Economic development and regeneration has always been a key priority for local and national government alike, but in the current economic climate in the wake of the recession, successful economic regeneration is more important than ever.
Whilst local government undertakes specific activities around promoting and supporting economic development, its collective functions and services have a significant impact on the local economy; it commissions a wide range of services including from local businesses, it manages the planning system and large parts of the transport infrastructure, and also is the largest employer in any locality – employing over 160,000 people across Wales, people whose wages support the local economy.
The role of local authorities
Local authorities help deliver economic development and improved prosperity to local areas. They do this in partnership with other key players such as communities, the third sector and the private sector. They are also increasingly working with other local authorities within a wider geographical area, be it within specific Regeneration Area programmes such as the Heads of the Valleys and the Môn a Menai initiatives, other sub-regional and regional arrangements, and on a spatial level through the Wales Spatial Plan. They are also playing a key role in delivering European Structural Fund projects across Wales, many in collaboration with neighbouring local authorities and other partners at a sub-regional and regional level.
The Welsh Government published its new approach to Economic Development in July 2010 under the heading Economic Renewal: A New Direction. This outlines a new strategy of reducing direct business support grants to companies and increasing investment on creating a better environment for businesses to flourish by transferring funds to ICT and Transport Infrastructure. It also sets out a sectoral approach for supporting businesses with priority given to six key sectors. The current Welsh Government has adopted this approach and added a further three sectors to their key priority sectors list. They have also announced the development of 7 Enterprise Zones across Wales, to be operational from the 1st of April 2012.
Notwithstanding the significant macro-economic challenges faced as a result of the global financial crisis and subsequent recessions, important local and national challenges are:
- raising employment levels
- reducing rates of economic inactivity
- raising gross domestic product (GDP) across Wales
- increasing the skills base of the workforce
- increasing levels of research and development and innovation
- regenerating the most deprived communities
- ensuring that economic prosperity is spread across Wales
Key facts
Wales continues to be amongst the poorest regions of the United Kingdom, and the European Union, measured by Gross Domestic Product per head and household income.
- The Employment rate in Wales is currently 68.2% compared to a UK rate of 70.3%.
- Wales has the lowest Gross Value Added (GVA) per head of population in the UK
- West Wales and the Valleys is amongst the bottom five NUTS 2 areas in the UK with the lowest disposable household income after tax
- Around £3 billion of funds are available to Wales through the European Structural Funds Programmes and match funding from 2007-2013
- The Communities First programme supports over 100 of the most disadvantaged wards in Wales.
Further Information