Low cost ways to pursue economic growth

The Economic Growth Advisor assignment in Three Rivers highlighted how, in low cost ways, the council could add more value in pursuit of economic growth. This case study forms part of our economic growth resource.

Efficiency and income generation

The Economic Growth Advisor assignment in Three Rivers has proved its worth in providing a ‘critical friend’ perspective on the work of the council, highlighting how, in low cost ways, the council can add more value in pursuit of economic growth, one of its top corporate objectives. Economic growth opportunities are tightly constrained by the location of Three Rivers district within the London Green Belt and pressures for reallocation of commercial sites for housing.

The main gains and associated outputs for the council in taking part in the LGA’s Economic Growth Advisor programme have been:

  • a fresh look at the local evidence base around economic growth, contributing to an updated Economic Profile
  • a ‘critical friend’ report to the Management Board recommending steps to sharpen the council’s approach to economic development
  • a report providing good practice advice on introducing a Business Charter
  • an outline for a revised Economic Development Strategy.

Longer term impact will depend on response to consultations on the Economic Development Strategy and on implementation of assignment recommendations. Potential benefits sought include reduced barriers to the expansion of local business, improved job opportunities for disadvantaged residents and increased Business Rate income for the council.

Innovative thinking has featured in considering the corporate role of the council in supporting economic growth, not least in the process of introducing a Business Charter as a means of effecting changes in how the council works with local business.

The main lessons have related to:

  • understanding where the council can best add value and ways of developing a more ‘intelligent’ approach to economic development
  • seeing council services and our website more consistently through the lens of local businesses
  • using previously untapped sources of data to build a richer economic profile and basis for action.

Rationale for project

Three Rivers district is situated in south west Hertfordshire, bordering London and Buckinghamshire and straddling the M25. There is a resident population of 87,000 people living in small towns and villages, the largest town being Rickmansworth. Nearly 80 per cent of the area is designated within the Metropolitan Green Belt.

Financial and business services and associated IT make up the largest employment sector in Three Rivers and the district is also a major centre for the film industry, given the presence of Warner Brothers. Other major employers include Camelot, VocaLink, Imagination Technologies, Skanska and RES, and there are many, diverse small businesses.

Whilst the Three Rivers area generally has an affluent and well-educated population and unemployment levels are generally low (1.3% on Jobseeker’s Allowance in May 2014), there are concerns about youth unemployment and pockets of deprivation where there are relatively high levels of unemployment and reliance on benefits (one in five of the working age population).

The council acknowledges that the area is not immune from changes in the global economy and economic restructuring. The demise of Comet Plc was a case in point, with the closure of their HQ in Rickmansworth and the loss of over a hundred jobs.

Supporting the local economy has not traditionally been a high priority for the council. However, all parties on the council (Liberal Democrat majority plus Conservatives and Labour) recognise that not only will this help generate jobs and wealth in the area, but also it can bring environmental benefits by reducing levels of out-commuting to other areas.

We are an ambitious authority but recognise that we have very limited resources both in terms of finance and staff. We sought the support of an Economic Growth Advisor to act as a ‘critical friend’ to prompt debate and steer action in developing the council’s Economic Development Strategy and how the council as a whole approaches the topic and its relationships with business. We are concerned to ensure that our resources are geared to where they can have most impact, and that our influence is strengthened, not least in the context of the Hertfordshire LEP plans and decision-making.

Key actions and outputs

The Economic Growth Advisor assignment, in March to May 2014, involved interviews with key individuals within the council, neighbouring authorities and partner organisations, presentations to the Council Management Board, and desk research covering policies, data, evidence and practice elsewhere. There was Management Board support throughout, with the project a standing item on the fortnightly agenda.

The exercise has been timely following the production of the LEP Strategic Economic Plan and European Investment Strategy and looking to the future after the May 2014 council elections.

The main outputs from the assignment were:

  • a report to the Council Management Board, on the council’s approach to economic development
  • a report on introducing a Business Charter
  • an outline for a revised Economic Development Strategy
  • an updated Economic Profile.

The review looked at the existing Economic Development strategy, produced as an interim exercise in January 2013, and at current initiatives around apprenticeships and skills, business information and engagement, regeneration and tourism. Key Findings Report to the Council Management Board The Advisor reviewed the priority accorded to economic development, the council’s approach as a whole, its relationships with business, and the scope for low cost actions to create greater impact, leading to a report to the Council Management Board, presented in early May. The report also considered the implications for Three Rivers of Hertfordshire LEP plans and outlined possible themes for the Economic Development Strategy to be developed further.

The main findings and recommendations related to:

1. Giving greater attention to how economic development as a strategic aim and priority can be implemented in practice, looking at dedicated resourcing, local economic intelligence and business engagement. A starting point is to use economic growth as a theme in service planning and a criterion in fundamental service reviews being carried out by the council in 2014/15.
2. The scope for low cost actions to make a difference, given limited room for manoeuvre (reflecting the Green Belt, the size and openness of the Three Rivers economy, and council resources). For example:

  • ensuring that local businesses can take full advantage of county-wide and national programmes such as Apprenticeships and the LEP Business Growth Hub
  • working with partners to exploit local economic assets, including Warner Brothers, heritage and green infrastructure
  • coordinating action to ensure that residents in deprived communities do not get left behind.

3. The need to debate the council’s level of ambition for growth, given that space for business expansion is a critical issue and key to both economic development and increasing council income through Business Rates. This has implications for future reviews of the Local Plan and associated documents and the council’s own investment strategies.
4. The potential of a more coherent approach to working in partnership with local business organisations, the LEP and neighbouring authorities, in particular on business networking, inward investment, and improving skills and access to jobs. This matters most with Watford, given adjoining business parks and new opportunities opening up through the LEP top’s priority, the Croxley Rail Link which will extend the Underground to Watford Junction.
5. The imperative for the council to become more business-friendly across its operations: getting the basics right for business customers, devoting time and energy to business engagement, and developing a Business Charter.

(NB. The taking forward of these findings/recommendations are still subject to Member endorsement).

Business Charter
The Advisor drew out learning from recent experience in other districts (such as Lewes, Broxbourne and Dacorum) in exploring how Three Rivers might introduce such a Business Charter. The purpose is to foster better relationships with local businesses and promote what the council does with and for business.

The Charter will not be an end in itself but rather part of a continuous process. Its value will be greater as part of a wider approach to employer engagement, sitting alongside activities such as a rolling programme of contact with key employers, active participation in local business networks, campaigns (on, for example, Apprenticeships, Green Deal for Business), and use of the council website to inform and enable involvement. It accords with the LGA’s policy, ‘Open for Business’ and will sit alongside the county-wide ‘Better Business for All’ partnership which promotes improved practices and the business benefits of good regulation.

The council recognises that successful implementation will require:

  • senior officer and political commitment
  • active promotion, with a strong story about how the Charter can make a difference
  • named ‘Business Champions’ across council services, with a Champions Group to drive progress and share good practice
  • project management and staff training
  • advance consideration of any critical implications of Charter commitments
  • realisation of benefits for individual council services – and for local businesses.

The council acknowledges that there is a change management process to be facilitated, recognising existing strengths (for example in pre- application discussions with major businesses ahead of planning applications), ensuring that more attention is given to businesses as customers of public services and as potential partners, and drawing out the benefits for individual services.

Prospective gains through the Charter process include:

  • fresh intelligence about local business, shared within the council
  • ‘cross-selling’ of council services and those of partners
  • collaboration with local businesses to generate income, reduce costs and/ or free resources
  • a business customer perspective in improving or transforming services, including shifting the balance of service access channels
  • greater efficiency where the Charter encourages early discussions over business and community issues before they become intractable problems.

We have found the independent analysis provided by the Economic Growth Advisor to be refreshing, working against any tendency on our part to be inward looking. Whilst many of his recommendations are common sense and can be applied generically, he has highlighted things we are doing well, and what we need to work on. His contribution has focused debate at our Management Board on what we are trying to achieve, and how, and set up the ground for further discussion with councillors. Information on the plans and activities of other councils has been particularly useful.

Lessons learnt through the Growth Advisor assignment have included:

  • developing a corporate overview of the ways in which the district council does, and can do more to, add value to economic growth
  • identifying previously untapped sources of data (eg, on employer skills issues, Apprenticeship and skills provision, working age benefit take-up, Work Programme delivery)
  • thinking through with businesses what they need from the council website and social media communications – which can usefully draw on the Government Service Design Manual
  • strengthening understanding of the connections between local needs/ priorities and opportunities opening up through LEP plans
  • reassessing the case for several proposals current at the outset of the assignment, for example, an apprenticeship grants scheme and local tracking system
  • clarifying scope and necessity for collaboration with neighbouring authorities, especially on inward investment, joint programme development and bidding, and making better use of our combined resources.

Economic Benefits

Economic Development Strategy
The economic benefits of the Growth Advisor assignment will ultimately depend on successful implementation of the Economic Development Strategy. Discussions with council staff and partners, and analysis in updating the Economic Profile will lead to a reshaping of the council’s strategy around the themes of: 1) Nurturing enterprise; (2) Retaining and attracting investment; (3) Championing skills and access to jobs; and (4) Renewing and regenerating our places. These are broadly in line with those of neighbouring districts, seen as important in providing the basis for collaboration and presenting joint cases to Hertfordshire LEP and other funders.

Further to member discussions, the council proposes to consult on the revised Strategy, seeking feedback in particular on:

  • the content of the Business Charter
  • local promotion of Apprenticeships and work experience
  • opportunities to create space for growing businesses
  • an agenda for engagement around current and emerging business issues and scope for collaboration.

Intended outcomes include:

  • reduced barriers to the expansion of local business, including through identification of sites for future development
  • improved job opportunities for disadvantaged residents, especially those in poorer neighbourhoods and those with limiting health conditions
  • increased Business Rate income for the council, provided that more land can be allocated and developed.

Behind the council’s approach now lies the assumption that we need to become more proactive and devote time and energy to building relationships with local businesses, in order to deliver on our objectives and not miss the opportunities to harness the ideas and resources of local employers. There are so many possibilities to benefit, for example, in their:

  • support for visitor attractions such as the water-based Rickmansworth Festival
  • attracting sponsorship and advertising revenue linked to council activities
  • willingness to mentor new businesses and help develop employability amongst young people
  • experience which can be shared in helping us become a more entrepreneurial council.