What does the North East Combined Authority Local Growth Plan aim to achieve?

This article discusses the North East Combined Authority’s (CA) first Local Growth Plan, released last year. It highlights the unique footprint of the North East and the diverse interests and industries the North East CA will need to understand and invest in, whilst supporting the communities and missions it sets out to achieve.

Background

The North East Combined Authority (CA) has released its Interim Local Growth Plan, an ambitious 10-year plan to improve and grow the region’s economy. The North East CA is a new Mayoral Combined Authority which was formed in May 2024 as part of a devolution deal for the North East agreed back in 2023. The Combined Authority is led by the first North East Mayor, Kim McGuinness and the leaders of each local authority area covered by the North East CA, Durham, Gateshead, Newcastle, North Tyneside, Northumberland, South Tyneside, and Sunderland.

The plan

The plans recognise the need for holistic support for the local area to create true economic growth for residents, including employment and skills programmes, tackling health inequalities and alleviating child poverty. The five key missions the plan sets out are:

• Home to a growing and vibrant economy for all, with support for businesses to create jobs and for local people to have the appropriate skills to take up those jobs.
• Home of the green energy revolution, to use the opportunity of net zero to transition to a green economy using new technologies and solutions, creating thousands of jobs.
• A welcoming home to global trade, using the region’s existing exporting reputation to increase global exports, particularly cultural exports, and to secure more global investment.
• Home of real opportunity, to create opportunity that leaves no one behind to ensure ‘inclusive growth and good public services are spread across the North East.’
• A North East we are proud to call home, to deliver these investments and changes in the local area that align with the priorities of local residents and that support them to live in the North East and be proud of their local identity.

The plan’s objectives are not just economic but outline real, tangible benefits for residents as a place to live and thrive. In addition, considerations are made for improving and creating better infrastructure, including housing and digital connection, and an emphasis on public transport.

Key industry sectors

To achieve these missions, the North East CA has identified ‘key industry sectors which will be the driving force for economic growth, and act as a catalyst for much wider benefits to local people.’ These include:

1. Advanced manufacturing (including Electric Vehicles) will build on the existing industry in place in the North East, including the Nissan factory (in Sunderland currently building EV) and expand business and investment in this area, which will align increased EV infrastructure rollout and increase jobs and skills in the area.
2. Defence, security and space will build on the existing space cluster of NEEST with Northumbria University, and the North East Regional Defence and Security will develop the supply and R&D capacity to make the North East a hub for defence, including digital defence.
3. Offshore wind and energy transition will capitalise on the existing assets of Blyth Energy Central and existing geography to expand infrastructure, jobs, and training. This is to align with the current global move to transition to green energy and with the goal of becoming the UK’s most advanced offshore wind industrial cluster.
4. Tech, digital and AI will be another industry of focus with investment in the £10bn Hyperscale Data Centre in Northumberland. Plus, plans to establish an AI Growth Zone to become a leader in 5G and autonomous transport. There will also be an expansion of digital skills through the Digital Talent Engine.
5. Creative industries and content have seen a 68% increase in jobs over the past 10 years, which the North East CA wants to capitalise on with a focus on creative hubs, such as the Gateshead Quays and Baltic Quarter, and widen access to education in creative sector jobs.
6. Life sciences, pharmaceuticals and process industries will capitalise on the universities in the area and support more spin-outs and incubation spaces to be a leader in the industry.
7. The foundational economy currently accounts for half of all employment in the region. It provides services and goods essential to everyday life (including the public sector), it has the highest proportion of female employees and is known for more flexible working. This part of the economy will be supported through increasing pathways into it and improving job quality and progression.
8. Rural and coastal economy is a unique selling point for the region. These areas need to be cared for and protected, as well as promoted and grown, so that the economy is sustainable and works for local people. This includes improving rural broadband and transport, and promoting local food and agritech.
9. The visitor economy plans include developing an international conference centre, attracting more international tourism and increasing training and employment pathways to the hospitality industry to achieve their goal of doubling the visitor economy’s GVA in the next 10 years.

Turning plans into actions: moving forward

To facilitate these ambitious plans, the North East CA is creating a new North East Investment Fund with £70m to invest in local businesses, industries and other ways to stimulate wider economic growth. Private investment is also being sought, and the authority hopes that these plans will attract wider attention and further increase investment in the region.

The North East CA is currently working with partners to consult and continue to develop their plans before they are finalised in Summer 2025 after the Government’s Spending Review. They hosted a number of information sessions throughout April with an open call for feedback until the end of May from the community on their perspectives on the plans.

Challenges

The plan identifies a wide range of key industries for development, the challenge will be balancing sectors with varying needs and levels of attractiveness to private investment. While industries such as pharmaceuticals may attract investment, they employ fewer individuals compared to the foundational economy, a significant local employer that presents less opportunity for growth and investment. The region’s diverse geographical landscape presents unique growth opportunities, but also poses challenges in addressing the distinct needs of urban, rural, and coastal areas.

Infrastructure development is essential for supporting growth, with a strong focus in the plan on public transportation. However, significant investment and improvements are required to improve public transport accessibility and provide local residents with real opportunities for wider employment and training opportunities across the region. Investing in training and upskilling the local workforce is a long-term objective, and ensuring inclusivity. However, in practice, upskilling, particularly inclusive upskilling, is a long-term endeavour that may initially be outpaced by the need to bring in skilled employees from other regions.

As one of the first mayoral strategic combined authorities to implement such a plan and receive government funding, the North East Combined Authority is pioneering a new approach. This process will involve addressing challenges and developing best practices, as previous regional and local growth plans did not originate from strategic mayoral combined authorities.

Final thoughts

As the country is in the midst of local government reorganisation and devolution with the aim of creating more strategic combined authorities, it will be interesting to see how the North East Combined Authority uses its devolution powers and funding to create and administer a range of services including the economic growth of the local area, as well as achieving the missions it sets out in the plan.