Independent review calls for central government to devolve power

The Review shows that if the UK is to emerge from the current recession as a stronger and less polarised economy then it will be policies that are developed and implemented at a local, rather than national, level that will be vital.

The Review concludes that:
> Manchester's skills base, talent pool, connectivity and deep political cooperation make Manchester the UK's best bet to realise long-term growth outside of London
> In light of the ongoing regional skills gap, national and regional economic, social, transport, planning and housing policies need to be urgently re-examined

The Review is the responsibility of an independent panel of economic experts, including Jim O'Neill, Head of Global Economics, Commodities and Strategy Research, Goldman Sachs, who commented:

'The findings of the MIER pose a number of tough questions for government about how best to increase skills and raise productivity. It also shows that there are several policy areas where local and regional intervention would be a better platform from which to invest the UK's limited and overstretched public sector finances.

'Of all UK cities, in particular Manchester's governance structure is ready to adapt and take on the challenges of increased power from central government.'

The reviewers' key recommendations are:
> Neighbourhood level intervention is needed to improve education to bridge the skills divide;
> A housing policy is required that emphasises actual demands with an easing of planning restrictions;
> There must be a halt in government driven sector-led and clustering investment policies
> Innovation, trade and business links should be driven by the private sector
> A review of transport planning within the city region to improve connectivity, increase productivity and access to jobs and public services

The Review draws on six independent, wide-ranging and comprehensive reports. It concludes that due to the Manchester City Region's (MCR) size, skills base, talent pool, connectivity and political and business structures, is best placed within the UK to compliment London and the South East to help the UK realise long term economic growth.

Key findings of the Review include:
> The biggest barrier to increasing productivity is the remaining skills gap in the MCR. A short-term solution is to attract skilled workers by lowering the costs associated with living in the MCR, whilst long-term policy needs to improve early learning experiences in deprived neighbourhoods.
vHousing strategy needs to take account of demand and address planning restrictions, whilst a national and regional policy of promoting mixed-housing is failing as demand for such housing doesn't exist in MCR.
> Intra-city transport investment, rather than investment in national connections, is needed as poorly connected neighbourhoods and congested roads lower the attractiveness of the city to mobile skilled labour and restrict travel between neighbourhoods.
> National government's planning policy focuses on brownfield sites, which high value business does not want, and on business incubators which are all too often in the locations the businesses do not find desirable.
> Sector based clustering policy fails to increase productivity, investment and innovation as these gains are related to supply chains which cross sector (and geographical) boundaries.
> Firms in Manchester have limited trading links with other firms in the city region, this means innovation isn't been captured or spreading as much as it could. Where effective and lasting innovation does take place, it is along the supply chain (exchanging), not within a sector (mimicking).

The MIER is intended to provide a framework for the economic development for the Manchester city region for the next decade. This is the first time a city region has undertaken such a process to examine what governance structure and policy focus is required to deliver future growth.

The MIER is made up of an economic baseline, a comprehensive literature review and six reports:

Innovation, connectivity and trade (published today);
The Manchester City Region: the case for agglomeration economies (published today);
Inward and indigenous investment;
Understanding labour markets, skills and talent;
The Daresbury Science and Innovation Campus; and
Sustainable communities.

The Review is being managed by the Commission for Economic Development, Employment & Skills in Manchester

The Review is the responsibility of an independent panel which contains;

Sir Tom McKillop
Jim O'Neill, Head of Global Economics, Commodities and Strategy Research, Goldman Sachs
Professor Edward Glaeser, Fred and Eleanor Glimp Professor of Economics, Harvard University,
Diane Coyle, Managing Director, Enlightenment Economics; and
Jonathan Kestenbaum, Chief Executive, NESTA

The Review is funded by the Manchester Innovation Investment Fund, which is supported by both the Northwest Regional Development Agency and the National Endowment for Science Technology and Arts, and separately by the Northwest Regional Development Agency, by the Learning and Skills Council and by the Northwest Improvement Network.

The Review is also funded, supported and underwritten by the Association of Greater Manchester Authorities (Bolton MBC, Bury MBC, Manchester CC, Oldham MBC, Rochdale MBC, Salford MBC, Stockport MBC, Tameside MBC, Trafford MBC, Wigan MBC).

Related links to this article:
Manchester Independent Economic Review