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MINUTES OF THE 50th MEETING OF
SOUTH EAST ENGLAND DEVELOPMENT AGENCY
HELD ON 16TH SEPTEMBER 2003 AT SEEDA HEADQUARTERS
Present
James Brathwaite CBE (Morning only) (Chairman)
Professor Sir Clive Booth (Deputy Chairman: chaired afternoon)
Elizabeth Brighouse
Barry Camfield (Morning only)
Robert Douglas
Cllr. Sarah Hohler
Cllr. Keith House
Janis Kong OBE
Mary McAnally
Terry Mills
John Peel
Dr Peter Read CBE
In Attendance
Anthony Dunnett (morning only) (SEEDA, Chief Executive)
Marianne Neville-Rolfe (Agency Secretary and Director, Strategy and Corporate
Services)
John Parsonage (SEEDA, Director, Learning and Skills)
Charlotte Dixon (SEEDA, Director, Economic Inclusion and Sustainability)
Jeff Alexander (SEEDA, Director, Business and International)
Paul Martin (item 9 only) (Regional Director, Government Office of the
South East)
Item 1 Welcome and Apologies for absence
Apologies were received from:-
Cllr. Ken Bodfish OBE (Deputy Chairman)
Poul Christensen
Paul Hudson (SEEDA, Director, Development and Infrastructure)
Item 2 Minutes of last meeting (16th July 2003)
Matters arising
- The minutes of the meeting held on 16th July 2003 were approved
as a correct record and signed by the Chairman. Charlotte Dixon
has received follow up papers from the Environment Agency as
promised, and will provide more information to Mary McAnally
regarding the possibility of increasing media coverage on the
state of the environment and its implications for business.
- Action items were reported as in hand. The Chairman has
spoken on the phone with Tony McNulty, Parliamentary Under
Secretary Department for Transport, to discuss options available
following the disappointing decisions on the South Coast Multi-Modal
Study (SoCoMMS). A meeting has been convened for 15th October
that will also involve the Regional Assembly and GOSE so that
alternatives for the A27 improvements can be considered. The
Highways Agency is being asked to review that and other priorities,
including Junction 10A on the M20 for Ashford. Members agreed
that although progress so far was encouraging, it was important
for all parties concerned to maintain the pressure.
- A meeting of Board members on LSC Councils would take place
later in the day. Succession planning was under consideration
and suggestions would be presented shortly. Discussions on
the National Skills Strategy would be used as the basis for
a conference later this year.
- There has been ongoing debate between the RDAs and the Dti
on the frequency of future MORI surveys, with the likely outcome
being every 2 years. This provides a clear timeframe for taking
forward the issues raised, and also gives an opportunity for
feedback from specific stakeholder groups in the intervening
years. Members suggested this could induce survey fatigue,
but suggested the possibility of 'piggy-backing' on
other surveys such as those conducted by Local Authorities.
Marianne Neville-Rolfe will include options in her action paper
that will be presented to the Board.
- Paul Hudson's paper on regeneration and economic development
will be brought to the Board in March 2004, with an interim
paper next month on capital rationing. Charlotte Dixon will
liaise with Paul Hudson to identify how successful SEEDA's
economic regeneration programme has been in the 119 wards.
The effect of the revision of the Index of Multiple Deprivation
on any region was very difficult to evaluate.
- An interactive project portfolio was demonstrated to members.
This has arisen partly in response to the expressed wishes
of elected members to have instant access to information on
SEEDA's interventions in their areas and will be displayed
at the SEEDA receptions at the party conferences. Hard copy
packs of the project portfolios were distributed to members.
ACTION
Marianne Neville-Rolfe and Charlotte Dixon assess likely effects of revised
IMD, including possible changes to funding.
Item 3 Declarations of Interest
- John Peel declared an interest in items 5.4 and 5.5 through
his connection with Wired Sussex
- Jim Brathwaite declared an interest in items 5.4 and 5.5
through past connections with Wired Sussex
- Mary McAnally, as a member of the referee panel for the
energy industry, declared an interest in item 10.2. She also
declared an interest in item 5.4 through her position with
Sport England.
Item 4 Chairman's Report
- The Chairman reported that interviews had taken place for
the new Board Members. All members were asked to consider encouraging
suitable future candidates from amongst their own networks,
particularly with regard to diversity and gender. SEEDA could
consider following Dti's example and running outreach
programmes.
- The Chairman had held useful meetings with the Deputy Prime
Minister, firstly at Ashford with Kent County Council and selected
architects, and secondly in Hastings. The DPM had been very
impressed by his visit to Hastings and the way in which his
Department's funds were being spent.
- The Chairman reported on his discussions with Anna Walker,
a senior civil servant in DEFRA, particularly in relation to
ongoing discussions between SEEDA and the Department on horticultural
research.
- The Chairman informed members that he and the Chief Executive
were about to depart for a visit to global region partners
in the Far East and Australia and would be visiting the US
and Canada in November. Peter Read expressed concern that individual
RDA's activities in distant parts of the globe could
be seen as counter-productive to the national inward investment
interest. The Chief Executive stated that the Dti and Foreign
Office had concluded that RDAs were working co-operatively
and had approved SEEDA's establishment of overseas agents.
- SEEDA does not have overseas premises, but works closely
with the FCO Posts to build relationships with government offices,
and with other institutions where the Post may be unable to
do so. SEEDA's global regions project focuses on increasing
2-way trade and developing educational links to explore best
practice in economic development rather than in straight inward
investment. The Ambassadors responsible for inward investment
in those areas where we operate are supportive of SEEDA's
approach. John Peel asked for clarification on the value for
money from the investment in global regions. The Chairman agreed
to report back to the Board following his complete round of
trips with information on how other regions are driving their
economic strategies and to give an indication of cost - benefit.
- Members were supportive of the policy, but welcomed the
prospect of a fuller debate that would include the potential
for developing closer links with Europe.
ACTION:
Jeff Alexander to prepare paper with the Chairman for consideration at
December Board meeting
Item 5 Chief Executive's Report
General Report
- Members noted the Chief Executive's General Report.
Anthony Dunnett reported that SEEDA had received an'excellent' rating
from the Government Office for its performance, and was the
only RDA to be so rated. The financial benefit from the distribution
of the RDA performance fund has yet to be determined by Dti.
- The Chief Executive reported that a very productive seminar
had recently been held with top international business schools
to develop a framework for the proposed International Institute
of Innovation and Entrepreneurship. The business plan was now
being prepared, and would be the subject of a board paper in
December, linking closely to the global regions paper promised
by the Chairman.
- Referring to paragraphs 4-6 in the general report, on the
sustainable communities fund, he reported that ODPM were still
deciding on the appropriate routing of funds but it was likely
to be through either SEEDA or the County Council as accountable
bodies in Thames Gateway and Ashford, and English Partnerships
for Milton Keynes. Consultants have been appointed to advise
the Department.
- Members' attention was drawn to the fact that an Order
has been passed in Parliament making RDAs statutory consultees
in the planning process for certain categories of planning
application. SEEDA will only seek to be consulted on applications
with a strategic importance, but members must be aware that
this would require them to exercise care in any involvement
with planning cases in the future. The Board will be asked
at a future meeting when Paul Hudson is present to advise on
how big a role they would envisage for SEEDA in the planning
process. It is for the Board to determine what constitutes
strategic decisions and how conflicts of interest should be
resolved if SEEDA is supporting certain applications.
- Members welcomed the new responsibilities as planning has
significant impact on economic development. Reservations were
expressed that this could be seen as an additional layer of
bureaucracy, but a clearly justified statement from the RDA
could reduce the likelihood of contentious applications being
called in by the Government Office.
- Referring to the item within the general report on Enterprise
Hubs and Gateways, Peter Read requested information on the
ongoing appraisal process for the project. Jeff Alexander reported
that Hubs report quarterly against targets and are reviewed
annually by the SEEDA Hub team. The first group of Hubs are
approaching a full 3 year review that will be conducted by
the performance management team. He agreed to submit a summary
report to the Board when the review was complete.
- Members expressed concern that SEEDA was setting up a number
of subsidiaries, the latest being the Regional Aggregation
Board, and asked whether there was sufficient capability to
deal with the private sector. The Chief Executive assured members
that subsidiaries were only considered when absolutely necessary;
that the necessary capability existed and that the IoD is going
to undertake specific training of staff who will be board members
of subsidiary companies.
ACTION
Paul Hudson to prepare guidance paper for Board members on SEEDA's
new planning role.
Jeff Alexander to provide summary on Enterprise Hub 3 year appraisal
to the Board
Board meetings: forward programme
- Members noted the programme for 2004, and were asked to
advise the Executive if there were any arising issues that
should be included in the agenda.
Project Report
- The Board reviewed, noted and approved various SEEDA programme
investments. The Board approved the increase in expenditure
on the Ropetackle project at Shoreham.
ACTION:
Paul Hudson to bring capital rationing paper to October Board meeting
and thereafter submit a quarterly report to the MPC.
Regional Broadband Aggregation
- The Chief Executive outlined the current situation pertaining
to regional broadband aggregation. This has been the subject
of previous discussion by the Board. If RDAs are not convinced
there is an effective business case for these companies by
the end of 2003, they can terminate any agreements with all
costs to date borne by the Department. SEEDA, as a partner
in the South East Board, would seek to parallel contract for
the private sector with the public sector to enable social
enterprises and dislocated small businesses to benefit from
wider access to suppliers' markets. It is a precondition
for RDA co-operation with Dti, that the Department overcomes
any state aid or other problems associated with this approach
so that the benefits of aggregation are not solely confined
to the public sector.
- The Board approved:
- SEEDA's participation as a Partner in the establishment
of a limited liability partnership company (the South
East Regional Aggregation Body);
- the policy for SEEDA's investment in the company
to be by the form of a loan, to be repaid through operating
returns;
- to delegate to the Chief Executive the agreement of
the Constitution of the Company, and the terms of the
Loan Agreement;
- that at the request of, and on behalf of, the RDAs
(in its role as lead RDA) SEEDA will undertake one consolidated
appraisal of the 9 RABs and obtain the approval for the
RABs from Dti.
Item 6 Basic Skills
- Barbara Bicknell, SEEDA Head of Basic Skills and Access
to Learning, presented her paper. The statistics from the Basic
Skills Agency for the region date from 1999, but there has
been minimal change since then. Census data is mapping the
current situation. SEEDA's Basic Skills Strategy preceded
that of the Basic Skills Agency and the setting up of the LSCs.
SEEDA's policy has been to fill a gap in provision of
basic skills, and to address the needs of the 15% of the workforce
who lack basic literacy and numeracy by providing tuition in
the workplace, working with employers. Employers' surveys
reveal that only 4% of jobs can be done by people lacking basic
skills. SEEDA is the most successful RDA in addressing basic
skills.
- The basic skills programme has expanded considerably since
its inception three years ago, so it is timely to review it.
The aim is to embed basic skills into all access to learning
routes and not just through specific projects. Although 11,654
people undertook basic skills training in the workplace in
2002/03 through SEEDA projects, there are around 1 million
people who need these skills. SEEDA is expecting to be a partner
with the NHS University to increase its impact. SEEDA's
role is increasingly to set policy and leave others, especially
the TUC and LSCs, to deliver.
- Funding allocation to the region is such that even though
SEEDA funding is relatively small, if it is withdrawn from
project delivery, it will represent an overall loss as the
LSCs will be unlikely to be able to make it up. The TUC has
a role in making employers accept the problem, and to assess
the need amongst employees.
- The Board congratulated Barbara on what she has achieved
with small resources, and endorsed her proposed approach to
taking the programme forward.
Item 7 Operational Review
Finance Report
- The Finance Report was noted. Members asked for comparative
data on amounts as well as percentages of expenditure for previous
years to be supplied and this was agreed.
Management Statement and Financial Memorandum.
- The Board noted the changes to the Management Statement
and the Financial Memorandum.
- The Board requested the Audit Committee to review the changes
and to advise the Board on its implications and any actions
required to ensure compliance. The Audit Committee was asked
to consider in this context the Agency's compliance with
the Higgs Code of Corporate Governance, in particular the respective
responsibilities of the Chairman and Chief Executive.
Approval of Annual Accounts
- John Peel moved the motion that the Board formally approve
the annual accounts. This was seconded by Rob Douglas and agreed
by all members.
Item 8 Economic Outlook: presentation by Stuart Iles,
Bank of England Regional Agent
- Stuart Iles presentation was circulated at the meeting.
He concentrated on the world economy, with some reference to
the regional economy. There is little evidence of economic
recovery in Euroland, with Italy, Germany, France and Holland
experiencing negative growth. There is some recovery of confidence
in the UK economy with better growth in quarter 2 than quarter
1. The US economy is expected to recover in 2004 although unemployment
rates are rising because of strong growth in productivity which
restrains hiring but will also constrain consumption. The Far
East is looking promising, in spite of SARS, and there have
been 5 or 6 quarters of consecutive growth in Japan. The concensus
is that sterling exchange rates against the dollar and euro
will be stable for the next two years.
- Public expenditure is driving the UK economy, with only
a slow improvement expected in the negative net trade balance.
The regional story is similar to the national picture. Debt
is overcoming the decrease in post tax income, and house price
inflation is expected to be zero within the next two years.
- Business investment - usually 15 - 20% GDP - is remaining
weak which is in part due to the slowdown in IT and the knock
on effect on the construction industry from the over supply
of business premises in areas such as the Thames Valley.
- Bank of England policy is unlikely to change. The Chancellor's
November statement will revise targets to relate to the European
index which has a different basis from the UK Retail Price
Index.
- There is a shortage of accurate and current regional data,
apart from some labour market data. It is not possible to alter
the Bank's forecasts from a regional perspective or from
regional interventions. The higher than average increase in
public sector earnings, coupled with stabilization of housing
inflation may make it a bit easier to get key workers housed,
especially if the current house price to earnings ratio of
over 6 (comparable to the 1989 ratio) has peaked.
Item 9 GOSE Regional Director's Report
- Paul Martin reported on four main items: the GO sponsorship
role; the regional housing strategy; planning; and transport.
He confirmed that SEEDA had been performance rated as excellent
and congratulated the Agency on an outstanding year. There
were some criticisms and weaknesses but these can be easily
addressed. He will be sharing the highlights of the review
with the Regional Assembly. He also confirmed that Dti will
announce the three new Board members in the first half of October.
- The first Regional Housing Strategy was delivered to Ministers
at the end of July. Paul Hudson and Keith House were closely
involved in drawing up the strategy. All concerned were keen
to ensure some degree of continuity and stability in the system
at a time of turbulence, and to achieve a balance between the
growth areas and other parts of the region. Ministers will
allocate resources for affordable housing for London, and the
East and South East regions given the related nature of their
housing markets. An announcement is expected next month. Members
requested an update on the RHS early in the next round of development
in the spring, especially relating to barriers to housing development.
- Improvements in local authority planning performance is
a key priority for the Government Office. The weakest will
be identified, supported to improve, and monitored. The housing
market in London and the South East is one of the Prime Minister's
top priorities so Number 10 is working closely with the GO.
Paul Martin suggested that Michael Barber or Kieran Brett from
the Prime Minister's Delivery Unit could give the Board
an interesting perspective on planning. The key issue for government
is delivery of RPG numbers, with local authorities now responsible
not only for determining planning applications but also for
ensuring houses are delivered to market.
- Paul Martin reported on the Chairman's effective representation
of regional interests in Whitehall, with his support for the
Regional Assembly and Local Authorities in taking forward the
transport priorities rejected from the South Coast Multi Modal
Study. Following yesterday's telephone call to the Minister,
there is some hope that Highways Agency is now looking at other
options on routes. Ministers are certainly aware of the strength
of feeling in the region and on the impact of transport on
regional economic performance.
Item 10 Environment, Economic Inclusion and Sustainability
Division
Update on activities
- Charlotte Dixon presented an update on her division's
activities, focusing on AIFs. A summary of what AIFs are, and
what they are not, was circulated to members. 10 AIFs are in
preparation for completion by December, identifying the vision,
priorities and action plans of their sub-regions, working closely
with the area teams. The important message is that AIFs are
not a simple replacement for SRB funding, but a strategic framework
that influences the spending decisions of all funders, not
just SEEDA. This approach is supported by other funders. SEEDA
is not a mainstream funder but a catalyst for change. Getting
this across to partnerships who are accustomed to bidding rounds
is a challenging communications exercise
- A detailed paper for a social enterprise strategy will come
to the Board in December, following analysis of the recently
completed research. It will have two strands: CDFI and the
development of a social enterprise agency. This Agency will
provide support services and drive forward policy, disseminate
best practice and influence Ministers. The research has revealed
that there are a great many more social enterprises than is
generally supposed. Liz Brighouse said that Barbara Phillips
from Dti would like to attend the relevant Board committee.
She also said that SEEDA needed to be clearer about its activities
and to insist that recipients of SEEDA funding acknowledge
it properly in their literature.
- Charlotte Dixon said that she would be presenting a paper
on Corporate Social Responsibility to the December Board meeting.
Energy
- The paper presented by Graham Tubb anticipated a broader
discussion on energy policy at a future date. The energy white
paper covers a 20-30 year timescale and looks at climate change
and the impact of the UK changing from being a net exporter
of oil and gas to being a net importer. The White Paper accepts
that nuclear energy has a role to play in a secure mix of energy
sources but the economics of nuclear energy, and the Government's
reluctance to accept 'lender of last resort' costs,
do not encourage investment in nuclear at this stage although
the skills required will be maintained. A reconfigured transmission
structure would include a wider renewable energy programme
with more local generation.
- Members expressed their reservations about the paper as
presented and requested a fuller debate following an expert
presentation, possibly from an official at the Dti. Members
were divided on the issue of nuclear energy and postponed reaching
any decisons. They questioned why the nuclear option was viable
in France, but apparently uneconomic in the UK, and warned
against undue influence being exerted by environmental pressure
groups.
- The Chairman had met the energy company EDF at which a potential
shortfall in power supply to the region this winter was suggested
as a possibility. The Chairman has written to the Energy Minister,
Stephen Timms, asking him to look into the whole question of
electricity generation, including nuclear energy, for and in
the South East. Generation at remote locations incurs large
transmission losses. The Board wish to be part of an informed
debate to secure the region's future energy supply. There
is considerable research expertise in this region that could
inform the debate.
ACTION:
Secretariat to schedule guest expert speaker into 2004 programme.
Market towns:
- Valerie Carter updated the Board on the developing policy
from the RES on support for market towns. The Board noted the
paper and approved the development of the detailed policy determining
the Agency's support for rural towns as outlined in the
Corporate Plan and Regional Economic Plan previously approved
by the Board.
- This is a long term programme running over a 7 year time
frame with a review after year 4. A shorter time scale does
not work. Many towns will want to concentrate on securing a
major project ((£80-100K, half funded by SEEDA with matched
funding) which will have significant impact on their revival,
but there will be a few who will require a greater investment
of around £500K (£240K from SEEDA)as in the first
round of support for market towns.
- A health check process remains an essential precursor for
any SEEDA support: this ensures town partnerships come together
and prevent pressure group domination. Communities that get
SEEDA support should acknowledge and publicise it appropriately.
- A second strand of the policy is to support regional networks
with coordinators in town partnerships linking to broadband
advisors and other county based partnerships. Other agencies
including Sport England and the National Lottery are represented
on the regional rural towns partnership, ensuring complementary
activity rather than duplication. SEEDA's approach is
being copied by other RDAs. There are plenty of good news stories
from this policy which is an excellent example of a region
wide programme. The rural board committee has been heavily
involved in the development of the revised approach which will
be launched in the new year.
Item 11 AOB
- No items were raised.
Item 12 Date of Next Meeting
- The next meeting of the SEEDA Board will be on 22nd October
at Ashford International Hotel, following the Annual Open Meeting.
Registration for the Open Meeting is at 10.30 for11. The Board
meeting will commence at 2pm.
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