How can the North East capitalise on devolution?

With Kim McGuinness elected to lead the north of the region’s devolution power grab, attention now turns to rolling out the measures needed to catalyse landmark economic and social change.

Here, in the second of a series of executive-level roundtable discussions held by North East Times alongside Fairstone, the UK’s fastest-growing wealth advisory firm, regional business leaders analyse the North East Combined Authority’s potential and the moves needed to deliver tangible growth and prosperity.

Words by Steven Hugill

Photography by Angela Carrington

  

WHAT DOES THE NEW COMBINED AUTHORITY MEAN FOR THE NORTH OF THE REGION?

To speak of the North East’s past is to paint pictures of rising smoke contrails from the locomotives that pioneered rail travel, of the doughty dust-covered miners emerging from underground coalfaces and of the behemothic seafaring vessels peering over terraced streets.

What, though, of the future?

How does the region define itself today? And what will become its industrial chapters of tomorrow?

Fundamental to answering those questions, said roundtable members, will be the North East Combined Authority.

Having refreshed the political page from County Durham to Northumberland, they said the body must maximise its Westminster power grab by setting in motion moves capable of stimulating similar headline successes.

To do so, speakers encouraged creation of a new identity, one that strips away previous legislative complexities and harnesses past glories with present-day triumphs across the manufacturing, renewables, digital and life sciences sectors.

“One thing that has been missing from the region for a long time is our unique selling point in the world,” said Dr Arnab Basu, co-founder and chief executive of Sedgefield-based radiation detection kit maker Kromek Group.

 

• Dr Arnab Basu, centre, with Kevan Carrick, left, and Ed Twiddy

 

He added: “The regional development agency One North East started to create an identity and message, but that has been lost since its demise.

“We need to very quickly identify what the region stands for.”

He found support from Clare Loveridge, vice president and general manager of Europe, the Middle East and Africa at global cybersecurity firm Arctic Wolf, who said the region must rid itself of a revelous reputation.

She said: “We have an identity, but it’s the wrong identity, and it hasn’t changed from the time I was a child.

“People don’t think about there being wealth in the North East, they think about the good night out they’ve had – and that sticks.”

Chartered surveyor Kevan Carrick, co-founder of Newcastle-based JK Property Consultants, added: “The brand is very important, and we need a strong economic growth plan and the mayor to act as a marketeer.”

Ed Twiddy, director of environment, society and government at Durham-headquartered digital lender Atom bank, agreed, saying a coherent narrative will be critical if the north of the region’s elected leader is to succeed in an ultra-competitive national metro mayoral landscape.

The ex-North East Local Enterprise Partnership director, who helped roll out the development body’s flagship ‘More and Better Jobs’ campaign, said: “The new mayor has a huge opportunity to deliver change.

“But they’re in a bun fight, and they must recognise they will be going toe-to-toe with people like West Yorkshire mayor Tracy Brabin, Greater Manchester mayor Andy Burnham and West Midlands mayor Richard Parker.”

 

HOW IMPORTANT IS A QUALITY AND SUSTAINED HOUSING SUPPLY TO THE FUTURE SUCCESS OF THE REGION?

No business blueprint, social strategy, fiscal formula or development drive has ever succeeded without a stable base.

The north of the region, however, has foregone such steadiness in recent years, the breakdown of George Osborne’s proposed devolution deal eight years ago instead engendering an alternative state of flux.

The North East Combined Authority, though, said roundtable members, affords a chance to reset the dial.

But they warned it will only happen if the foundations that underpin economic and social progress are fortified with fresh strategy.

And upon those footings, said Ian Johnson, executive director of customer services at North East housing association Karbon Homes, must rise affordable properties.

Citing recent figures showing more than 75,000 people are now waiting for social housing across the region, he called on mayor Kim McGuinness to put literal building blocks in place to help individuals improve their life chances and, by association, the North East’s wider prospects.

He said: “We haven’t got to grips, as a country, with creating affordable housing at scale for 40 or 50 years.

“There is a lot of building going on, but it’s across three and four-bedroom private sector homes, which are out of reach for a lot of people.”

 

• Clare Loveridge, vice president and general manager of Europe, the Middle East and Africa at global cybersecurity firm Arctic Wolf

 

He added: “People are being left behind, and even if we continue at the current building rate, it will be around 30 years before the person at the bottom of the waiting list gets a property – and that will only happen if the rate remains static.

“If someone doesn’t have a stable home they can afford and can feel safe in, then the rest of their life is going to be very difficult.

“We need a long-term, strategic vision for the housing crisis.

“We have five-year parliamentary cycles, but this needs a plan that covers a minimum of 30 years.”

Ian found support from Kevan, who called for a “radical approach” to increasing social housing stock.

He said: “There must be a huge attack on housing; we need a much higher percentage of affordable homes built.

“The industry norm is about 20 per cent, but it needs to be higher than that, certainly in the initial period, to start making positive change.

“We need the mayor and the combined authority to establish a strategy – one that ensures a clawback from development gains on land prices – to fund affordable housing.”

Ian and Kevan were backed by Chris McHugh, head of public affairs at Newcastle-based public affairs consultancy Stephenson-Mohl, who pointed to the social benefits of a secure home environment.

He said: “The North East is top of the league when it comes to child poverty and child obesity – and housing is an essential factor in both of those metrics.

“The deeper devolution deal (which was announced in March and commits to greater powers around areas including affordable housing) talks about a much closer relationship with Homes England.

“And the mayor must identify challenging development sites and use their role to bring the investment needed to increase affordable housing.

“There is also an opportunity to look at a regional spatial strategy, and ensure some degree of partnership, to help identify what the future will look like in 30 years’ time.”

 

EDUCATION IS ANOTHER FUNDAMENTAL GROWTH PILLAR. BUT IS ENOUGH BEING DONE TO DEVELOP THE REGION’S TALENT PIPELINE?

From Tony Blair’s ‘education, education, education’ ambition to see half of young adults in university, to the fall and rise of apprenticeships and Rishi Sunak’s more recent maths until 18 move, the UK’s skills agenda has long been a moveable feast.

Yet for all the variety, roundtable members said rather than satisfying companies’ skills appetites, the changing menu has instead delivered a famine-like effect.

Richard Brown, chief executive of Newcastle-based Melius Cyber, which protects clients from online threats, called for watershed revision of the skills map through a siloed venture that would stand outside Westminster’s five-year churn.

He said: “We need to tear the education programme up and start again.

 

• Richard Brown, chief executive of Newcastle-based Melius Cyber

 

“We need to know what skills the country needs now, and what it is then going to need in 15 years.”

Clare backed Richard’s argument, calling for accountability to stop any plan “falling by the wayside and disappearing”, as did Lee Hartley, chief executive at event host Fairstone, which operates as the UK’s fastest-growing wealth advisory firm.

In addition, Lee advocated a prioritising of courses and qualifications key to generating future economic success, pointing to a dearth of skills across areas such as software development.

He said: “Education is a catalyst for prosperity; the social housing waiting list isn’t going to change unless people have jobs that give them more freedom and the ability to succeed.

“But to make that happen, we need to have the conversation with schools and universities that while certain courses are worthwhile, they’re not necessarily going to create the type of wealth and prosperity we want and need.”

 

WHAT MEASURES COULD BE IMPLEMENTED TO STRENGTHEN TIES BETWEEN INDUSTRY AND EDUCATION?

Leaning on his experiences as a school governor and teacher, Chris cited the Ryder Architecture and Gateshead College-led PlanBEE apprenticeship programme – which prepares youngsters for construction management, engineering and rail sector roles – as a pattern from which to create a larger training template.

He said: “Schools are crying out for better advice, and are desperate for earlier career pathways.

“PlanBEE is an incredible example of that, and I know there are discussions underway across the financial services and digital sectors to do something similar at further education level.

“And the new mayoral authority must build on that.

“As part of the devolution deal, a strategic relationship will be formed between the combined authority and further education, which provides real opportunity to set people off on the right path.”

Chris was supported by Richard, who said real progress will only be attained through a harmonious blend of learning.

He said: “We must give children the opportunity to think more clearly earlier in their lives about what they want from education and where it is going to take them, whether it be to university or towards a vocational route.

“The Prime Minister’s idea of everyone doing maths until 18 isn’t going to find us bricklayers or electricians, for example.

 

• Dr Fozia Saleem, chief executive at Sedgefield-based Magnitude Biosciences, with John Duns, North East Times’ director and roundtable host, left, and Chris McHugh, head of public affairs at Newcastle-based public affairs consultancy Stephenson-Mohl

 

“And there are some who still think social mobility means sending a child to university – but it doesn’t.

“For some, it means getting a job that provides a steady income, which leads to financial security and a roof over their head.”

Ian added: “We must create opportunities for young people to better see a trade as a worthwhile option.

“To do that, we must build new infrastructure and showcase opportunities around net-zero and renewable technologies, for example, to highlight the possibilities they have in providing long-term employment.”

They were backed by Dr Fozia Saleem, chief executive at Sedgefield-based Magnitude Biosciences, who urged mayor McGuinness to create frameworks capable of better connecting students with workplace realities.

She said: “I did a biomedical science degree at university, but what was really pivotal to my career was an industrial placement at GlaxoSmithKline’s research and development headquarters, in Stevenage.

“It allowed me to see there were so many other careers out there beyond being ‘a scientist’.

“And it spurred me to do a PhD and look at commercialising STEM,” added Dr Saleem, who is a mentor for The Girls’ Network, which empowers young women from disadvantaged communities to access higher education.

Clare agreed, calling for schools, colleges and universities to better nourish students’ knowledge of the region’s sectors and specialisms, which she said would remove a prevailing “lack of awareness of opportunity”.

And she was backed by Dr Basu, who warned of a continued talent defection without sufficient action.

Clare said: “It’s about building the talent, as well as retaining the talent.

“Even though we have an awful lot of STEM students in the region, there nevertheless remains a huge problem around educating people of the opportunities here.”

Dr Basu added: “We need to make this region a home for the future because, presently, not many graduates see it as that.

“We have two highly research-intensive universities in Durham and Newcastle, and three other universities doing very good research in certain sectors.

“But the translation of that into innovation and jobs is a cycle that hasn’t been well enough connected over the last 20 years.”

The discussion was taken on by Ed, who spotlighted Atom’s responses to talent challenges in the post-COVID-19 landscape.

Pointing to scholarships delivered through Durham University’s Women in Technology programme and the Atom Futures Fund that – alongside the County Durham Community Foundation – supports students from low-income backgrounds and care environments to attend Russell Group universities, he highlighted too its backing for the nascent Durham University Maths School.

He said: “We had built a very strong data science team, but lost people during the pandemic, so launched schemes to replace them across the short, medium and long term.

“We want to foster a new generation of excellence in STEM with students from the region.

“And it’s much easier to recruit through relationships with sixth forms, and then let them go to university.”

 

THE REGION’S TALENT STREAM FEEDS MANY ORGANISATIONS, INCLUDING A GOOD NUMBER OF START-UPS AND SCALING BUSINESSES THAT RELY TOO ON EARLY-STAGE FUNDING. BUT IS THAT MECHANISM DOING ENOUGH TO NURTURE SUFFICIENT NUMBERS OF NEXT GENERATION COMPANIES?

For any business wanting to expand its marketplace footprint, cash is a fundamental factor.

But with investors’ changing priorities matched by the high-profile winding down of European Regional Development Fund monies, companies are facing very different dynamics.

However, Ed, who was recently named chair of Newcastle-based investment house Northstar Ventures, said the north of the region’s new mayoral authority provides scope for meaningful change.

Highlighting the impact of the Northern Accelerator programme – which marries business leaders with research teams from universities across the North East and York, to transform ventures into real-world applications – he said: “We must crack the funding nut.

“The landscape is now less rich at the very early stage, and much more interested in growth.

 

• Lee Hartley, chief executive at event host Fairstone, which operates as the UK’s fastest-growing wealth advisory firm

 

“But we cannot have programmes like Northern Accelerator finding and funding great proof of concept opportunities, and then allowing them to fall off the conveyor belt.

“With the new mayor comes great opportunity to re-jig how funds are allocated.”

Dr Saleem concurred, calling for a mirroring of the unity within the region’s life sciences sector, which serves to sell the region, and its companies’ innovation, to audiences worldwide.

She said: “A business is funded at the beginning but can then be left to fall off a cliff-edge; any company seeking high growth is almost left on its own.

“Our region’s life sciences sector has recognised that; it has come together and grown stronger for doing so,” said Dr Saleem, who is vice-chair of the newly-formed Newcastle Growth Board, which aims to make early-stage funding more accessible to female founders across the region.

She added: “Ultimately, it has shown we can be better if we work together, and that we don’t always have to be out fending for ourselves with sharp elbows.”

 

HOW VITAL ARE GOOD TRANSPORT LINKS TO THE REGION’S FUTURE PROSPERITY?

The North East may have given rail travel to the world, but all too often its modern-day transport links leave its economic ambitions stuck in the sidings, warned roundtable members.

Lee said: “We need to make the North East easier to do business with.

“Train travel is very expensive – I can fly to our Dublin office for a quarter of the price it takes for a rail ticket to London.

“I also can’t go to Bristol and back in the same day, and the region’s transatlantic flight closed after a very short window.

“If we improve connectivity, business will flourish.”

 

• Ian Johnson, executive director of customer services at North East housing association Karbon Homes

 

Dr Basu agreed, calling for better cross-region public services, which he said would help attract and retain workers, including the “high-calibre graduates” from the North East’s universities.

He said: “Travelling from rural Northumberland or Sunderland to Sedgefield, for example, represents a very difficult commute that ultimately requires a car.

“We need to get people more mobile and in a seamless way.”

Chris added: “There is a disconnect.

“Bus services have been cut back substantially over recent years, and the new mayoral deal provides an opportunity to change that.”

 

HOW CAN THE NORTH OF THE REGION’S BUSINESS COMMUNITY SUPPORT THE MAYOR AND COMBINED AUTHORITY TO DELIVER POSITIVE CHANGE?

While elected with a multitude of pledges, roundtable members agreed the mayor’s endeavours must be accompanied by commercial sector support.

Ed said: “The mayor has to sell the region, but we have to help by providing the ammunition.

“We’ve reached a point where our skill sets are internationally competitive and where our technologies are world-beating.

“And we must now scale that.

“As a society, we are getting increasingly older, and the only way to face into that is to be a high skills, high-earning economy.

“If we don’t, we will go backwards, and we can’t allow that to happen.”

Kevan added: “We will not grow unless we are united, and collaboration between the public and private sectors will be crucial to that.

“As a region, we must think about where we are, and where we want to get to, and we must get that message across to people in the North East and beyond to make it a reality.”