Agenda item

(i)              Joint Report of the Assistant Chief Executive and Corporate Director of Regeneration and Economic Development.

(ii)             Update on the work of the County Durham Economic Partnership – presentation by Professor Brian Tanner, Chairman, County Durham Economic Partnership.

The Chairman introduced the Chairman of the County Durham Economic Partnership (CDEP), Professor Brian Tanner who was in attendance to give an update presentation as regards the work of the CDEP (for copy see file of minutes).

The Chairman, CDEP reminded Members that the five measures of success used by the CDEP were: the Employment Rate; Gross Value Added (GVA); Number of Businesses; Household Disposable Income; and Employment Deprived Index of Deprivation.  The Committee learned that it was a mixed picture in terms of the figures, with the employment rate being slightly down, currently at 66.8%.  It was added that the GVA had improved slightly, being at 83%, and was ahead of the regional figure and on track for the 2030 target.  Members noted that the number of businesses had increased slightly to 515, however this was very slow progress towards the 2030 target of 4,300.  The Chairman, CDEP noted that disposable income was static versus the region and there was also slow progress in terms of the employment deprived index of deprivation, the 2030 target being movement from 174 to 64, with the current performance being 168.

Members were referred to a graph showing the employment rate over time, comparing the UK, regional and County Durham statistics.  The Chairman, CDEP explained that the rate fluctuated, and when taking into account the precision of the data, the latest slight dip in the rate could not be taken as being significant.  The Committee noted that looking at the indexed GVA statistics it could be seen that the value per head was similar to that of Northumberland, less than that of Tyneside and England. 

Members noted that this data did not take into account localised economic conditions or workforce profile, for example age, and was linked to the quality of jobs and issues such as education, skills and pay, all areas which the CDEP were looking to improve.

The Chairman, CDEP explained that when looking at the non-indexed figures for GVA, there was a trend showing growth, albeit slow growth, and when looking at the index GVA per filled job data, discounting long term unemployed and economically inactive, then County Durham compared more favourably, similar to Tyneside and closer to the England figure.  Members were referred to a graph highlighting the trend in terms of the GVA per filled job for County Durham and noted that should the figures continue to increase on trend they would be on course for the 2020 target.

The Committee noted that the CDEP was reviewing its focus on creating more and better jobs, and continuing in its role in terms of the North East Local Enterprise Partnership (NELEP), North East Combined Authority (NECA) and North East European Structural Investment Fund (ESIF) Sub-Committee.  Members were reminded of the successes in terms of DurhamWorks, with £16.7 million of funding and an aim for 2,500 jobs, and of Generation North East, in terms of £4.5 million of funding working towards apprenticeships and 2,000 jobs.  The Chairman, CDEP explained there were several opportunities for further job creation, noting: expansion at NetPark with Phase 3 having an associated 1,000 jobs; new employment sites, Forest Park, 3,000 jobs and Aykley Heads, 6,000 jobs; and the catalysts for investments at Auckland Castle with the Eleven Arches/Kynren, over £30 million of investment and 200 jobs, and Finance Durham with £20 million of investment and 2,000 jobs.

The Chairman, CDEP explained that there were challenges ahead, including issues stemming from the result of the EU Referendum to leave the European Union, and the ESIF allocation of €157 million.  It was added that there are issues in terms of understanding the impact, timescales involved and the next steps.  Members noted that there would need to be a response to changes in Welfare Reform, with the impact on Housing Providers and to help mitigate the impact upon the most vulnerable communities.  Councillors learned that other challenges included: maintaining a focus on aspirations for better jobs; continuing the successes of the Future Business Magnates (FBM) programme, ran by Business Durham (BD); building Social Value opportunities; and continued cross-partnership working.

The Chairman thanked the Chairman, CDEP, noting the impact of the EU Referendum result and the reduced value of Sterling against the Euro and the impact this may have on EU funding streams, and asked Members for their questions on the update presentation.

Councillor D Hall noted his division, Sherburn, bordered the Sunderland area and asked whether the data presented was simply for County Durham and how cross-border issues were taken into account.  The Chairman, CDEP explained that the figures were for County Durham and that as the CDEP would look to raise the employment rate within County Durham, the figures represented County Durham residents.

Councillor E Adam noted that the data showed County Durham at the bottom of statistics both nationally and regionally and added it had long been heard that there would be more and better jobs, and asked where specifically those jobs would come from. 

The Chairman, CDEP explained that there would be investment from outside of the County by multinational companies in new jobs, albeit in a new context post-EU Referendum and also from within the County by encouraging entrepreneurs to see the potential to create a viable business in our area.  It was reiterated as regards NetPark Phase 3 and the Hitachi facility and the knock on effect in terms of the supply chain for these high quality science and manufacturing jobs.  Councillor E Adam noted that from his perspective there were still a relatively small number of jobs in terms of high wage, high skilled employment, with not all the new jobs being created being at that higher level.  The Chairman, CDEP disagreed noting that while not all the jobs created were at the highest possible level, they were considerable more skilled and better paid than existing zero-hour contract jobs.  It was added that while the numbers may appear small in isolation, it was reiterated that there was a knock on effect in terms of supply chains and also in demonstrating the value in investing in County Durham to other potential employers.  The Chairman added that the push in terms of skills development would help and that the issues were to build confidence in the County and to look at issues to help investment such as business rates.

Mr T Batson noted that he felt there was a need to not forget the basic skills, and to aim for a good level of understanding of mathematics as a foundation for developing the next generation of engineers and scientists.  Councillor J Armstrong noted that County Durham was doing very well in terms of young people’s academic achievement.

Resolved:

That the update presentation be noted.