Regional economic development, inclusive growth and child poverty in Scotland

Crisp et al. (2014, p.1)[1]

2.1 Introduction

A plethora of variously related terms and a confusing range of policies and institutions surround any analysis of regional and local economic regeneration partnerships and child poverty. To fully understand the views reported in Chapters 3 and 4, it is important to consider some key terms and try to clarify the policy and institutional context. This Chapter draws upon published sources and insights gathered from interviews with experts to outline the theoretical and policy background to the work of Regional Economic Partnerships (REPs) in Scotland as these relate to child poverty[2]. This overview is not based on a formal systematic review (i.e., an exhaustive search of databases using standardised selection procedures)[3], nor does it seek to present a comprehensive account of the economic regeneration literature. There is an abundance of information on and assessment of economic regeneration policy (including international experience), and it is not the intention here to repeat this[4]. What follows is intended to contextualise the work of REPs in Scotland and consider how this relates to main key concepts, approaches, and debates in the field.

2.2 Research and policy on inclusive growth, regional economic development and child poverty

2.2.1 Theoretical background: ‘inclusive growth’ and related ideas

Several different terms and concepts are used to refer to regional and local economic regeneration, and there is a long tradition of different approaches and initiatives in the UK and Scotland, dating back to at least slum clearance programmes in the early part of the 20th century, if not before[5]. It is not possible here to cover all of these ideas and actions but considering a few key terms and flagship policies is helpful in establishing the context for the work of REPs in Scotland. Among the ideas which arise in this context (and which the case study interviews mentioned) are ‘inclusive growth’, ‘levelling up’, ‘wellbeing economy’, community wealth building (CWB) and the ‘foundational economy’. Among the relevant policies to note are City Growth Deals, Freeports/Greenports, and the Shared Prosperity Fund.

An important distinction to consider in any analysis of economic regeneration policy is whether actions are addressed towards places (i.e., regions or local areas) or particular groups of people in places. It is possible for a regeneration policy to improve conditions in a locality without necessarily benefitting residents of that place, or other particularly disadvantaged groups, e.g., if regeneration leads to gentrification or displacement of lower income households, or new economic opportunities are taken up by those outwith the locality. It is also possible that the incomes of the poorest households within a locality might increase but do so at a lower rate than other groups so that inequality or relative poverty rises. Some economic activity indicators used to measure impact (such as regional Gross Value Added - GVA) do not adequately capture the beneficiaries of any changes[6]. Some commentators have criticised recent regional economic regeneration policies for being unclear about ‘whether the government wants to target inequalities between people or places’[7]. This distinction between places and people is not absolute, but it is important to be aware of the potentially variable impact on child poverty of different approaches to regeneration. This is one reason for the recent interest in ideas of inclusive growth.

2.2.1.1. Inclusive growth

The attention given to inclusive growth (IG) is part of a general trend in economic thinking developed in response to the fiscal crisis and recession of 2008 and a wider critique of neoliberal theory and policy[8]. The underlying principles of IG have a long history, but the concept has been particularly prominent in Scotland since 2015 when the Scottish Government declared it as its central economic objective[9]. It has been noted that ‘inclusive growth means many different things to different people… it is blurrily defined and inconsistently understood [and there are] … few clear examples of what inclusive growth looks like in practice’[10]. Despite this the basic characteristics of IG are clear: it is concerned with understanding both who benefits from economic activity and how, in order to identify ‘whether we can do more to spread the benefits to those most in need?’[11]. The Scottish Government defines IG as ‘Growth that combines increased prosperity with greater equity; that creates opportunities for all and distributes the dividends of increased prosperity fairly’[12]. This definition resembles that of the OECD[13], the Joseph Rowntree Foundation[14], and the Royal Society of Arts Inclusive Growth Commission[15]. It has been observed the IG relates in some respects to ideas of a wellbeing economy[16].

Proponents of IG argued that it should not be assumed that economic growth per se results in greater inclusion[17]. They argue that a genuinely inclusive approach to economic policy and regeneration involves considering the distributional effects of economic policy in advance rather than intervening and redistributing resources after the fact[18]. Therefore, effective IG policies take a preventative approach[19], and consider the effect of economic policies upon equality, in line with the principles and stipulations of the Fairer Scotland Duty[20]. Another postulate of IG is that economic growth and equality are complementary rather than competing concerns. For example, the Advisory Group on Economic Recovery reiterates the view of the Scottish Government that ‘strong sustainable economy goes hand in hand with a fair and equal society’[21], and argued that ‘There is growing evidence that delivering sustainable growth and addressing longstanding inequalities are reinforcing - and not competing - objectives… the IMF notes that tackling inequality is not only a social imperative; it is critical for sustaining growth’[22].

However, despite such consensus and widespread enthusiasm, doubts remain about how IG can be operationalised and applied in practice. Research conducted by Institute for Public Policy Research in Scotland found that ‘the further you move from central government to local areas, or from the senior level to the practitioner level, the more confusion there is surrounding what inclusive growth is, and what it is trying to achieve’[23]. This confusion is compounded by several seemingly similar and contested ideas and policies.

2.2.1.2. Levelling up and shared prosperity

The UK Government’s promotion of a ‘levelling up’ approach to regional economic and regeneration policy has been criticised as ‘nebulous’. The relationship of levelling up to IG and other concepts is difficult to determine definitively[24]. The UK Treasury report Build Back Better: Our Plan for Growth described levelling up as a new economic approach to tackling regional inequality concerned with ‘improving everyday life for people in those [so-called ‘left-behind’] places’[25]. Irrespective of any conceptual ambiguities, levelling up is an important policy area[26]. The UK Government’s Levelling Up Fund is a significant source for investment in capital projects and large infrastructure developments, and over £170 million was provided to authorities in Scotland from the first round of the Levelling Up Fund in 2020[27]. A second round of funding was announced in March 2022. This will provide £4.8 billion across the UK as a whole to 2024.

A separate but closely related term and policy activity is the UK Government’s Shared Prosperity Fund, launched in April 2022. The stated purpose of the Fund is ‘levelling up opportunity and prosperity and overcoming deep-seated geographical inequalities’[28], and is intended to replace EU Structural and Social Funding. The intention is to achieve the desired outcomes through measures which will ‘build pride in place and increase life chances, boost productivity, pay, jobs and living standards’[29]. Local authorities are responsible for leading applications for Shared Prosperity Funding, and encouraged to form regional partnerships and shared Local Investment Plans to do so. The UK Government’s guidance on the Fund describes City and Growth Deals in Scotland (and also Wales) as ‘strong examples of collaboration’, indicating that the Fund will relate in some respects to existing REPs. One distinctive feature of the Shared Prosperity Fund is the stipulations that local Members of the UK Parliament ‘should be closely engaged in the design and delivery of the Fund’, and that ‘local authorities [should] report individual project outputs and outcomes at UK Parliament constituency level’.

2.2.1.3. Foundational economy

A final idea relevant to understanding the context of economic regeneration and child poverty in Scotland is the foundational economy (FE). This refers to what has been described as essential products and services that keep residents ‘safe, sound, and civilised’[30], which are vital to maintaining wellbeing and impact most directly upon quality of life. Examples of the FE sectors include education, health and social care provision, basic utilities, retail, and transport. The FE overlaps significantly with the services provided by the ‘key workers’ who kept the economy running during Covid. Among its other features - which can involve radical visions of alternative economic models[31] - the idea of an FE highlights areas which are particularly important sources of female employment and which are forecast to expand in Scotland[32]. However, it is more challenging to measure productivity in FE sectors, and its contribution to conventional measures of prosperity and growth are often underestimated. Nevertheless, some important features of the FE overlap or are compatible with ideas of inclusive growth, the wellbeing economy and more progressive forms of regional and local economic development and regeneration.

2.2.2. Regional economic policy in the UK and Scotland

2.2.2.1. Policy background

There have been several phases of economic development and regeneration policy in the UK in the post-WW2 era, each characterised by distinctive approaches. In many cases, reducing poverty was at best an implicit objective of many of these measures; however, it has not always been clear how this outcome was expected to be achieved nor what specific actions were taken to accomplish it.

Following the Town & Country Planning Act 1947 and the creation of New Towns, the first significant regional and local economic regeneration policy in the UK were the Community Development Programmes (CDPs) developed in the 1960s[33]. These were the first in what came to be known as area-based initiatives (ABIs) which target support towards particular deprived (usually urban) neighbourhoods for a fixed time period. CDPs were modelled on programmes developed as part of the ‘War on Poverty’ launched in the USA by President Johnson. The British CDPs initially focused on addressing what were regarded by the UK Government as the causes of the ‘cycle of deprivation’ which ‘transmitted’ deprivation over generations. However, in practice, this understanding of the causes of local economic decline and disadvantage was rejected by many of those responsible for implementing the Programmes, who advocated instead structural reforms to patterns of investment, changing employment conditions and supporting community empowerment[34].

Following a range of similar ABIs in the 1970s - such as the Glasgow Eastern Area Renewal programme[35] - a different approach to regional economic development and regeneration was introduced by the Conservative governments in the 1980s. This focussed on leveraging private sector resources to rebuild and renew areas of economic decline and potential development. Examples of such programmes include Urban Development Corporations and Enterprise Zones (EZs). The latter are seeing something of a revival in the creation of Freeports (and the corresponding Green Freeports in Scotland[36]). Enterprise Zones exemplified the market-oriented approach to local economic development favoured by the 1980s Conservative UK Governments. The principle underlying idea was to stimulate job creation by providing various incentives (in the form of tax rebates) and exemptions (deregulation) in localities considered to have the potential to attract private investment. The motivating belief was that freeing up enterprise and making land and infrastructure more attractive to the private sector is essential to ‘creating a more entrepreneurial culture in areas deemed dependent on local welfare’[37] The original EZs ran for about a decade with marginal evidence of any net contribution to job creation or economic growth[38]. Some of the Urban Development Corporations set up around the same time did have a significant effect on the physical environment and commercial activity in particular areas, most notably in London Docklands. However, evaluations concluded that this impact was dependent upon fluctuation conditions in national and local property markets and did not necessarily benefit the most disadvantaged communities nor in themselves significantly reduce poverty[39].

A further turn in UK regional and local economic regeneration policy was taken under the Labour Government (1997-2010). The shifted the focus from private sector infrastructure development towards tackling social exclusion through local partnerships, active labour market policies and various community engagement initiatives. In Scotland this approach was manifest in Social Inclusion Partnerships (SIPs) which operated between 1999 - 2004[40]. While some SIPs had a thematic focus on particular target groups (e.g., younger people or minority ethnic communities), they were also a further stage in the development of ABIs intended to stimulate neighbourhood renewal[41]. Interestingly, some did have an explicit child poverty remit[42]. An evaluation of the programme by Communities Scotland concluded that SIPs were effective in improving local partnership working and engaging communities[43]. However, there was no evidence of their independent impact upon child poverty. The work of most SIPs was absorbed by Community Planning Partnerships following the Local Government in Scotland Act 2003[44].

The history of regional and local economic regeneration policy in Scotland strongly resembles that in the UK as a whole for much of the past 80 years[45]. This is unsurprising, given that policy was decided largely at the UK level until the Scottish Parliament was reconvened in 1999. Nevertheless, there were some significant developments in regeneration policy in Scotland before 1999. Much of which was led by the regional local authorities which existed between 1975-96, which were responsible for important aspects of urban infrastructure, housing and employment skills and training policy. For example, Strathclyde Regional Council was an important partner in the GEAR programme referred to above, which ran from 1976-1987[46].

The most recent stage of regional and local economic regeneration policy in the UK was initiated at the UK level by the Coalition government (2010-15) and the subsequent Conservative administrations. This takes a ‘localist’ approach, ‘which stresses the promotion of locally based strengths and assets through tailored development strategies based on local knowledge’[47]. Key policies ‘focus on promoting economic growth where conditions are favourable rather than targeting disadvantaged areas’, and regeneration is ‘only implicitly… directed towards tackling poverty’[48]. The most prominent examples of this approach in recent years are City Deals.

2.2.2.2. City Region Growth Deals and Regional Economic Partnerships in Scotland

City Deals were initiated by the 2011 UK Government White Paper 'Unlocking Growth in Cities'[49]. In August 2014, the UK Government and the Scottish Government jointly announced the first City Deal in Scotland, in the Glasgow City Region, which is planned to operate for 20 years[50]. City Deals constitute a major investment of public resources. The Glasgow City Regional Deal includes £500m each from the UK and Scottish Government and £130m from the eight local authority members[51]; the City Deal programme as a whole involves £5 billion in investment[52].

The Scottish Government’s Enterprise and Skills Review recommended that Regional Economic Partnerships should be established throughout Scotland. As a result, Growth Deals were expanded to a wider range of areas and are now referred to as City Region and Regional Growth Deals[53]. There are currently 12 such Deals in Scotland. The first ‘non-city’ Growth Deal in Scotland was agreed for Ayrshire in March 2019. It is therefore important to recognise that not only are REPs in Scotland at different stages of development, but they also vary in the character of their geography, population, and local economic conditions. However, they are similar in that all involve packages of funding and decision-making powers agreed between the Scottish and UK Governments and local partners to enable collaboration between the public and private and third sectors, education, and skills providers, enterprise, and skills agencies ‘to make long term, place-based decisions to enable sustainable, inclusive prosperity’[54].

The more recent Regional Economic Partnerships adopted a broader remit than the original City Growth Deals. While the initial Deals focused on investments in infrastructure, there has subsequently been a shift towards increasing skills and improving access to labour markets[55]. REPs are central to the Scottish Government’s inclusive growth agenda: all Deals are required to focus and provide evidence on measures and progress directed towards IG, which is not required of equivalent Deals in England[56]. The Scottish Government referred to an example of this focus in the first child poverty delivery plan (2018-22) which outlined actions agreed with the Glasgow City Region Cabinet. These included developing IG ‘monitoring and evaluation frameworks that include analysis and reporting of child poverty impacts', and working ‘with those with lived experience of child poverty to ensure their voices are at the heart of our policy development and delivery models’[57].  Glasgow is not the only City Region and Regional Growth Deal Partnership to make explicit references to IG and child poverty[58]. This commitment has been reinforced by the Equal Opportunities Commission which launched a Quality and Investment Project to embed best practice in REPs in relation to the Equality Act, 2010 and Socio-Economic Duty[59].

2.2.2.3. Other regional and local economic development policies in Scotland

Growth Deals and Regional Partnerships operate alongside several other policies introduced in Scotland in recent years related to economic regeneration and IG. Among these are the ‘place principle’, agreed between the Scottish Government and Convention of Scottish Local Authorities (CoSLA) ‘to encourage better collaboration and community involvement, and improve the impact of combined energy, resources, and investment…  [and enable] a more integrated, collaborative, and participative approach to decisions about services, land, and buildings’[60]. Separate but related to this is the Shaping Places for Wellbeing programme. This is delivered jointly by Public Health Scotland and the Improvement Service in four towns (Alloa, Ayr, Dunoon, and Clydebank), and is intended ‘to ensure that everyone in Scotland can live in a place that has all the factors that will nurture health and wellbeing’[61].

Other relevant policies include the Town Centre Action Plan, Regeneration Capital Grant Fund and Empowering Communities Programme[62]. The latter involves two targeted funds. The Investing in Communities Fund is designed to support the ‘most disadvantaged or fragile communities to tackle poverty’[63], while the Aspiring Communities Fund supports community bodies and third sector organisations in deprived areas meet a range of local needs[64].

One final concept and area of activity that has recently become prominent within the complicated landscape of local and regional economic development activity in Scotland is community wealth building. The CWB movement started in the USA and has been most notably applied in the UK in Preston[65]. The essential principle of CWB is to use local assets and capacity to retain wealth within a community and develop further economic opportunities. The Centre for Local Economic Strategies argues that ‘community wealth building is a people-centred approach to local economic development, which looks to increase the flow of wealth back into local economies and places, by giving more control to local people and businesses’[66]. This is achieved by deploying the power of local ‘anchor institutions’, i.e., ‘large commercial, public and social sector organisations (including local authorities) which have a significant stake in a place’ and which command resources that could be used to benefit the communities in which they are embedded[67]. For example, local authorities in Scotland possess significant economic resources - with an annual income in excess of £15bn, spending £7bn per annum on procurement and managing more than 40,000 assets[68]. CWB involves considering how these resources could be retained and recirculated within communities rather than extracted by external beneficiaries. One familiar example of this is community benefit clauses which set conditions for new developments and planning permission or prescribe requirements in public sector procurement to benefit local residents. However, the CWB approach extends beyond this to consider ‘how local economies can be hardwired to lock wealth into places’[69], including promoting community asset transfer[70].

Scotland's first community wealth building strategy was launched in May 2020 by North Ayrshire Council, and the authority and its partners have committed to replacing 'an extractive economic model [with]... a generative one'[71]. The council leader has declared that the CWB model in Ayrshire is ‘about the total reorientation of the economy… using the untapped power of the local state to create a new fairer, inclusive, sustainable and democratic economy’[72]. North Ayrshire Council is the largest employer in the area and spends £1 billion procuring services each year. The council has also indicated an interest in using local authority pension funds to support local projects[73]. These are substantial resources which could be used to radically transform the local economy if effective means can be found to reoriented and harness them to that end.

In theory, the potential of CWB is considerable, and it is not surprising that the Preston experience and Ayrshire experiment have attracted interest. The Scottish Government’s first child poverty delivery strategy committed to ‘pilot a specific community wealth approach to procurement with selected local authority areas’ and examine the potential contribution of CWB to reducing child poverty[74]. The subsequent Best Start, Bright Futures child poverty delivery plan reiterated this support for CWB, and proposes that every local authority in Scotland produce a community wealth building plan.

It is clear that City and Regional Growth Deals and Partnerships should be regarded as part of a broad range of activities and approaches to address economic problems in deprived and disadvantaged areas. There is a considerable body of commentary on the long history of regional policy and area-based initiatives in the UK, and several implications for inclusive growth and reducing poverty can be identified from this.

2.3. Key policy lessons from the literature

City and Regional Deals are being rolled out at a time when local authorities in Scotland face particularly difficult financial circumstances and in what has become a damaging UK-wide cost of living situation. These are challenging conditions for REPs to make a positive impact. However, one of the key conclusions to be drawn from studies of regional and local economic regeneration policies is that their impact principally becomes evident over the longer term. Structural readjustments to regional and local economies and supporting disadvantaged households in deprived and marginalised communities are long-term strategies: ‘Evidencing impact can take time - many of the challenges inclusive growth is seeking to address are long-standing and complex: it is often unlikely that there will be any “quick fixes”'[75]. A realistic understanding of the timescale over which impact may become evident is required, and this is reflected in the proposed extended time frame of REPs and Growth Deals in Scotland.

A second feature in the literature on regional and local economic regeneration is how little is known definitely, despite the accumulated experience, resources and study devoted to these measures. A recurring theme in analyses of regional and local economic policies is the inadequacy of measurement and evaluation - ‘What this means is that after four decades, it is actually impossible to say what the impact of this work actually had, if any’[76]. Another commentary on the history of these programmes and policies concluded that ‘Robust evaluation of outcomes has been hamstrung, variously, by a failure of programmes to establish baselines, set appropriate or measurable targets, put procedures in place to collect output or outcome data, or measure outcomes for programme beneficiaries’[77]. In particular, it is often difficult to determine who benefitted from investments in local and regional regeneration, e.g., whether opportunities available to residents of deprived communities were improved or these were taken up by those outside the target area. In many cases no evidence is available to determine whether conditions improved for the most disadvantaged and ‘hard to reach’ groups within a community. Some regeneration projects have actually exacerbated local area deprivation by enabling or encouraging sections of the population to leave the area, thereby further intensifying problems for those who remain[78].

This outcome is one of the potential hazards of focusing regeneration policy on places rather than the most vulnerable people in particular places. It also confirms the importance of designing any regional and inclusive growth initiative based on ‘an embedded understanding of the structural inequalities faced by particular groups of people’[79]. Effective local and regional development policies ‘must be properly customized to ensure new agencies are effectively tailored and aligned to the demand conditions within their local… Ecosystems. In short, policy should be context-led rather than mission-led’[80]. This requirement for contextualisation means that ‘There is no single successful approach, and it is for the relevant regional partnerships to determine the models that will work best for their circumstances’[81]. As the Improvement Service notes

This places obvious limits to and conditions upon any lessons which may be drawn from the experiences of particular regional or local policy initiatives. Even if success could be robustly established, what may be inferred from this requires careful interpretation.

A further lesson from the history of regional regeneration initiatives in the UK is that their rationale is not always clear, and their purpose and effectiveness often implicitly assumed rather than articulated. As one review observed, there is a ‘lack of clarity regarding the longer-term policy objectives for regional working’, and the added value of the approach is not self-evident[83]. This is indicative of the failure to underpin many such interventions with an intentional theory of change which makes explicit the anticipated connection between inputs and outcomes.

Nevertheless, there is a case for regional partnerships working to address shared economic problems in particular areas. There is also widespread support and enthusiasm for regional collaboration among authorities and stakeholders across Scotland[84]. The benefits of regional working include greater ability to plan strategically across municipal boundaries within a common economic area, pooling resources to increase capacity and leverage, and sharing good practice among partners[85]. Regional partnerships can harness and enhance the social capital of stakeholders embedded in and committed to an area; as one Growth Deal official observed, ‘a place-based approach means we can’t “cherry pick” or “move on” - but instead, there’s a commitment to a community.’[86]

Bearing in mind the conditions on and limitations to drawing general lessons, studies of regional and local economic partnerships provide a number of useful insights about both process and substantive issues. For example, several characteristics and practices can be identified as important to successful regional partnership collaboration. These include:

• a common purpose and shared priorities across the stakeholders

• trust and mutual respect among partners

• committed and sustained political and operational leadership

• clear and appropriate governance systems

• flexibility to adapt to the different ways in which regional stakeholders work[87]

Cultivating and embedding these qualities takes commitment and time, and requires all partners to adapt to one another.

For the reasons noted above, it is not possible to prescribe particular policies which can be transferred across different regional partnerships. However, a number of facilitating conditions and important policy consideration are evident from the accumulated evidence. It may seem obvious, but it nevertheless bears noting that

Fortunately, this lesson seems to inform more recent local and regional economic development policy and regeneration partnerships. They recognise that a multidimensional approach which takes action simultaneously on a number of fronts is required to promote inclusive growth and reduce poverty, including child poverty. For example, Scotland's Centre for Regional Inclusive Growth identify a matrix of issues which need to be addressed to ensure that economic regeneration is inclusive. This includes providing affordable and accessible transport, appropriate childcare provision, enhanced employment skills, digital inclusion (encompassing both access to equipment and user capability) and affordable secure housing[89]. This list resembles those proposed by other commentators[90] as well as measures highlighted by the Scottish Government[91].

A principle of the idea of IG is that neither economic growth nor increasing the number of jobs themselves necessarily reduce poverty[92]. Research indicates that economic development and increasing employment opportunities only reduce poverty when jobs are

accessible and of sufficient quality[93]. The Scottish Government refers to ‘inaccessible work conditions’, which highlights that much of the problem in lower income areas concerns the nature of jobs rather than residents’ lack of ‘employability’. Therefore, the key requirement is to remove barriers to jobs, particularly those which confront the most disadvantaged groups and households further from the labour market. The principal factors which prevent households from accessing jobs or working longer hours to increase earnings include caring responsibilities, inflexible work conditions (e.g., unsuitable hours, indeterminate incomes, insecure positions), a lack of affordable and accessible transport, inadequate physical and digital infrastructures, and discrimination against those regarded as difficult to employ[94].

Quality employment means jobs which are reasonably secure, provide reliable or predictable hours, which are sufficiently well paid, and provide opportunities for progression and skill development[95]. The Fair Work Convention supports the aspiration for Scotland to become a ‘fair work nation’ by 2025, ‘where fair work drives success, wellbeing and prosperity’[96]. The Convention’s Measurement Framework comprises five dimensions of employment quality (each of which includes several indicators): effective voice; opportunity; respect; security; and fulfilment. Supply side measures to increase employability skills or active labour market interventions might get some people into jobs but will not significantly reduce poverty if these jobs do not possess the qualities highlighted by the Fair Work Convention[97]. In fact, employment may actually worsen conditions for some households by making income less predictable, reducing entitlement to social security and passported benefits or increasing debts and stress.

Another important lesson from studies of regional and economic regeneration policy is the importance of connectivity and access to opportunities. Economic growth will not be inclusive nor reduce poverty if some sections of society are unable to access its benefits. ‘When the fortunes of a deprived neighbourhood are improved, the challenge is to ensure that the original residents benefit. If they are unable to access the new jobs being created, the risk is that they are simply displaced elsewhere as the area gentrifies’[98]. Effective regeneration strategies must therefore address the importance of ‘wheels and wires’ which connect communities to economic activities and employment opportunities[99]. As the OECD notes, ‘Connecting people up to the opportunities that exist in the labour market through better education, transport and employment support is vital’[100]. Previous ABIs and regeneration projects often failed to connect disadvantaged households to new developments. For example, the outcome that ‘The percentage of people working within the East End [of Glasgow] did not alter over the ten years of the GEAR project [is] explained by the fact that most new jobs created went to people living outwith the local area’[101].

This failure to consider who benefits from regional or local regeneration policies highlights the importance of addressing equalities issues. Inclusive measures which reduce child poverty need to ensure that any opportunities created by investment benefit women, disabled people, and minority ethnic communities[102]. Considering these issues is a statutory requirement of the Socio-Economic Duty stipulated by the 2010 Equality Act. However, the Scottish Government noted that

To avoid such unequal and damaging outcomes, the barriers which are known to make economic opportunities inaccessible must be removed, i.e., inaccessible childcare, unresponsive transport, and low paid, inflexible, and badly designed jobs. In addition, however, the focus of economic and regeneration policy should be reconsidered - traditional infrastructure renewal initiatives provide less benefit to woman and groups with protected characteristics than to able-bodied men. For example, the construction sector in Scotland has a female participation rate of 12%, and manufacturing 15%. In contrast, 73% of the health and social care workforce are women[104]. Therefore, tackling occupational segregation and investing in care are more likely to reduce child poverty than some conventional economic regeneration programmes[105].

Evidence suggests that local and regional regeneration policies are more likely to address these issues when they are informed by and engage with the communities they are intended to benefit. As the OECD Chief of Staff observed,

To ‘understand [the] “root causes” of exclusion from growth it is necessary to consult and engage local actors’[107]. This requires providing citizens with the support they need to become meaningfully involved in contributing to the design and implementation of policies that concern them[108].

The history of regional and local economic regeneration policy in the UK is extensive and complicated. Nevertheless, it provides a number of valuable lessons on how these initiatives can be more inclusive and contribute to reducing poverty. To supplement this learning, we consulted experts to explore these issues more widely and in greater depth.

2.4 Insights from key informant interviews

Interviews were conducted with four practitioners from public sector and civil society organisations involved in economic development policy and one academic expert. Each possessed a detailed knowledge of the economic and policy landscape in Scotland. Participants were asked their views on the relationship between regeneration and child poverty policy and to highlight any distinctive Scottish circumstances. Interviews were undertaken at the same time as the case study fieldwork (i.e., February - May 2022). Key informant interviews were conducted under Chatham House rules, i.e., experts provided opinions based on their professional experience and judgement and on a non-attributable basis. Interviews were conducted online and lasted between 17 - 34 minutes. Recordings were analysed to identify notable concurrences and contrasts with the research on regional regeneration policy as it relates to child poverty, and to highlight particular distinctive and interesting insights which merit further consideration or investigation. Overall, the key informants confirmed the main themes from the research and policy analysis literature, but also raised additional issues, which are discussed below.

The first opinion which several key informants expressed was the view that ‘inclusive growth’ was not clearly defined nor necessarily understood in the same way by all stakeholders in Scotland. It was suggested that IG is ‘very much deployed as a buzzword’ and remains vague. As one independent policy analyst put it: ‘I don’t think it has been defined well. And therefore, from a policy delivery perspective, I don’t think it was understood’. Despite this ambiguity, the academic expert interviewed thought that there was a potential value to the IG discourse:

Some key informants suggested that the ideas which underlie IG are not new but are generally supported by those involved in regional and local economic regeneration policy in Scotland:

Key informants agreed that regional economic development policy in Scotland had evolved over time towards a more consciously inclusive approach. In the words of one public sector policy analyst, the initial City Growth Deals ‘focused very, very much on regional infrastructure stuff - it’s about building bridges and ports and looking at renewables and all this kind of stuff. However, this has subsequently changed with more thought now given to the quality of jobs and who gets them’. REPs have adopted a more expansive approach, and there is growing interest across Scotland in such innovations as community wealth building. Interviewees felt that this shift in focus reflected the priorities of the Scottish Government and its commitment to a sustainability and wellbeing economy agenda. Qualifying this somewhat, one official from Public Health Scotland felt that prioritising IG and poverty would be easier for the more recent REPs than more established ones:

In relation to the priority accorded child poverty by REPs and within Growth Deals, the experts interviewed generally endorsed the opinion of a Scottish Government official who felt that ‘Child poverty isn’t really a key element of the City and Regional Growth Deals at the moment’. Key informants felt that those working in REPs regarded reducing child poverty as an indirect outcome of economic development, as one independent policy analyst expressed it:

However, although key informants thought that regeneration policy had only an indirect interest in reducing child poverty, some were optimistic that more consideration was now being given to the distributional impact of these measures:

Most of the key informants felt that local and regional economic policies focused on mitigating the effects of poverty rather than taking an upstream, preventive approach: ‘There’s a lot of great work going on at the local authority level, but a lot of it is mitigation work, which is clearly important and needs to be well targeted, but it’s not really the transformational change which is going to make the real difference’ (Public Health Scotland official). However, the commitment to fair work, the Parental Employability Support Fund[109] and the Shaping Places programme were mentioned by key informants as positive developments which could stimulate more proactive efforts to reduce child poverty.

Key informants were unconvinced that any REPs had formulated clear strategies to address poverty. As the academic expert put it, ‘there hasn’t really been a fixed or common or shared or sustained strategic way of thinking about how to do economic development’. A Scottish Government official elaborated on this:

The experts interviewed agreed that too many anti-poverty measures were inconsistent and short-term. The initiatives are ‘not followed through and fall out of fashion and then the next thing comes along’ (Academic expert). The perceived lack of a long-term strategic approach to regional and local economic regeneration is seen as regrettable, as expressed by one public sector policy analyst:

A related concern expressed by key informants was that some national policies were not sufficiently well co-ordinated. As the public sector policy analyst interviewed expressed it, ‘We have to do the joining up at Scottish Government level as well... There is reference to poverty in large strategies (e.g., Covid recovery) but the specific linkages between activities are not made clear’.

Several key informants expressed concern about the lack of suitably disaggregated data to determine which groups benefitted from initiatives, and document the impact of regeneration policies upon poverty more generally -

However, it was reported that this omission was being addressed and some REPs were collecting more granular information to monitor the effects of their actions. The Glasgow City Region Intelligence Hub was referred to as an example of good practice in disaggregating data to identify whether the priority households in the national child poverty delivery plan were benefiting from new employment opportunities[110]. Nevertheless, significant challenges remained in attributing outcomes to particular actions and identifying the respective contribution of partners: ‘Where we get into woolly waters, is saying, well, “what agency can we legitimately say is responsible for their element of contributing to the wider outcomes that the government are setting?”’ (Independent policy analyst).

Key informants referred to difficulties in partnership working which limited the effectiveness of regional regeneration policy: ‘There’s a lack of real good collaboration and leadership at regional levels of working because it’s still evolving’ (Independent policy analyst). One public sector policy analyst felt that there was still a tendency to think primarily in terms of existing sectors and familiar responsibilities: ‘Economic Development guys can be very blinkered and not think beyond, “This is my bit. This is what I do”.’ Nevertheless, it was generally agreed that joint working was improving and that regional partnerships were important ‘as current local authority boundaries don’t always conform to natural local labour markets and natural local economies’ (Local authority official).

The experts we spoke to concurred on the value and importance of community engagement in local and regional economic regeneration policy. One local authority official stated that community engagement was 

The Scottish Government official interviewed agreed with this: ‘I would say definitely community engagement is something that is in a lot of the different projects of the Deals’. The expert from Public Health Scotland acknowledged that engaging with communities was particularly difficult at the regional level but felt that there was an eagerness to learn more about effective practice in this area - 

Key informants pointed to what they regarded as positive examples of community consultation and engagement in regeneration, particularly in relation to infrastructure development. The BioHub in Aberdeen was identified as an interesting example of engaging with local schools[111].

However, this positive view was not unanimous, and some informants were sceptical about the extent of community engagement in REPs and regeneration work: ‘In the governance elements of regional growth deals, I would question where the community representative representation is there. I would in fact put my money on that there’s none’ (Independent policy analyst).

Key informants generally believed that representatives of the private sector were suitably involved in REPs: ‘I think that that they’re probably … quite strong on that. Obviously, that will vary across the different areas. But I do get the impression that they’re pretty on it at the local government level, and that would be reflected in the regional partnership level as well.’ (Public sector policy analyst). This view was qualified by observations of the challenge in ensuring effective representation of such a diverse sector and acknowledgement that some businesses feel that they have little to gain from volunteering for some REP activities: ‘The key trick, I would guess, for wanting to do further stuff in relation to child poverty, you know, is: what’s in it [for them]? What’s the win for the private sector for them to engage to reduce child poverty across Scotland?’ (Local authority official). It was also felt that the relative lack of large private sector anchor organisations in rural areas limited the scope for innovative partnerships.

Beyond the examples of the Glasgow Intelligence Hub and Aberdeen BioHub mentioned above, the principal recommendation made by key informants to increase the contribution of regional and local economic regeneration to reducing child poverty was to ensure that it was a central strategic priority in REPs:

An important component of this, it was suggested, was to ensure that funding streams and monitoring were both directed to actions which would reduce child poverty. The development of metrics for community wealth building and proposals to create ‘20-minute neighbourhoods’[112] as well as the fair work agenda were referred to as important developments in the right direction.

2.5 Key themes and conclusions

There has been over a century of regional and local economic regeneration policy

in the UK and Scotland. It might be thought that the sheer longevity of such efforts testifies to their failure or even their futility. However, this would be a mistaken and unduly pessimistic interpretation. Economies are dynamic and have varied effects across different places and upon communities and groups. If the benefits of economic innovation are to be socially productive, then action is required to try to ensure that all regions and groups share in them. That ultimately is the purpose of the extensive investment in regional development policy which has been considered in this Chapter.

This brief review shows that regional and local economic regeneration is a complex policy landscape with a range of alternative approaches and numerous overlapping concepts. Emerging from this complicated picture are clear signs of a shift towards a more inclusive understanding of economic development. This is accompanied by a commitment to working in cross-sectoral partnerships at the regional level, although practical difficulties are encountered in managing these. According to the studies reviewed and research undertaken for this Chapter, child poverty has been at best an ancillary interest of regional and local economic regeneration policy. However, there is evidence that it is now at least in the sights of some the main stakeholders, if not yet the centre of attention. The following Chapters report findings from interviews conducted in three case study areas to examine whether these conclusions correspond with the views of those involved in developing and delivering regional and local economic regeneration policy in Scotland.

 

[1]       Crisp, R. et al. (2014) Regeneration and Poverty: Evidence and Policy Review. York: Joseph Rowntree Foundation.