Transcript here - East Midlands Councils

…help yourself to some lunch!
EMC Technical Assistance
Project
Andrew Pritchard
Director of Policy &
Infrastructure
Introduction
What is it all about?
 Some background
 Your mission today…

What is it all about?
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
A technical assistance project led
by East Midlands Councils to
provide an evidence base for
future EU funding
To make sure that we maximise
the potential of EU investment
across the East Midlands
Strong support from DCLG &
Council Leaders for the project
Localisation of EU funding

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Establishment of a national ‘EU Growth
Programme’
LEPs to develop EU investment strategies
Each LEP to be given a ‘notional allocation’ of
EU funding to prioritise
Option to ‘buy-in’ to national programmes
Payments to be made centrally
Notional allocations will be reviewed against
performance from 2017 onwards
“Show me the money”
EU Growth Programme = €6.2 billion
 UK Local Growth Fund = £2 billion

In and around the EM
D2N2:
GLLEP:
LLEP:
NEP:
SEMLEP:
GC&GP:
€249.7
€133.5
€126.3
€55.0
€88.3
€75.5
UK Local Growth Fund
New Homes Bonus
LA Major Transport Scheme
Local Sustainable Transport Fund
Integrated Transport Block
Further Education Capital Fund
ESF Skills Match Funding
£400m
£819m
£100m
£200m
£330m
£170M
Emerging UK Priorities
•Innovation
•SME Competitiveness
•ICT
60% + of ERDF
•Climate Change
•Environment
•Sustainable Transport
No Minimum spend
•Employment
•Skills
•Social Inclusion
80% + of ESF
•Low Carbon Economy
20% + of ERDF
Also…
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Minimum 20% of combined
ESF/ERDF on ‘social
inclusion’
Gender equality, equal
opportunities & nondiscrimination
Sustainable development
Programme Timescales
7
October 2013: Draft
LEP EU Investment
Strategies
 January 2014: finalise
strategies
 March 2014: new EU
Programme starts
 2017 – first review of
notional allocations
Current Experience



Spend under the current
ERDF Programme has been
slow
Too many small projects difficult to see a strategic
impact
Original operational
programme did not fully
meet local needs - e.g.
Broadband
Future Challenges


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1 region replaced by 7
LEPs – 4 overlapping
Pressure for early spend
on projects that will deliver
clear outcomes
LEP notional allocations to
be reviewed in 2017under-performance could
be penalised
Threats v Opportunities
What are we going to do?
Facilitate a series of consultation events
 Develop an evidence base (or ‘socioeconomic framework’) to inform both the
UK Growth Programme and individual LEP
Strategies – working with NTU.
 Highlight potential areas of collaborative
activity that can maximise strategic impact
and reduce ‘transaction costs’

Events Diary
1st July: Greater Lincolnshire LEP
 5th July: Leicester & Leicestershire LEP
 9th July: Competitiveness Round Table
 16th July: NEP/SEMLEP
 22nd July: D2N2
 25th July: Green Economy Round Table

Project Timescales
 End
of July 2013: Interim
Report
 September 2013: draft
Framework
 December 2013 – final
Framework
 January - June 2014
Awareness raising
Key Outcomes
green
“It’s the economy, stupid”
More Jobs
 Less Worklessness

Your mission today…
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To think about how best
EU funding could be used
to develop the green
economy.
To highlight areas or
issues where wider
collaboration might be
helpful.
To ask if you do not
understand.
East Midlands PA3 Project
Socio-Economic Evidence –
Low Carbon Thematic Objective
East Midlands Regional Roundtable
25th July, 2013
Chris Lawton
Nottingham Business School
Project Rationale and Objectives
• The project aims to provide socio-economic evidence to
help identify synergies, linkages and common challenges
across LEPs within or overlapping the East Midlands
• Emphasis on the 5/6 Thematic Objectives (out of 11)
prioritised by UK Government: Innovation, Enterprise,
Low Carbon, Skills, Employment/tackling worklessness
• To identify opportunities for collaboration between LEPs
• The UK Government would:
“like to see Local Enterprise Partnerships working with each other
to deliver a bigger impact… and achieve economies of scale
wherever possible”
Source: HM Government, April 2013. ‘Technical Annex: Preliminary guidance to Local Enterprise Partnerships
on development of Structural & Investment Fund Strategies.’ paragraph 2.8, p. 4.
Local Enterprise Partnerships within or overlapping the East Midlands Region
Contains Ordnance Survey data © Crown copyright and database right, 2013.
Economic Context
Chart 1: UK GDP Growth (NIESR modelled monthly estimates), 2008-present
compared to previous recessions
GDP % change
0.1
1930-1934
0.08
1973-1976
0.06
1979-1983
0.04
1990-1993
0.02
2008 to present
0
-0.02
Months from start
-0.04
-0.06
-0.08
-0.1
Source: NATIONAL INSTITUTE of ECONOMIC and SOCIAL RESEARCH, November 2012. ‘Monthly GDP Estimates’, www.niesr.ac.uk
Economic Context
Chart 2:Employment rate (% working age residents), 2012
80
78
76
74
72
70
68
66
64
62
2008
2012
Source: ONS Crown Copyright, 2013. ‘Annual Population Survey’, January-December 2008 and January-December 2012. From
NOMIS [accessed 24th June, 2013].
What is the ‘Low Carbon’ EU
Thematic Objective 4?
• Separate, but complimentary to EU Thematic Objectives 5 and 6, ‘Climate
Change’ and ‘Protecting the Environment & Promoting Resource
Efficiency’ in Europe 2020
• Emphasises activities in the green/sustainable development agenda that
enhance:
– Job-creation
– Development and adoption of low carbon/ energy efficient technologies
amongst SMEs
– Development of ‘whole place’ solutions in urban design, transport planning,
energy management, climate change adaptation etc.
– Supply chain and knowledge transfer enhancement for development and
production of low carbon goods & technologies, services and processes
• Implication of UK prioritisation of Thematic Objective 4 but not 5 and 6 –
projects/programmes will be favoured if they have a strong emphasis on
the job and output-generating potential of low carbon, sustainable and
energy efficient technologies, products, services and practices
Why is Low Carbon an important
Thematic Objective?
• A ‘cross-cutting’ Thematic Objective, linked to the overarching EU 2020 cohesion objectives of sustainable,
‘innovation-led’ recovery and ‘smart specialisation’
• Key part of the UK Government’s emphasis on growth:
– Job creation and reducing worklessness (Objectives 8 and 9)
– Increased demand for (and incentivising investment in)
workforce skills from employers (Objective 10)
– Innovation (Objective 1)
– Enterprise and SME Competitiveness (Objective 3)
– Output - impact of increased demand from households and
supply chain customers for low carbon products and services
will ‘spillover’ to benefit other sectors/activities
– Productivity - more efficient ways of utilising existing resources
and shift towards higher value-added activities
What are the barriers and market
failures?
• Availability of workforce skills
• Information failures and risk/uncertainty
– On benefits to SMEs and potential investors, and also due to time-lags
between up-front costs and future benefits
– On available support and areas of excellence
– For household consumers and supply chain customers (demand)
• Investment/access to finance
• Infrastructure (including knowledge infrastructure)
• Externalities (where some of the costs or benefits ‘spill-over’ to
affect parties other than those involved in the original activity)
• Externalities can provide a disincentive to investment in all kinds of
innovation (including in low carbon technologies), as the party
making the original investment may not be able to recoup a
sufficient share of the benefits
Defining the Low Carbon ‘Sector’
• A combination of products, services, practices,
technologies and opportunities
• The BIS ‘Low Carbon and Environmental Goods and
Services’ (LCEGS) definition includes:
– Environmental solutions (such as control of air, noise and water
pollution, waste management and recycling)
– Renewable energy technologies (e.g. wind, tidal, geothermal
and biomass)
– Emerging low carbon activities (such as road transport
emissions reduction, nuclear energy, energy management,
carbon capture and storage, etc.)
• With the exception of energy generation and water/waste,
most of these activities occur across many sectors –
including Construction and Transport Equipment
Manufacturing
Profiling the Low Carbon ‘sector’
• BIS define LCEGS in terms of goods/services produced and/or traded,
supply chain activities, and R&D and training activities – rather than SIC
• In all English regions, LCEGS account for between 3.0% (Yorkshire &
Humber) and 3.7% of employment (North East and London)
• LCEGS accounts for 62,500 East Midlands jobs, which is 3.1% of BRES 2011
work-place employment in the region
– Renewable Energy is over-represented in East Midlands, accounting for 34%
of total LCEGS employment, compared to 29% in England
– Low Carbon accounts for the largest share in both the East Midlands and
England (49% compared to 50%)
– Environmental is the smallest LCEGS sub-sector in both the East Midlands and
England (17% and 21% of total LCEGS employment)
• All East Midlands LCEGS employment is 7% of UK total
• EM share of UK LCEGS employment is similar to the East of England, the
South West, the West Midlands, and Yorkshire and the Humber
• Greater share of LCEGS in London (20%), the North West (10%), and the
South East (12%)
Environmental
Low Carbon
Wind
Wave & Tidal
Renewable consulting
Photovoltaic
Hydro
Geothermal
Biomass
Energy Management
Carbon Finance
Carbon Capture & Storage
Building Technologies
Nuclear Power
Alternative Fuels
Alternative Fuel Vehicle
Additional Energy Sources
Water Supply and Waste Water Treatment
Waste Management
Recovery and Recycling
Noise & Vibration Control
Marine Pollution Control
Environmental Monitoring, Instrumentation and
Analysis
Environmental Consultancy and Related Services
Contaminated Land Reclamation & Remediation
Air Pollution
Low Carbon Sub-Sectors
Chart 3: Employment in LCEGS Level 1 categories and Level 2 sub-categories (% of LCEGS total), 2011
25
20
15
10
5
0
Renewable Energy
Source: K Matrix, on behalf of BIS, 2012. ‘Low Carbon Environmental Goods and Services: Report for 2010/11’.
England
East Midlands
Employment in SIC 35: Power Generation and Supply (%), 2011
Source: ONS Crown Copyright, 2012. ‘Business Register and Employment
Survey, 2011.’ Data accessed from NOMIS [17th June, 2013] and analysed
under Chancellor’s Notice Ref NTCBRES11-P0537.
Contains Ordnance Survey data © Crown copyright and database right, 2013.
Low Carbon Assets
• Significant power generation sites – includes 2 co-firing stations
near Retford in D2N2 (as well as nationally important coal-fired site
at Ratcliffe-on-Soar) – and E-ON and EDF energy offices
• R&D intensive manufacturing related to power generation
equipment: includes Cummins in NEP and Alstom and Siemens in
Greater Lincolnshire
• Lower proportion of renewable generation in the region, but hydro,
wind and biomass capacity increasing
• Sector specialisation in Transport Equipment (D2N2 and LLEP)
includes international leaders in low carbon/fuel cell technologies
(Rolls Royce, Toyota etc.) and HE research links
• Centres of excellence include:
– British Geological Survey (D2N2)
– The Energy Technologies Institute (ETI) (D2N2, LLEP and Coventry &
Warwickshire LEPs)
Summary Points
•
•
•
•
•
Cohesion Policy 2014-2020 presents Low Carbon as an integral part of a
sustainable, innovation-led recovery
UK emphasis on potential productivity, innovation, employment and skills
outcomes of Low Carbon projects/programmes
Projects/programmes could address similar barriers/market failure to those that
affect innovation more generally – with some specific skills, information and
investment issues & opportunities
The East Midlands has some key comparative advantages, notably related to
power generation and transport equipment – but also alternative fuels more
widely and building technologies
Opportunities for collaboration between:
– D2N2, LLEP and Coventry & Warwickshire LEPs (low carbon technologies related to transport
equipment and high tech engineering more widely)
– Greater Lincolnshire, D2N2 and NEP in power generation and energy efficient technologies for
the power generation sector (e.g. gas turbine technologies, wind turbines)
– Renewables in rural areas across the EM (e.g. biofuels)
– Collaborative opportunities in green urban planning (Nottingham, Leicester, Derby?)
– The LLEP event identified EM-wide opportunities in the Green Deal for low carbon outcomes
in both household and commercial properties (new build and retrofit )
– Opportunities to link or support EU-funded economic development projects/programmes
with adaptation investments (i.e. through the National Adaptation Programme) – e.g.
improving the viability of development in an area affected by flood-risk
How Can we use EU Funding to…

Move SMEs in all sectors towards
a ‘low carbon’ economy

Adapt to climate change and
reduce/manage the associated
economic risks

Improve resource efficiency and
protect the environment?

Boost SME growth in the wider
‘green economy’
Thank you for coming and have
a safe journey home!