This week, the Eastern Powerhouse released the first State of the Region report for the East of England. The report details what is happening in our region and offers an insight into what could be done to grow the economy. It is important to note that the East is the fourth largest and highest performing regional economy in the UK, with a gross domestic product of £193bn per year, 8.5% of the UK’s GDP.
There are, however, worrying signs that the East has slipped relative to other regions and nations – with negative wage growth, falling vacancies, widening skill gaps, decreasing levels of Foreign Direct Investment, and an increasing trade deficit. The East is still dealing with the aftershock of unprecedented events including the Covid-19 pandemic and the war in Ukraine while adjusting to the post-Brexit settlement and new trade agreements, which have made the cost of doing business in the East more challenging. This is evidenced by fewer new enterprises and rising business closures. There are real risks that rather than being “Levelled Up” the East is falling behind.
Government spend per capita in the East is the second lowest in the United Kingdom. Yet, the report shows that the region has a unique combination of assets and knowledge-intensive industries, in life science, green energy, agritec and advanced manufacturing, which with the right level of investment will bring significant returns for the country as a whole. Whoever goes on to control parliament in the next election must bring forward regional policies that take advantage of the resources the East has to offer. In fact, it is time for a coherent regional strategy to connect important clusters of economic activity in our cities and towns and along our transport corridors. This will supercharge the East and distribute the benefits of growth more evenly across the region.
The East needs a regional spatial strategy, to align transport and housing plans over a 20-to-30-year period. Disconnected local plans have led to housing hot spots and the lack of high-quality public transport has exacerbated the problem. To maximise the potential of the Cambridge economy, we should be looking at a wider Silicon East. We must have an inclusive plan that takes advantage of the warehousing, manufacturing and distribution opportunities in Ipswich and Peterborough and maximises the science and technology brilliance in Norwich, Stevenage, and Cambridge. Our energy sector should be central to this plan and the east should lead the world in renewable energy innovation.
Rail routes must be improved, and housing delivered at existing and potential new railway stations. Rail travel between our major centres is too slow and hampers economy growth. Government commitment to upgrade Ely North and Haughley junctions is a start but not nearly enough. People in the east deserve the same investment into public transport as those in London, the current level of funding is unacceptable. Upgrades to the A47, A12 and A120 have been much discussed but never delivered. The current plan for the A47 is woefully short of expectation and need. This is a road that links the energy sector on the coast to the centre of the country, in any other region it would be a motorway, here it is not even a dual carriageway. In fact, there are just two sections of motorway in the east and none at all in Suffolk or Norfolk. We have the UKs largest port and the infrastructure that serves it is totally inadequate.
The Eastern Powerhouse is working on regional policies for energy and life science. We understand the needs of our business members and the opportunities that simply having a regional specific policy can offer. The State of the Region report offers both hope and a stark warning. Government has – in the East – a powerful economy with room to grow and become stronger. The winner of the next election should take heed of what the report says and deliver a plan for this incredible part of the country.
By James Palmer, Chair, Eastern Powerhouse