All eyes on the Spending Review as PM launches green industrial revolution – Mark Duddridge
Next week Chancellor Rishi Sunak will announce his spending plans for 2021-22 and his decisions are likely to have far-reaching consequences for the economy of Cornwall and the Isles of Scilly.
He was due to set out a three or four-year Spending Review but Covid-19 has put paid to that and instead he will focus on tackling coronavirus and how he intends to protect jobs.
This is sensible given the circumstances, but also frustrating when it comes to longer-term planning and it remains to be seen if there will be any new funding for the regions and over what timeframe.
For Cornwall and the Isles of Scilly this is vital because we don’t just want to go back to how things were pre-COVID, we want to realise the opportunities of a changing global economy. Of course, we need to protect businesses and jobs, but going ‘back to normal’ means back to being one of the poorest regions of the UK. We have a much bigger opportunity than that.
Shared Prosperity Fund
Of growing concern is the lack of progress on the Government’s Shared Prosperity Fund (SPF), which is meant to replace Cornwall’s €600 million EU-funded Growth Programme after Brexit.
Delays to the SPF and a focus on Covid-19 recovery presents a significant risk that EU funding will not be replaced via a dedicated fund aimed at economic development in the areas of the UK most in need of levelling-up, including Cornwall and Scilly.
While recovery from Covid-19 must be the key priority for the whole economy, including ours, it should not detract from the long term need for levelling-up of areas through a SPF that leaves us no worse off after Brexit, which is what we were promised.
Nor should it be a competitive bidding pot. This would only exacerbate the difference between regions and undermine the levelling up agenda even if, as suggested, the Chancellor does finally review the Treasury’s investment rules known as the ‘Green Book’, which traditionally favour more prosperous areas for investment.
EU funding programmes have achieved a lot in Cornwall and Scilly but businesses are clear that there needs to less bureaucracy and more flexibility with what comes next. This is vital in unlocking the potential of our businesses.
Our approach to Government officials, Ministers and MPs continues to seek a fully devolved SPF, based on need, in the form of a single pot investment of £700 million into our local economy over the coming 10 years, and devolved decision-making for adult skills. It’s unfortunate therefore that the White Paper on Devolution and Local Recovery has been postponed to next year.
But we remain undeterred and are getting on with the investment that is available to support our recovery. Having secured £14.3m from the Government’s Getting Building Fund in August we are now contracting individual projects across Cornwall that will make a real difference to our economy for years to come.
We are funding a new STEM skills centre in Bodmin that will work with industry to deliver new skills to 16-18 year-olds and adult learners, including engineering, space, energy, mining, creative and marine.
We are investing in the transformation of the Hall for Cornwall into a creative industries powerhouse that will also be a magnet to boost post-pandemic High Street footfall in Truro, and the city’s night time economy.
We’re supporting the multi-million pound expansion of the creamery at Davidstow to boost exports and provide security for hundreds of dairy farmers, while reducing the environmental footprint of the dairy.
Green industrial revolution
And we are backing a pilot lithium recovery plant aimed at making Cornwall a battery materials hub for the UK. This is all the more relevant given the Prime Minister’s announcement this week to end the sale of new petrol and diesel cars and vans by 2030, which is 10 years earlier than planned. And he has committed to spend nearly £500m over the next four years on the development of mass-scale production of electric vehicle batteries, which could be good news for Cornwall’s lithium extraction ambitions.
There will also be money for new charging infrastructure and zero-emission public transport, and we will be working hard to secure our share of that investment which will be critical to keep a rural area like ours moving.
Floating offshore wind
Together with partners we are progressing plans to develop an offshore floating wind industry in the Celtic Sea off our South West coast, potentially creating thousands of jobs. Offshore wind is a cornerstone of the Prime Minister’s ‘green industrial revolution’ and he has already set a target to deliver 1GW of floating wind by 2030. Two weeks ago we briefed Business and Industry Minister Nadhim Zahawi about our ambitions and have provided at his request more detail about how floating wind can become a reality in our region.
The LEP is also supporting the £64m South West Floating Offshore Wind Accelerator Project, led by our Board member and Wave Hub executive chair Steve Jermy. Next week a bid is being submitted for £30m-plus of Government funding to fast-track the construction of floating windfarms in the Celtic Sea from the mid 2020’s onwards, and support investment in local companies and the supply chain in order to maximise the ‘local content’ of floating wind projects in the future.
Securing our economic future
These are just a few examples of how the LEP is working to secure the economic future of Cornwall and Scilly as we work towards Cornwall’s target of being carbon neutral by 2030. Our area can play a national role in the green economic recovery, supporting jobs and businesses, and we will continue to make the case for more devolved investment to help us level up with the most prosperous parts of the UK.
Mark Duddridge is chair of the Cornwall and Isles of Scilly Local Enterprise Partnership.