East, with more people able to contribute to and benefit from this growth.

Q: Will this help us get out of recession?

The North East has a key role to play in terms of contribution to the UK economy. We want this review to enable us to maximise our potential in terms of economic growth. While this area alone cannot change global and national economic trends and challenges, the review will aim to ensure that the North East will become more self sustaining and less of a “burden” (in terms of benefit payments, grant payments etc) on the national economy. Indeed, within the next five to ten years, we would hope that the North East is able to grow its output to become a significant contributor to the UK economy. Our balance of trade surplus already shows that we have the potential to do this.

Q: Is this just happening in the North East?

A similar review has recently taken place in Merseyside (the Heseltine/Leahy review), which has influenced local and national policy. Before that the Manchester Independent Economic Review set a benchmark amongst recent economic analysis of regional economies. The North East Independent Economic Review has the benefit of the explicit support of Lord Heseltine and also access to the team that under Manchester's review. We are well placed to learn from both reviews and apply this to the NE LEP area.