Inclusive growth at city-region level: a perspective from Greater Manchester

Greater Manchester is an important test-bed for how inclusive growth can be put into practice at a local level

Ruth LuptonThe Inclusive Growth Analysis Unit (IGAU) was established in January 2016 by the Joseph Rowntree Foundation (JRF) and The University of Manchester, as part of JRF’s work on cities, growth and poverty, and the University’s new Urban Institute and wider efforts to support the ‘Devo-Manc’ process.  Over the last year we have set out both to advocate for inclusive growth and to provide a research resource to help city leaders and other stakeholders know what to do and to understand the effects of different approaches.  Guided by a multi-stakeholder advisory group, we reported first on the challenges and opportunities to inclusive growth in Greater Manchester – a kind of ‘call for action’.  At the same time, we consulted broadly across sectors on what inclusive growth might and should look like in our city-region.  We’re now fleshing out some of these ideas with more detailed research-based briefings to inform the debate around the upcoming Greater Manchester mayoral election.

So what have we learned about inclusive growth from a year in the thick of conversations in the city at the forefront of the devolution process?

First, we’ve learnt lessons about inclusive growth as a term and a concept. Our consultation report revealed that there are broadly two spheres of action upon which stakeholders agree: developing a more inclusive economy; and connecting more people to economic opportunity – the latter including a very broad suite of issues including housing, care and transport as well as education and skills.

There are tensions here though. One is about breadth.  Should inclusive growth just be about the economy – is this what distinguishes it from a broader social justice or environmental sustainability agenda?  Related to this is the chicken/egg conundrum.  Should social policies such as housing, health and childcare be included here because they lead to a more inclusive and therefore more productive economy, or should we be evaluating all our economic decisions in the light of their contributions to broader social goals such as health and wellbeing?  Lastly, how much emphasis should be on growth (future) rather than redistribution of existing prosperity?  Do we need to wait for growth, is one argument, while another is that the planet cannot actually sustain more growth, so we should be thinking about inclusive economies on their current size at most.

Our experience in Greater Manchester is that so far, people working for the same goals in terms of reducing poverty and inequality are prepared to embrace ‘inclusive growth’ as an articulation of the broad direction of travel. New coalitions can be formed on this basis.  But it remains to be seen how these are translated into strategy and practice.  There is a clear danger that stakeholders will sign up to inclusive growth in a ‘motherhood and apple pie’ way and that one or two additional things will get done, with no overall transformational effect.

We have also learned that ‘inclusive growth’ doesn’t resonate very well with businesses or business representative organisations, although there are firms in Greater Manchester who are leading and championing exactly the kinds of practices that are needed: local recruitment and procurement; supply chain development; flexible hiring; workforce development; promoting apprenticeships; paying the Living Wage and so on. Businesses are crucial to the inclusive growth agenda.  A key challenge nationally and locally will be to leverage change in business behaviour using a language and an evidence base that makes sense but which also leads to genuine change.  We are now exploring some of these issues in our current work.

Second, leading inclusive growth at a local level demands new ways of working and new kinds of knowledge and capacity. Not only are policymakers in areas like Greater Manchester dealing with upscaling from the local authority level to a city-region level and with new responsibilities and budgets, they are also, with inclusive growth, having to break down some traditional silos between economic development and social policy.  To do ‘inclusive growth’ properly, economic development officers will need to think about the distribution of benefits as well as overall growth, transport officials about the structure of subsidies, health officials about what health benefits (and savings) can be made through their own and others’ employment practices.  Different processes will be needed such as new cost-benefit analysis tools, commissioning frameworks, guidance documents, and staff training, and cities will need to reorganise their own resources.  We are moving into new territory with such a holistic economic/social agenda.  In Greater Manchester, the IGAU has been able to play a key role in pulling together evidence and convening people across networks, but a much greater resource is really needed – perhaps in the form of a national inclusive growth academy, where local personnel could gain access to research and practice examples, networks and training.

Third, central government is in the way. I mean this partly as a point about England’s highly centralised governance structure.  By contrast with cities in other countries there are no powers to raise money locally, run schools, or make rules about welfare payments or conditions, for example.  There is no possibility of a city in England deciding that the most sensible route to an inclusive economy and society in the face of technological change would be to offer a citizen’s income.  There are no mechanisms for raising money locally and recirculating it into local businesses.  The hyper-central plus hyper-local configuration of the school system is the most obvious problem.  Never mind curriculum, pedagogy, and school improvement, cities in this country cannot even coordinate careers advice, employer links, or the allocation of funding where it is most needed.

But I also mean that specific current policies of central government are getting in the way. Three issues have occurred most commonly in our consultations: the role of a punitive welfare system in preventing sustained employment; cuts to the services which underpin inclusion in the labour market (such as adult and community learning, libraries, Sure Start centres and employment tribunals); and cuts to social security which are taking money out of local economies.  For this reason, while I agree wholeheartedly with the Joseph Rowntree Foundation when it argues that cities can get on with inclusive growth and should not wait for permission from central government, I also think that we will not see substantial progress unless central government also understands that social investments, funded through general taxation, underpin economic inclusion, and very likely also underpin greater prosperity and stronger national economic performance.

The inclusive growth agenda has gathered momentum very quickly in Greater Manchester, especially since the Brexit vote, which so clearly reinforced the sense of discontent in the more economically marginalised parts of the conurbation. During the summer, the Greater Manchester Combined Authority (GMCA) appointed its first portfolio holder for Fairness, Equalities and Cohesion, Councillor Jean Stretton.  In November 2016 the IGAU and GMCA jointly convened a Fair Growth conference at which Councillor Stretton announced the intention for inclusive growth to be ‘embedded in all that we do’.  In May 2017, we will elect our first Mayor for Greater Manchester, with both leading candidates actively campaigning around inclusive growth issues.  The city will be an important test-bed for how inclusive growth can be put into practice at a local level. At the IGAU we look forward to being able to support these developments with rigorous research, evidence synthesis and monitoring.

Ruth’s blog is one of ten contributions in the new report ‘The State of the Debate 2017’ published by the All-Party Parliamentary Group on Inclusive Growth which is available to download here.