Doh! University Enterprise Zones – why didn’t we think of that?
Government’s penchant for shallow PR over serious local growth policy and practice is exposed yet again with its launch of the University Enterprise Zone (UEZ) ‘competition’ earlier this week. The competition is for £15m over 3 years in 3-4 ‘pilots’ whom can bid for a maximum of £5m each. Competition eligibility is restricted to the eight ‘core city LEP areas’, and applications must be submitted by a lead university.
The UEZ winners will receive government investment in incubator and/or grow on space; some attention from UKTI; and a simplified planning regime locally. They will NOT receive Enterprise Zone financial incentives. Proposals will be assessed by David Willetts, on the advice of an unspecified ‘assessment panel’, against a set of vague criteria – project design and deliverability; demand and market potential; alignment with government priorities; contribution and wider benefits to Local Economic Partnership (LEP) strategic economic plans (SEPs) and university business plans; financial leverage/viability.
In a week when LEPs and partners (including universities) are working desperately hard on serious plans and strategies – finalising over £5bn of EU structural and investment fund 2014-20 (SIF) submissions, responding to feedback on strategic economic plans (SEPs) including their bids for £2bn p.a. of Local Growth Fund, and indeed considering investment propositions in ‘real’ enterprise zones (where they have them), it might be thought frivolous to waste a blog on this type of fluff. However, there are a small number of major issues that come out of government’s approach to UEZs which those genuinely committed to local leadership of growth may wish to consider and take forward.
First of all, it is worth reflecting on the scale of government’s ambition for UEZs. £15m over three years, with financial leverage of 2:1, at average industry benchmarks for high quality science parks could deliver of the order of +/-12000 square metres of lettable space and perhaps 1000 jobs. This is potentially significant for the 3-4 locations involved, but hardly transformational.
Second, the government seems to have ‘forgotten’ that university involvement in incubation and innovation business growth ‘eco-systems’ has been almost the norm for a generation. A cursory look through, for instance, UK Science Park Association (UKSPA) membership shows around fifty English Universities involved in the association, and no doubt there are many more who are not UKSPA members. Similarly, of the 24 already designated Enterprise Zones (effectively with all UEZ benefits plus more), some are ‘anchored’ by university investments, and a majority have at least some HEI involvement. So what exactly is being ‘piloted’ here? Government’s seven page guidance does not throw much light on this.
Government’s eligibility criteria for a UEZ pilot of the eight core city region LEPs automatically excludes over 90 (or around 75%) of the UKs HEIs, and over 80% of the top universities for interaction with SMEs identified in the Witty Review. It may also lead to some interesting challenges within eligible LEP areas. With from six (Leeds City Region) to two (Sheffield City Region) HEIs in each LEP area, on what basis will a ‘lead’ university for the UEZ be selected?
Slightly oddly, the ‘piloting’ of university-innovation interaction through investments in incubation and move on accommodation is something that government has already majored on through, for instance, a number of Regional Growth Fund investments; some contributions from HEFCE, TSB and RCUK; and the existing ERDF programmes. And, should they be so inclined (and many are), LEPs and partners can take a more strategic and significant step forward in this arena with their impending SIF and SEP submissions.
This latter point is surely the major issue for LEPs, local authorities (LA) and businesses. Wouldn’t it have been wonderful if, when Government announced on December 13 2013, “we’ve had this great idea…£15m over three years for 3-4 UEZ pilots”, collective authoritative local voices had said “hang on a minute, David (Cameron or Willetts) – let’s work together to shape an interesting and powerful proposition that we can genuinely test and develop…and we can co-design and co-fund this with our impending SIFs, perhaps other local resources, and with collaboration from your key national agencies like HEFCE and TSB”.
A serious local set of ‘asks’ of national government to embed universities in local innovation eco-systems would include LEP/LA/Business traction in setting university strategic plans; probably a level of devolved HEI funding to incentivise universities to align with local priorities; and the type of ‘growth pact’ arrangements with national bodies which go well beyond the prescriptive (in UKTIs case) or non-existent (in TSB, HEFCE and RCUKs cases) opt-ins on offer for the EUSIFs. Articulating those type of ‘asks’ collectively remains very much ‘work in progress’ for the LEP network, the LGA and the other multiplicity of associations beginning to raise their lobbying efforts in the run up to 2015 national elections. But, the UEZ example illustrates that this ‘work in progress’ needs to be accelerated and reinforced.
In a sense, the easy part of university-business innovation collaboration is throwing up an incubator or move-on accommodation. A huge amount of this was done in the decades prior to the global financial crisis, building on examples like St John’s Innovation Centre (SJIC) in Cambridge – the first such centre in the UK now over 25 years old. Many of these initiatives have had successes, and the physical building has played a role – but it is the culture of enterprise, the networking, the availability of fit for purpose financial instruments, mentoring and other support that are the critical success factors. Regrettably, the government UEZ guidance is silent on these points.
I am not sure government would receive a third class and any honours for their UEZ initiative. However, LEPs, LAs and partners do have an opportunity in their SEPs and SIFs to articulate strategic, transformational visions and practical proposals for building local enterprise and innovation eco-systems. These will require a more flexible and permissive response from government and its agencies than we have seen hitherto if they are to be implemented effectively. And that response is more likely to be forthcoming if we articulate our ‘asks’ collectively, rather than focusing our energies on competitions for 1/3 funding of a few thousand square metres of business accommodation.
