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Opinion: Martyn Rawlinson on how the City Deal challenge is to ensure that bigger is better

Posted on - 15th September, 2013 - 8:00am | Author - | Posted in - Business, News, Opinion, Preston Council
preston ringway

Improving the road network in the city and surrounding area would be a key priority for any City Deal bid from Preston

Preston seemed to be the centre of the universe on Thursday, albeit briefly, when the government awarded Central Lancashire a flagship ‘City Deal.’

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To put this in context, City Deals have only been awarded to major UK cities so far, conurbations like Manchester were the only ones seen to be responsible enough to take control of their region’s economic destiny.

The award to Central Lancs, with Preston it’s principal economic driver, was engineered by a report by charity think-tank Centre for Cities followed by intense lobbying from a group of medium sized cities including Derby and Sunderland. It was Preston, South Ribble and Lancashire County Council however, who got their act together quickest.

The City Deal is designed to pull together various funding streams from central and local government in order to channel them into an area with potential for growth. It is financed via a ‘snowball effect’ – new roads should generate housebuilding and employment, these generate New Homes Bonus from the government and increased business rates which are ploughed back into more roads, more houses and more businesses. This should trigger wider benefits through further investment by employers and developers into business and technology parks and city centre projects, taking advantage of the ready made infrastructure, workforce and customer base. Even pension fund holders have threatened to join the party.

Ironically, Preston’s unsuccessful attempts to attract major redevelopment over the last fifteen years has contributed to the success of the City Deal bid because much of the homework required to convince the government that this area has the potential to deliver growth had already been done.

Preston’s participation in the bid has been whole-hearted. The mantra at the Town Hall has been ‘it’s the only game in town, we’ve got to play it.’ However, Councillors are not without reservations.

The coalition’s model for regional growth is distinctly light touch and low intervention, i.e. build a road and let it happen. It is also a huge subsidy to a housebuilding and employment market lacking in confidence and risk averse. The governance of City Deal is by a board that includes unelected businessmen and a private sector chair. The government themselves are not investing any ‘new’ money in the area, just redirecting existing funds. The councils are being asked to invest millions of pounds of future funding they can ill afford. To cap it all, there is no guarantee that if the roads are built, the houses and employment growth will follow; or how long it might take. A realistic estimate for significant development is 7-10 years.

Despite these reservations, City Deal is likely to make Preston bigger. It is an opportunity to direct growth somewhat, rather than just suffer the consequences of untamed development or even stagnation. Central Lancs needs investment and a strategy to help it wrestle some industry from its wealthier neighbours. A thriving Central Lancs should spill its prosperity into the wider sub-region. A spin off will hopefully be city centre regeneration.

In the coming years, Preston Council will continue to play its part in the governance, planning and funding of City Deal. In the meantime, Labour Councillors will contend with austerity and making Preston a fairer place to live with its social justice policies.

City Deal will make Preston bigger, the real challenge for politicians is to make sure that bigger is better.

What do you think about the City Deal? Let us know your thoughts in the comments below

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