My thesis in this blog post is that the main thing that is holding back this city is lack of resources, across a number of investment agendas, and the city needs to take the initiative. Does the city and the LEP lack imagination, possibly in part, they have not got triple helix approaches to innovation sewn up, they are unimaginative in other areas and leading in yet other areas. But the City could learn quickly if it had the resources. The city had huge amounts in the 60’s and 70’s but largely invested them wastefully in poor quality housing and too many road schemes but now when the collective expertise on how you turn round urban areas is so much more advanced there is precious little resource to go round. Albert Bore in his recent Guardian article whilst pointing out that the coalition Government had got it right on devolution of powers and resources under the City Deal agenda pointed to this being completely undermined by Local Authority cuts. The City is broke when it comes to finding monies for the status quo let alone new initiatives.
Now it is not as if the City was coasting successfully. There are some real pluses in the pipeline, the New Library, New Street Station, the Airport extension, and the Metro extension are the key ones. However the city has to change dramatically in the next few years if we are to meet the huge challenges of unemployment and poverty, climate change and energy and the need for economic growth. I want to focus on one area to discuss what we can do about accessing the money necessary. I want to focus on transport.
Birmingham City Council’s motto is Forward. The City that in the 20th century planned voraciously for the accommodation of the car has lost its way recently; is behind the curve led by other cities in the UK let alone in Europe and needs to wake up. We have really got to move forward on transportation. We need to radically change the way we travel and improve public transport hugely if we are to meet climate change targets, maintain and grow the economy and include a wider proportion of our community in active life. So justify myself…..money!
The LEP and the Council are putting much of their hope in the single pot put forward by Lord Heseltine. There has been much talk about the importance of this in terms of devolving decision making on funding to local level. I couldn’t agree more…but despite the localism language of parts of this Government there is still hardly a day goes by without news of another bid put forward by the City Council, some for significant resources like the current £17m cycling bid (City Ambition Fund), others for trivial sums like the Cycle Safety Grants (download here) where the City recently won a few thousand pounds. There are a whole host of different pots for different types of transport related funding, Pinch Point funding, Local Infrastructure Fund, Local Sustainable Transport Fund, Growing Places……… I don’t profess to know them all. What is key and seems to be agreed by Government is that this whole bidding circus needs to stop. It is wasteful of resources centrally and locally. How much for instance will we have spent on preparing the current Cycling bid and raising peoples hopes…what happens if as has sometimes been the case..we don’t get what we want.
The proposed single budget has been put at a pot of up to £70bn but also as low as a few billion. I thought it might be useful to scope what this could mean for the LEP. If there is a budget nationally of £10bn annually based on population share we might expect to access circa £300m. That is significant monies and is is vitally important that the pressure is kept up to get this established. There are some risks to it however…..it is promised in 2015 – election year which potentially throws it into doubt; it will need to be spent on a wide range of different investments including transport, there will undoubtedly be a fightback from Civil Servants and some politicians to maintain central silos; austerity and cuts are with us for years and this would be a target and lastly it is far from clear for how along ahead it will be promised. A recent BIS Select Committee Report on LEP’s (download here) argued for a five year timespan for the commitment to allow for proper planning. It is to be hoped that this will be accepted by Government. So this proposed budget is really important but I don’t think it negates what I have to say below. Deep down although this process promises autonomy we will seemingly still have to bid for a pot as the control still lies centrally. So in my view this pot is necessary but not sufficient to really undertake the radical investment we need. It is placing all our eggs in one basket; a basket we do not yet have.
This country is overly centralised compared to most large modern economies and we have been reliant on central resources to fund most significant investments but with the Enterprise Zone (EZ) a small crack in this facade has occurred. What is brilliant about the EZ approach is not the benefits to business, which only last until 2015 but it is the fact that the LEP will keep any business rate uprating for 25 years. Fantastic a revenue stream against which the LEPs or LA’s can borrow; as Birmingham City Council is planning to do. This was introduced after years of lobbying by Core Cities who introduced the concept of Tax Incremental Financing to Whitehall.
So my main thesis is we need to find other ways to raise resources; other ways to get revenue streams to invest in the long term transportation infrastructure we need. And what do we need. Well take a look at Centro’s Towards an Integrated World Class Transport system (download here). This shows some ambition, it compares the West Midlands with other European metropolitan areas, talks about best practice and introduces carbon reduction targets but crucially is tempered by being grounded in the current model. This report is seven years after a similar report in 2007. I would dearly love to look to see how much of that 2007 plan has been delivered but haven’t the time. A recent paper however from Centro illustrates the current problem. This report shows current and future planned infrastructure schemes in the Centro area (download here)
It indicates what the DoT has estimated will be allocated to the West Midands;
So for four years Birmingham and Solihull will have approximately £9m per year to fund Strategic Public Transport schemes. The report then outlines in brief the rigmarole that project promoters have to jump through to get these funds. Does this seem a budget that will radically change the City; will it lead to a step change in public transport. The answer is patently no. So really important schemes are pushed backwards. For instance the opening of the ex passenger line through Kings Heath and Moseley which if I remember rightly could take a million journeys of the road each year, and which was seriously raised possibly four years ago is now pushed back to post 2019 which in reality means delivery by the mid 2020’s. Possibly 20 years to deliver. There aren’t enough resources being allocated to schemes and there is not enough urgency.
So now this is where I start to get controversial. I think we need to look at ways in which transportation can generate resources for itself. Two such approaches which are successfully working elsewhere are congestion charging and an employers car parking levy.. Now I hear howls of we can’t afford this, it will harm the economy etc…but we have to ask where else can we get the money from. The Greater Birmingham and Solihull LEP area has a GVA of circa £34bn…and are people saying we cannot afford a small proportion of this to help us to be even more economically efficient and productive; to help tackle our transportation problems. It doesn’t make sense. These are two possible ways to raise resources – are there others?
As the LEP itself says ‘We must seek new ways to address old problems – we must be transformational.’
Lets look at these two areas one at a time. Outside London congestion charging has stalled in the UK… but not on the continent. There are a growing number of cities in Europe that have introduced this including Stockholm, Oslo and Gothenburg. Now a congestion charging zone is not solely introduced to raise funds, it seeks to tackle issues of congestion, greenhouse gas emissions, air quality etc. It also seeks to try and ensure a more economic use of our limited road space. Anyone who has visited London in recent years and who remembers it of old can notice the huge improvements in public transport; in cycling and walking. This in part is down to the congestion charge. Now Greater Manchester did try and persuade its public to vote for such a scheme a few years ago and it failed. I have used this video before but I like the approach taken in Stockholm in persuading its population to vote for congestion charging.
Another approach is to introduce a workplace car parking charge. Nottingham has gone it alone in the UK. Now I originated from this fine city and as long as I can remember Nottingham has experimented with measures to promote public transport. I grew up when they were trying the bus collar which controlled access to the City Centre for car born transport. They introduced work place car parking levy in 2011 on all employers with over 10 car parking spaces. It is early days but it is forecast that the scheme will bring in £14m per year over 25 years. The monies raised are only spent on public transportation; they are going to part fund the two new tramlines due to open in 2014. It will also help fund a reworking of their railway station and will invest in green buses as well as other initiatives.
These slides give you a feel for its possible impact (download here)
Both of these schemes have pluses and minuses and they would need serious consideration so I would suggest a Transport Commission to look into this but they would give the City a revenue flow that could, as with the EZ monies, be borrowed against to really give a kick start to a radical transformation in the way the City travels.
Will Birmingham be up for such radical funding approaches. I must admit I think it unlikely as with the Nottingham case it would need a lot of selling i.e. leadership and the Council would take a lot of flak. I believe the Council does want radical transportation change but hasn’t yet thought out exactly how to deliver it. Is it political sellable? That is really the big question. Birmingham City Council is trying to introduce wheelie bins currently; a relatively small decision, taken by most authorities over 20 years ago but this has caused a lot of hot air and barely a Council meeting seems to go by without it raising its head. So if wheelie bins are controversial the ideas above stand no chance. Well no chance unless an open, deep and ongoing conversation with the public about the necessity to find such resources and the implications for us in the city, for its economy, for the environment, in a period of rising fuel prices if we do not is started. The Council is going to produce an Urban Mobility Action Plan later this year as part of delivering on the Green Commission’s agenda; lets see if that conversation starts with its publication.