New Directions

1. In partnership with: New Directions Economic Renewal: New national and local policies www.enfield.gov.uk/newdirections Striving for excellence

2. In partnership with: Enfield WelcomeCllr Doug Taylor Leader of the Council

3. In partnership with: Conference Background: • The co-ordinating Council • Starting the economic debate • Experimenting with concepts likely to improve our economic base • The economic challenges • Opportunity to think freely

4. In partnership with: Welcome from ESRC Dr Paul SandersonDeputy Head of Knowledge Exchange, Economic and Social Research Council

5. In partnership with: The View from the Frontline Rob Leak Chief Executive Enfield Council

6. In partnership with: Enfield: Location

7. In partnership with: Enfield: Growth Corridors

8. In partnership with: Enfield: Long Term Decline • Population – 300,000 • Unemployment –above London average • Inequalities • Skills and education – Great extremes but on average below London level • Business Growth – Low net business formation

9. In partnership with: Enfield: Decline in Private Sector LB Enfield: Percentage change in employment by sector 1998-2008 1998: Total =93,826; Private sector =71,467; State & para-state =22,359 2008: Total =92,505; Private sector =62,960; State & para-state =29,545

10. In partnership with: London: Increase in Private Sector London: Percentage change in employment by sector 1998-2008 1998: Total =3,763,873; Private sector =2,945,329; State & para-state =818,544 2008: Total =4,168,468; Private sector =3,217,440; State & para-state =951,028

11. In partnership with: Enfield: Low GVA Growth

12. In partnership with: Enfield: Response • Significant regeneration activity • Engagement with business • Driving case for investment in infrastructure (rail / road / decentralised energy networks) • Innovative & creative solutions (market gardening)

13. In partnership with: Enfield: Opportunity • £2.1bn GVA per annum growth opportunity • Current planned interventions necessary but not sufficient • Need to broaden our thinking

14. In partnership with: Michael MoranCRESCUniversity of Manchester

15. In partnership with: Popular Engagement with Local Government in the UK • Where have the party members and voters gone? • Collapse of popular engagement via party membership • Popular participation through voting in Westminster elections has fallen • Approximation to regional government in England • Enfield conforms to the national pattern

16. In partnership with: Why The Crisis In Engagement? • Local autonomy and initiative are also among the most restricted in the EU • A decline from the historic importance of the local authority as key institution in welfare and other public services • A Key issue for today’s conference: how can local authority claim/reclaim a key role in local economic development?

17. In partnership with: Karel Williams DirectorESRC Centre for Research on Socio-Cultural Change

18. In partnership with: 80s “deindustrialisation”:(trade) crisis foretold 80s prophets of Brit “deindustrialisation” = foretold pays crisis; activity mix = structural constraint on growth and jobs 90s and 2000s outcome = the worst did happen and the result was very agreeable • Male working class lost as manufacturing employment 1979-2009 = 7 -2.5 mill; ex industrial districts of North and West >20% of wing age population parked up on benefit plus 2 generations of worklessness; ….BUT jobs for everybody else • Trade balance on manufactures negative from 1983 with goods deficit of £90 billion by 2009; yet no crisis with windfall gain of North Sea oil and currencies redefined as asset classes (not as index of real economy)…..So MCs had German cars and everybody had cheap/low wage manufactured goodies

19. In partnership with: Thatcher and Blair:(financial) crisis postponed Promised a working future and delivered an unsustainable boom; drivers of jobs + GDP growth (boosted by dereged finance = priv. profits + liabils = 5X GDP) • Jobs creation ex state and para state health, edn and welfare; 1/3rd of all jobs and > ½ extra New Labour jobs were publically funded; • Consumption demand ex housing equity withdrawal: HEW > GDP growth under Thatcher and Blair; peaking at 5% of GDP. 2008 financial crisis = structural constraint ex activity mix: • end of state job creation / private sector with weak capacity to create jobs outside London: none in North East or West Midlands • chronic demand deficiency ex (a) pro cyclical housing finance/ mortgage repayment and (b) trade deficit sucks demand • pays deficit with energy and food insecurity; financial markets now distracted but not obliged to hold Sterling.

20. In partnership with: Structural/econ crisis also a political/cultural crisis Westminster and Whitehall can’t stand too much reality • Deny crisis via demands for return to growth + alibis about the eurozone crisis • Rhetorically embrace rebalancing = for Mandelson + Cameron/Osborne more manufing but not less finance • Favour policy dualism of restrictive fiscal policy + ultra loose monetary policy (QE + low interest rates) Westminster and Whitehall don’t do renewal: • Political base and calculation: parties are Westminster cliques connected with electorate via Gouldite politics + allied to London finance… in a country that is breaking up. • Technical resource and expertise: renewal needs focus on activity base via industrial policy + regional policy; does civil service have expertise for encouraging new activity and managing old

21. In partnership with: Problem (1) legacy of “enterprise” thinking 30 year enterprise experiment ( revn. fails because it is incomplete) • Generic policies : low taxes, privatisation, deregulation, flex. labour markets, free trade (ignore activity differences) • Unsuccessful regions or groups ? compet. success by improving infrastucture or training: Centre for Cities etc Identified important policy levers but never pulled them effectively • UK infrastructure widens inequality: London + the SE is subsidised with 84% of planned gov. spending; grand projects for the North like HST without local connections for desenclavement • Vocational training never recovered from the collapse of the large socially responsible private employer; less than 2,000 factories employing more than 200 and ¾ of manufacturing employ is in workshops employing 10 or less;

22. In partnership with: Problem (2) no new thinking about sectors Civil service has lost the plot: • Monstered industrial policy as “picking winners” = traducing BL, ignoring RR; not honouring Norman Smith in N Sea oil procurement successes like RR • Lost expertise on private sector (maps + links, capabilities + capacity gaps); careers made by managing public sector reorganisation + putting out contracts. Politicians and think tanks talking but not doing sectors: • From Mark Prisk to IPPR list big or high tech sectors; neglect unglamorous private sectors like food processing (probably the largest consumer of machinery in the UK); and promote disintegration of public sector health and edn. • Cultural bias towards point source of value/ outsourcing and contracting out; what to do when DfT train contracts or Tesco bacon buyers produce point success and chain collapse? No interest in the Morrisons model of vertical integration .

23. In partnership with: Problem (3) starting from a low level Manufacturing is in a bad way • Problem of broken supply chains: JCB digger 1979-2009 = 96-36 % Brit by value; Bombardier imports its bogies from Germany; • No sustained output growth since 1970s + cyclical fluctuations; manufacturing investment declines in 2000s to < 10% of net output Multiple delusions of grandeur + come back: • Day dreams of export success; electric cars today or graphene tomorrow will be developed by well resourced competitors; • Unposed question of what to do about UK branch factories; will UK acquiesce on Opel/Vauxhall Ellesmere Port closure?. • No focus on import substitution in mundane activities ( vis a vis North European competitors); • No commitment to maintain public employment as the only credible short term palliative in eg West Midlands (where LEPs are doing renewal without institutions or resources )

24. In partnership with: Implications? (1) the scope for fiscal policies Policy response to crisis? How to change the UK activity mix (run industrial policy + regional policy) when the civil service lacks expertise + Westminster politicians are likely to resist serious changes? (1) Much more reliance on selective sector specific fiscal policies/ break with generic pro enterprise policies • Incentive packages for sector specific objectives eg we ‘d want value added promotion via corpn tax concessions for organic output growth in manufacturing + for vertical integration in supermarkets; in manufing add investment incentives via deprecn. allowances + employment incentives via national insurance. • Policies which require specific justification but don’t require lots of expertise; neither of the left nor of the right; what ‘s good enough for Rick Santorum …….

25. In partnership with: Implications?(2) the revolution in government (2) We need a different and more active kind of government: • Not governance but old fashioned government ( ie elected politicians + civil servants) with an economy wide agenda, committed to acquiring sector specific knowledges and varying policies accordingly • This is more than central government can cope with (at least until populist discontent intrudes); and much more than local government aspires to…. • Given the politics of Westminster and Whitehall much will depend on regional and local experiment ……..

26. In partnership with: David Green Director - CIVITAS

27. In partnership with: The Political Case for New Policies: Political Benefits and Possibilities for Local Action Ben Jackson University of Oxford

28. In partnership with: Sukhdev Johal Royal Holloway University of London

29. In partnership with: Local Possibilities and Guerrilla Economic Development • Why national policies from central government are unlikely to be the active, initiating force • National government can’t pay and won’t pay • The civil service has lost any sectoral expertise • The default remains non intervention except to make markets work better

30. In partnership with: Local Possibilities and Guerrilla Economic Development – continued • If the aim is renewal, import substitution, job creation etc, local government is an unlikely hero • Let’s start with several policies that cost little and make a difference • Then get some funding so local government can build social housing and invest in infrastructure and also think about moving back into running businesses which yield a surplus

31. In partnership with: Open Discussion Will Davies Centre for Mutual and Employee-owned Business University of Oxford

32. In partnership with: Comments and Overview Sir Peter Hall Professor of Planning and Regeneration UCL and President Town and Country Planning Association

33. In partnership with: Comments and Overview Tony Jackson Contributing Editor Financial Times

34. In partnership with: Introduction to Afternoon Activities Neil Rousell Director of Regeneration, Leisure & Culture LB Enfield Kevin Hughes Deputy Assistant Commissioner London Fire Brigade

35. Redressing the balance: Are Enfieldans getting as much from the big corporations as they are getting from us? Cllr Achilleas Georgiou Deputy Leader, Enfield Council Cllr Alan Sitkin Chair, Sustainability scrutiny panel (European Business School London) In partnership with:

36. Supply side economics:the voodoo that you do so well… Background: Reagan/Thatcher paradigm shift 30 years ago leading to: Fall in global ‘wage share’ (compensation/value added) Fall in corporation tax rates (Laffer curve? Rather the laughing curve) Consequences: Squeezed middle (weaker multiplier effect); Disparities (we’re all in it together?) Deficits (destabilised financial systems); Capitalism for the poor, socialism for the rich? What to does this mean for our borough? START BY MEASURING BIG COMPANIES’ TRADING PROFITS IN ENFIELD In partnership with:

37. The Big Retailers(AND WE DON’T EVEN HAVE STATS FOR 3 BP STATIONS, 2 SHELL STATIONS, ETC) In partnership with:

38. The Big UtilitiesConversion factor: 300k inhabitants in Enfield vs. 60 mil in UK = .005

39. The Big Banks In partnership with:

40. The status quo needs to change… While Enfield de-industrializes, these 18 companies make an est. £84.4 mil annually in pre-tax trading profits, i.e. even after accounting for wages paid to their (very few) full-time local employees After average FTSE 100 tax rate of 26%, they make an est. £62.5 mil annually in net profits from Enfield alone. Split into: - retained earnings/fixed investment? UK among lowest in OECD - dividends? UK amongst highest in OECD (financialization?) SO WHAT KIND OF NEW DIRECTION CAN WE TAKE? In partnership with:

41. Corporate Social Responsibility (CSR): building brands…but how? Corporate brand and reputation are important But CSR thinking needs to change c.f. GDF SUEZ: Corporate image – ‘Aims to set the benchmark in corporate social responsibility. The challenge is realised by setting concrete, quantified objectives and action plans implemented across the Group’s various entities.’ Heading towards a professionalisation of CSR? In partnership with:

42. The Power of CSR and Branding 65% of executives believe product brands benefit from a company’s reputation 55% of executives believe people care about the companies behind the brands 70% of consumers avoid products if they don’t like the company 67% of consumers check product labels (‘company identification’) 86% companies are making greater efforts to build reputation In partnership with: Source: Weber Shandwick (2011) ‘The company behind the brand: in reputation we trust’

43. What CSR measures are companies taking at present to enhance their reputation in Enfield? Tesco – charity fundraising stalls Asda – donations to a local school Santander – ‘Social Enterprise Development Award’ RBS – ‘NatWest Community Force’ etc. And we are thankful. Of course… In partnership with:

44. But what else might be done? See what is being done elsewhere Barclays, in different countries - Supports young people starting their own businesses RBS, in India - Sponsors community setting up an eco-tourism centre BP, in Egypt – Offers technical skills training programme Allianz, in Romania - Provides vocational training for 16-18 year olds at technical college Tesco, in South Korea - Funds 107 schools of extended education (total 940,000 (!!) places) In partnership with:

45. The scale of the challenge in London and Enfield: Un/Employment, Graduates and NEETs National unemployment: 8.4% and rising fast (c.f. ONS, 15 February 2012) (London average – 10%: second highest in UK) (c.f. ONS, 15 February 2012) ENFIELD OVERALL UNEMPLOYMENT RATE = 11% !! Youth Unemployment (aged 16-24): 22.2% across UK (c.f. ONS, 15 February 2012) (London average>23% in autumn ‘11 – higher now!) Graduates: 27.7% across UK without full-time jobs after three years (c.f. BBC, 2 Sept. 2011) NEETs in Enfield: aged 16-18 > 5% aged 16-24 >20% In partnership with:

46. The scale of the challenge in Enfield: Un/Employment, Graduates and NEETs (cont.) Total number of people looking for work in Enfield has risen by 17.9 per cent in the past year to 10,721 Just 1,296 vacancies for people to apply for in Enfield vs 10,721 jobseekers Across London 233,673 people are looking for work vs.32,843 vacancies Nr. young people out of work (18-24 years, claiming Job Seekers Allowance for 6 months) in Enfield has risen by 156 per cent in the past year to 770. The number of young people out of work of across London is now over 1 mio Source http://joannemccartney.co.uk/2012 (20 January 2012), usi ng JobCentre Plus statistics In partnership with:

47. Economic and Social Responsibilities go together "We believe that our status as leader in the Romanian insurance market obliges us to be socially active over the long term... We hope our project will be exemplary in showing that companies with economic goals and interests also have a social responsibility towardsthe market or area they are operating in.” Christian Constantinescu, Director, Allianz-Tiriac Insurance. In partnership with:

48. The opportunity (and need) for deeper CSR in Enfield Supporting youth training and local employment: Putting people at the heart of CSR After all, business also benefits from an upgraded workforce (advanced skill set; higher productivity; greater creativity) One example: October 2012 LBE/Southgate College Environmental Techniques Fair Tomorrow’s industries: - environmental construction (refurbishment, new technologies) - complex products and infrastructure (electric vehicles; fibre optics) Investing in workers to drive industrial regeneration In partnership with:

49. In partnership with: The LB Enfield Initiatives Local regeneration and tailoring policies to meet local aims Cllr Del Goddard Cabinet Member for Business and Regeneration LB Enfield

50. Local regeneration and tailoring policies to meet local aims • What is local • Understanding the historical wealth of Enfield • Mitigating and utilising external policies and strategies • The current approach