Background Paper 8 –Economy
THE YORKSHIRE & HUMBER PLAN
EXAMINATION IN PUBLIC
BACKGROUND PAPER 8
HOW THE PLAN SUPPORTS A
COMPETITIVE ECONOMY
SECTION 1 - INTRODUCTION
The draft Yorkshire and Humber Plan was submitted to Government in December
2005. It forms the new draft Regional Spatial Strategy for this Region. Public
consultation took place on the draft Plan between January and April 2006. The
Examination In Public to test the Plan is taking place in September/October 2006.
This background paper forms one of ten papers prepared by the Yorkshire and
Humber Assembly (YHA) to help explain the Plan’s approach. It discusses how the
RSS aims to support the development of a more competitive, modern economy in
Yorkshire and the Humber.
Justification for the approach taken generally in RSS and, specifically, in the
Economy chapter are set out in the context of how the Plan supports the
aspirations/ objectives of the Regional Economic Strategy, the Northern Way policy
initiative and Government economic policy. Specifically this paper sets out:
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The National policy context (Section 2)
The ‘Northern Way’ Context (Section 3)
The Plan’s preparation process (Section 4)
The approach to forecasting the growth of the regional economy (Section 5)
The Plan’s overall ‘economic’ approach (Section 6)
How the Plan aligns with the Regional Economic Strategy (Section 7)
How the Plan seeks to achieve a modern/fit for purpose employment land
supply (Section 8)
SECTION 2 - NATIONAL POLICY CONTEXT
Government economic policy as set out in PPS1 is to achieve high and stable levels
of growth, while ensuring that all can share the benefits of economic growth and
deliver a better quality of life. Specifically, Government aims for towns, cities and
rural areas to be economically successful and distinctive. All parts of the country
need to build on their economic strengths, encourage enterprise and innovation
across society, provide employment opportunities for all and promote lifelong
learning so they have a flexible and adaptable workforce. This needs to be within
the context of:
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social progress which recognises the needs of everyone;
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Background Paper 8 –Economy
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effective protection of the environment;
the prudent use of natural resources; and,
the maintenance of high and stable levels of economic growth and
employment.
These aims should be pursued in an integrated way through a sustainable,
innovative and productive economy that delivers strong employment, and a just
society that promotes social inclusion, sustainable communities and personal well
being, in ways that protect and enhance the physical environment and optimise
resource and energy use.
The Government’s Competitiveness White Paper, Our Competitive Future: Building
the Knowledge Based Economy, emphasises the importance of promoting highvalue sectors of the economy. It also identifies five key drivers of productivity,
which need to be addressed in order to reduce regional disparities:
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Investment – by businesses and the public
Innovation – the commercial exploitation of new ideas and expenditure on
research and development;
Skills development;
Enterprise; and
Competitive Markets.
Raising productivity and the competitive position of the UK economy is one of the
framing principles for planning. PPS11 (Regional Planning) stresses that
competitiveness should be increased at the regional level to raise the rate of trend
growth at the national level and narrow the productivity gap with the UK’s main
competitors. Improving business support activities and raising skills levels are
intended to raise competitiveness and are central to the RES.
Advancing Together, the Yorkshire & Humber strategic framework, sets out the
Region’s aspirations, which includes achieving the Government’s economic policy
aims in a way that actively promotes all of the principles of sustainable
development (see page 29 in the Plan). The overarching vision is -
“Yorkshire and Humber will be a recognisably world class and international
region where the economic, environmental, and social well being of all our
Region and its people advances rapidly and sustainably”
Advancing Together sets out:
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Objectives to focus on delivering the vision
A framework for integrating key regional strategies such as RES and RSS
Indicators for measuring progress in the Region
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Background Paper 8 –Economy
SECTION 3 - THE NORTHERN WAY CONTEXT
The Northern Way initiative seeks to close the £30 billion gap in economic
performance between the three northern regions (the North East, North West and
Yorkshire & the Humber) with the average for England. To achieve this aim, there
are a number of underlying weaknesses that constrain economic growth and need
to be addressed over the long term.
In Yorkshire & Humber, these issues are a primarily a result of under-investment
by both the public and private sector over many decades, as well as the cultural
legacy of an economy reliant on one or two industries and large employers in the
older industrial areas.
Northern economic performance has grown strongly over the last five years,
particularly in core cities like Leeds and Sheffield. Both areas have seen consistent
growth rates of around 3%, which often exceeded national averages. Importantly,
growth in these areas was able to ride out short term dips in national economic
performance – for example London only grew by 0.8% during the 2002/3
economic down turn.
While this figure of 3% is not as high as some of the peak year performances in
other large cities (such as Manchester), it does represent a major turn round for
places like Sheffield – which had a growth rate close to 0% for much of the 1980’s.
However, there is still a danger that unless the identified underlying weaknesses
are tackled robustly, growth could stall. This would mean that the Region would be
unable to reach its full potential and make its proper contribution to the national
economy.
The headline key themes of the Northern way are to:
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Bring more people into employment
Strengthen the North ’s knowledge base and drive innovation
Capture a larger share of global trade
Meet employer skills needs
Improve connectivity
Create truly sustainable communities, and
“Market” the North to the world
This evaluation can be translated in to a series of structural weaknesses which are
direct, or linked RSS, matters:
1. A low economic participation rate - which continues to be affected by
the legacy of large-scale redundancies and a now inter-generational
problem of worklessness in some communities.
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Background Paper 8 –Economy
2. Under representation of growth sectors of the economy – whose
presence would increase regional GVA and help the Region become more
competitive
3. Poor connectivity - which reflects the former employment patterns, with
poor access between the major towns and sub- areas, re-enforcing
perceptions of distance or periphery. Improvements to strategic routes,
such as the Leeds-Manchester-Sheffield triangle and opening up the
Humber Ports would improve economic functionality.
4. Strength of place, affected by historic under-investment in many towns
and centres. These areas are in need of continuing re-vitalisation.
The development of the “Core Approach” of RSS was guided by the overarching
principle of “matching needs with opportunities”. At the sub area level, key
economic priorities are identified in light of specific circumstances. These are also
guided by the “Core Approach” as set out in Policies YH1 – YH9 in the Plan.
The entire approach set out in the Economy Chapter seeks to address the under
representation of growth sectors of the economy, this is most explicitly expressed
in Policy E1 - “Creating a successful and competitive regional economy”.
SECTION 4 – PLAN PREPARATION PROCESS
Regional Planning Guidance (RPG12)
RPG12 was issued in October 2001. During 2002 and 2003 work was undertaken
on a selective review of RPG. This was aimed at filling in ‘gaps’ in RPG and
incorporating the results and recommendations of major studies completed since
the original RPG was prepared. Following public consultation and a Public
Examination, Revised RPG was issued in December 2004.
While the selective review of RPG was underway the Government introduced
proposals for planning reform to speed up the planning system. This introduced
the concept of the RSS and ‘Local Development Frameworks’ (LDFs).
During the selective review of RPG, guidance for the economy was not reviewed. A
commitment was made in the Revised RPG to review the economy policy
framework as part of the development of RSS (Draft Revised RPG, paragraphs 5.2
and 5.36). This issue was then identified as a priority for the 1 st full RSS to
address.
The RSS Project Plan (January 2004)
Topic 4 of the Project Plan was “The Economy and Economic Development”. This
indicated that RSS economic policy had a key role to play in delivering the vision of
a ‘world class’ region. Specifically, the project plan highlighted the need for RSS to:
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Background Paper 8 –Economy
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Support the implementation of the Regional Economic Strategy (RES)
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Contribute to achieving high and stable levels of economic growth in the
Region (as part of a comprehensive approach to meeting the Government’s
target to reduce the gap in growth rates between this Region and others);
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Support the implementation of any policy initiatives from the Government
PSA investigation to address regional disparities in economic growth
between regions, and:
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Support an approach to narrow disparities in economic performance within
the Region and supporting regeneration initiatives – i.e. spreading the
benefits of growth.
Other issues raised in the Project Plan included:
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Investigating the results of the work on employment land provision and
economic forecasting.
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The need to take account of the outcomes of the Objective 1 and 2 midterm evaluations and emerging work on the Leeds and the South Yorkshire
Spatial Studies.
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The need to revise the approach towards the provision of strategic
employment sites, the scale of employment land provision and the need to
support the development of business clusters.
A key overarching aim was to give priority to tackling key interrelated issues that
underpin spatial development. This included housing, the economy and transport.
It was acknowledged that this would need to include a more comprehensive
understanding the key drivers of change.
The Topic Paper Consultation (Winter 2005)
The RSS Topic Papers raised issues and challenges that policies in RSS would need
to address. The topic papers did not include draft policies and there was
recognition that there needed to be integration across topic areas before policies
were drafted.
Topic Paper 4 “Economy” set out a range of economic issues for consideration in
developing RSS. The issues fell into a number of categories:
Issues that help set the context for the whole of RSS:
 Core/ key cities, polycentric development; Northern Way
 High quality environments
 Intra and inter-regional disparities
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Background Paper 8 –Economy
Issues, which are important to the economy but cut across a number of other
themes in RSS:
 Transport links/accessibility/connectivity
 Skills
 Regeneration/ regeneration priorities, identification of zones
 The role of urban centres
 Rural economies
Issues which are primarily economic and have a regional spatial dimension:
 Clusters/priority sectors
 Employment land
 Other spatial issues arising from the Regional Economic Strategy
Task Groups/Consultation
Following the “Topic Paper” stage of RSS, there was significant working with
partner groups to further develop the economic guidance. While discussions
covered all of the issues set out in the Topic Paper, there was also effort put into
reaching a consensus on the approach to econometric forecasting (rather than the
actual results) which is described fully in Section 5 of this report.
This included regular working with:
 YHA Technical Advisory Group
 YHA Regional Planning and Infrastructure Commission
 YHA Economy Commission
 YHA Quality of Life Commission
 Yorkshire Forward (RDA)
 Adjoining regions
 Sub area/City Region stakeholder groups
 Local Strategic Partnerships
Business sector consultation was achieved via the YHA Economy Commission. In
addition, the Federation of Small Businesses was directly represented on several of
the above groups.
Specific work on specific studies also included dedicated steering/sounding groups.
The result of this work fed into the development of the “Heads of Terms”
document.
Heads of Terms Document (July 2005)
In 2005 the Regional Planning & Infrastructure Commission agreed the ‘Heads of
Terms’ RSS document. This reflected the stakeholder working and presented the
direction and main justification of RSS strategy and policy. This included a spatial
vision, a broad spatial strategy, the sub area approach and topic/thematic chapters
on housing, economy, transport and the environment.
The draft economic policy areas were suggested as:
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Background Paper 8 –Economy
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E1 Employment land provision
E1a Planning an appropriate provision of employment land
E1b Employment land reviews, site selection and development criteria
E1c Managing employment land portfolios
E1d Safeguarding employment land
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E2 Reducing intra and inter regional disparities
E2a Promoting urban & rural renaissance
E2b Support for small and medium enterprises (SMEs)
E2c Support for rural enterprise
E2d Support for priority sectors and clusters
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E3a The role of key economic assets and locations
E3b Regionally significant employment sites
Development of the Submission Draft RSS
The following sections aim to describe the drivers and considerations that informed
the development of the Submission Draft RSS.
SECTION 5 - FORECASTING THE GROWTH OF THE YORKSHIRE &
HUMBER REGIONAL ECONOMY
Without effective economic forecasting to underpin the consideration of RSS policy
options and strategy can be unrealistic, unsustainable or undeliverable. In the
past, the use of forecasts of economic performance tended to be “job gap” based
– i.e. the disparity between current local unemployment rates and a
perceived/aspirational level of “full employment”. This gap would be used to
calculate a target for job growth. This would then be translated into a “need” for
employment growth, and then to the provision of employment sites etc.
Drawbacks of this approach are that:
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It ignores the fact that, when aggregated across the entire Region, job
creation targets exceed what either the regional economy or population
demographics can support, and;
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It encourages a purely speculative approach to the provision of employment
land, which results in significant over-provision without any real recognition
of the needs of a modern economy.
On a more detailed basis, the absence of comprehensive econometric data and
modeling precludes the identification of more subtle issues, such as:
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Changes in the detailed sectoral mix of the economy
Supply-side linkages in local economies – i.e. the proper evaluation of
“ripple” effects.
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Background Paper 8 –Economy
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The nature/variation in employment growth and working age population
Variations in the economic sphere of influence of different settlements and
issues like propensity to travel to work
The RSS Heads of Terms document emphasised the importance of creating more
“joined up” regional strategy. A key component of this needed to be the use of
consistent economic forecasting data across the RSS, the RES and the City
Region/Northern Way work.
On this basis, the economic
developed using the Regional
technique in many regions. It
behalf of Yorkshire Forward.
Regional Investment Plans
Programmes.
forecasts used to underpin Draft RSS have been
Econometric Model (or “REM”). This is a standard
was developed by Experian Business Strategies on
The REM has also been used for the RES, Sub
and the Version 2 City Region Development
The model uses data on historical employment, output, productivity, population
estimates and forecasts and other labour market information to test employment
impact scenarios against a baseline dataset.
Initially the RSS utilised a single policy neutral, or base output of the regional
econometric model. However, during stakeholder working on RSS it became clear
that a scenario-based approach would be more widely supported. This approach
would have the benefit of –
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Generating a range of economic forecast/job growth
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It would better reflect non-trend issues, such as the wide range of
policy/investment interventions in the regional economy
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It could include a more aspirational view of the future economy of the
Region. While this may have higher levels of statistical risk, it would enable
the robustness of the policy interventions in the RSS to be tested in the light
of recommendations of such initiatives as the Northern Way
On this basis, a three-scenario approach was used:
Scenario A – Trend
Policy neutral, or base output of the regional econometric model. Reflects longerterm structural trends, and assumes that they will continue. It assumes the relative
performance of the Region and its areas seen over the last two decades continuing
by sector.
Under this scenario the rate of growth of GVA will lag behind that of the UK,
largely because of lower employment growth but also slightly lower productivity
growth. GVA per capita does not improve relative to the UK average. In many
respects this is a fairly pessimistic scenario as the difficult industrial restructuring
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Background Paper 8 –Economy
of the past decades in the Region is unlikely to continue and impact in the same
way in the future.
However, this scenario does not assume that the sectoral mix of the Region will
remain static; rather the base will change according to national trajectories.
Scenario B
Trend (greater reflection of recent economic performance and impact of major
programmed strategic impacts)
This is a trend based evaluation, but reflecting the recent upturn in the economy.
This scenario assumes for modelling purposes that the recent strong employment
growth will continue into the future, at least over the next decade. This
assumption is applied to each district/sub-region, so the areas which have
performed best in terms of recent employment growth will continue to perform
relatively better than the poorer performing sub-regions. Total employment growth
rates will exceed those of the UK, but GVA growth lags behind. Under this scenario
employment rates grow and exceed the national average.
The strong recent trend (2003 to 2005) in employment growth was factored into
REM Baselines to 2016. This has been achieved by applying the difference in
forecast year-on-year FTE growth nationally from EBSL's Spring 2005 Regional
Planning Service with for Yorkshire and the Humber in them current release of the
REM.
The rationale for this recognises that from 2006 onwards Yorkshire on the Humber
is forecast to under perform annually in FTE y-o-y growth compared to the UK.
Scenario C – Transformational Agenda (and impact of major programmed
strategic impacts)
This scenario is intended to address concern raised by several local authorities and
the requirement to consider “growth” based forecasts requested by the Northern
Way Steering Group. This is therefore a more aspirational scenario.
This scenario assumes the success of a range of policy interventions to
“transform” the economy of all sub regions in the following ways:
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On a sectoral basis, Yorkshire & Humber’s share of the services/growth
sectors moves more significantly towards those of the UK average
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Productivity levels in the service sectors improve to those of the better
performing regions (outside London and the South East).
Under this scenario the GVA growth rate should move towards being equal that of
the UK and there could be an element of “catch up” in GVA per capita. However,
under this scenario different sub-regions will be assumed to perform in relation
both to their relative shares of sectors and in relation to their long run historic
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Background Paper 8 –Economy
performance compared to the regional average. Growth rates in employment are
not therefore necessarily consistent.
Scenario “B” and “C” also need to reflect the impact of major
programmed/expected economic impacts at the regional scale. Table 1 below lists
of major strategic developments are intended to capture large-scale economic
impacts that are not/cannot be considered rationally within a trend-based analysis.
These new economic opportunities will (hopefully) cause beneficial “ripples” in the
Region’s economy.
Table 1
York Science City
Robin Hood Airport
Lower Don Valley (Sheffield) &
AEM/AMP Waverly
Aire Valley Leeds
Leeds centre
Humber Trade Zone/Northern Way
"Port logistic cluster"
Catterick garrison expansion
Scarborough North Bay
Estimates of Jobs
created
19,000
7,000
17,800
Time period
2006 - 2021
By 2009
by 2015
28,000
22,000
7,000
2006-2020
2006-2020
2006-2015
2,000
1,000
2006-15
2006-15
The Results
Overall, employment in the Yorkshire and Humber Region is forecast to increase by
1.6%, to 2,143,014 under Scenario A from 2006 to 2016; by 5.3% under Scenario
B, and by 8.9% under Scenario C.
This increase is expected to be particularly strong under all three scenarios in the
Electrical & Optical Equipment (20-26% growth), Other Manufacturing (14-23%
growth), Communications (41-57%); Banking and Insurance (13-23%) and
Business Services (8-17%).
These increases are offset by some sharp declines in many of the more traditional,
manufacturing sectors, particularly Agriculture, Forestry and Fishing (22-27%
decline in employment); Oil and Gas Extraction (12-24%); Other Mining (18-28%
decline); Gas, Electricity and Water (28-38% decline);
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Background Paper 8 –Economy
The Sub Regional split can be summarised as follows:
Growth 2005-2016
Scenario
Growth 2005-2010
SUMMARY - REGIONAL ECONOMIC FORECASTS
Yorks and Humber
A
B
C
+ 1.0%
+ 2.9%
+ 3.7%
+ 1.6%
+ 5.6%
+ 8.9%
Humberside
A
B
C
- 0.8%
+ 1.0%
+ 1.9%
- 1.3%
+ 2.4%
+ 5.8%
North Yorkshire
A
B
C
+ 1.0%
+ 2.9%
+ 3.6%
+ 0.8%
+ 4.6%
+ 8.1%
South Yorkshire
A
B
C
0%
+ 1.8%
+ 2.6%
- 0.6%
+ 3.3%
+ 7.2%
West Yorkshire
A
B
C
+ 2.3%
+ 4.3%
+ 5.2%
+ 4.3%
+ 8.6%
+ 12.87%
The original RSS econometric forecast was that over the period 2004-2015 FTE
employment would grow by 2%, comprising:
WY
Humber
+2.4%
– >2%
North Yorkshire
South Yorkshire
+3.6%
+ <1%
The full results of the econometric modeling exercise are discussed in detail in the
Regional Employment Land Study: Modeling Work document available in the RSS
library.
Using the Econometric Forecasts in RSS
The overall use of the three scenarios has been to generate a range of forecasted
activity for the RSS. This has been used to test policy on either a temporal
(varying by time) an uncertainty (envelope of magnitude) basis 11
Background Paper 8 –Economy
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The range of jobs created at a given time/location gives a range of activity.
For example the uncertainty of how many jobs there will be in an industrial
sector
To evaluate how activity changes over time. For example housing figures
reflect a shift in economic performance in the core urban areas.
The specific uses of the econometric data in RSS development has been to:
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Give an economic activity in put to the housing figures, including generating
the household projections in the post 2016 period using Scenario B. (This is
detailed in Background Paper 2 – Housing).
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Forecast the likely floorspace requirements for different employment uses,
and to generate the “Forecast Change In Total Employment Land In Use
2006-2016” (Table 14.6) using Scenarios A – C to give a range. This is
described in detail in the Regional Employment Land Study: Modelling Work
document.
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Generate the messages about the “District Based Spatial Context” (Table
14.8) to inform local employment land reviews.
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Forecast the upper range of the municipal solid waste arisings forecast by
incorporating economy linked household formation rates
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Determine the level of economic activity in industrial sectors likely to
generate significant waste arisings (by using the Scenario range A-C)
SECTION 6 - THE PLAN’S OVERALL ‘ECONOMIC’ APPROACH
The Plan seeks to work alongside the Regional Economic Strategy in creating a
more successful, modern and competitive economy. Its approach reflects the
Plan’s emphasis on ‘matching need with opportunity’ (see Para 3.23 in the Plan)
and also addresses issues of social exclusion and resource consumption (see
Background Papers 9 and 10). The Plan’s core approach, sub-area and thematic
policies collectively address the spatial economic issues facing the region, as
summarised below:
The Core Approach of RSS (Policies YH1 to YH9) seeks to:
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Reverse the long-term trend of population and investment dispersal away
from the Region’s cities and major towns in order to make them stronger
drivers of the Region’s economy.
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Transform the quality of cities and major towns in the Region as attractive
places where people want to live, work and invest.
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Background Paper 8 –Economy
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Support the roles of market towns as the local development and service
focus for meeting needs in rural areas, without dispersing economic
investment to unsustainable locations.
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Diversify urban and rural economies and help deliver a better performing,
robust and more competitive economy
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Achieve a focus of development and investment to better connect with
excluded communities and areas requiring regeneration, in order to directly
address the issue of low economic participation rates.

Improve accessibility and increase the use of public transport to allow the
Region’s economy to function more effectively.
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Raise environmental quality in order to make the Region attractive to
investment
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Pro-actively respond to the global and local effects of climate change so that
the Region’s economy is not prejudiced in the long term
The Sub Area Approaches
The RSS Sub Areas provide a framework for responding to the issues and
characteristics of different parts of the Region. They provide a functional basis to
articulate and develop the core approach in a way that is responsive to the whole
of the Region.
The Plan maintains a clear delivery focus on sub regions, City Regions and Local
Authorities. The sub area represents a ‘functional’ area where there are close links
between the economy of towns and cities – and where functional economic areas
are not limited by local authority boundaries, but tend to extend widely across the
sub area. The extent and scale of such linkages, is reflected in travel to work
areas, labour markets, retail catchments and housing markets.
Thematic Policies
The Regional Transport Strategy and, particularly, the Transport Investment
Priorities, have been formulated to support the delivery of the overarching
economic aims of the Plan as articulated in the Core and Sub Area Approaches.
Effective transport and connectivity are absolute key components of a properly
functioning modern economy.
The housing policies seek to match the provision of homes with spatial economic
development in the Region, set with the framework of the Core and Sub Area
Approaches (see Background Paper 2).
The Environment polices in the Plan highlight how both Region’s assets and its
resources/physical characteristics need to be managed. The Region’s natural and
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Background Paper 8 –Economy
built environment is a key economic asset and in both urban and rural areas is a
key basis to support economic diversification. The effective management of flood
risk, water resources, mineral deposits, energy and waste in the Region all have
key implications for future regional economic performance.
The Economy Chapter of the Plan seeks to specifically respond to a range of
specific drivers, including:
 The need provide more integrated guidance, less focused on simple
provision of traditional employment sites as a means of addressing
“economic development”.
 To better address the spatial implications of / links with the Regional
Economic Strategy (RES) and the Northern Way Growth Strategy
 The need for the new RSS to reflect the distinctive needs of the different
sub-areas of the Region
 Strong distinctive city and town centres, “polycentric” development
 Diversifying and strengthening rural economies
 Promoting sustainable tourism
These aims have been translated into Policies E1 to E7:

Securing more competitive economic conditions by promoting
characteristics of a modern and successful economy (Policy E1)

Strengthening the role of existing city and town centres by making them the
main focus for office, retail, health, education, leisure, cultural,
public/business services and other intensive uses (E2)

Providing sufficient land in sustainable locations to meet the needs of a
modern economy (E3)

Supporting for the delivery of RES objectives for the growth of priority
economic sectors and clusters (E4)

Safeguarding employment land from loss to other use such as housing in
specific locations (E5)

Promoting the role and development of tourism in the Region in a
sustainable manner (E6)

Supporting the diversification and strengthening of the rural economy (E7)
the
The next two sections in this paper provide further detail on the Plan’s approach.
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Background Paper 8 –Economy
SECTION 7 – HOW THE PLAN ALIGNS WITH THE REGIONAL ECONOMIC
STRATEGY
Promoting the objectives in Advancing Together and Government Policy requires
the support of a competitive regional economy while addressing issues of spatial
and demographic inequalities.
The Regional Economic Strategy (RES) has a key role in play in improving the
competitiveness of all parts of the regional economy. The RES has to operate
within and alongside the long-term spatial context for the Region provided by RSS.
However, RES and RSS need to be mutually complementary to maximize their
impact and this should be a fundamental principle that guides both the preparation
of RSS and the review of the RES.
Section 5 of the Plan sets out how the high-level regional strategies align. This
includes the RSS, RES and the Regional Housing Strategy (RHS). Policy E1 in the
Plan sets out more specifically the common spatial agenda of RES and RSS in
creating a more successful and competitive regional economy.
The six objectives of RES are:
1.
2.
3.
4.
5.
6.
More businesses
Competitive businesses
Skilled people
To connect people to good jobs
Enhanced transport, infrastructure and the environment
Stronger cities, towns and rural communities
While much of RES is non spatial in its approach, there are areas of important
linkage with RSS. However, the extent of the RES – RSS spatial relationship was
unclear. On this basis, and in order to properly understand the spatial components
of RES, a specific piece of work was carried out jointly with Yorkshire Forward in
2004. The final report of this study “Mapping the Regional Economic Strategy
2003-12” is available in the RSS library.
This work contributed significantly to the preparation of the Economy Topic Paper.
Following the Topic Paper consultation, the following matters were taken forward
into the Heads of Terms Approach and then addressed in draft RSS Key Economic Locations
RES emphasizes that high quality locational ‘assets’ are critical for economic
success. The most competitive cities and regions are doing more to improve the
quality and distinctiveness of their places and the infrastructure that services. Of
the range of critical assets that underwrite the performance of the economy, the
RES identifies several as important:

Transport infrastructure, both internal links and external connections
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Background Paper 8 –Economy
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Universities and other institutions of higher education
Key sites such as large-scale quality business sites and incubator
accommodation for high tech start up companies
Tourism and environmental assets
The Plan’s Core Approach places a key economic emphasis on the Region’s cities
and towns – identified as Regional, Sub-Regional and Principal Service Centres
(see policies YH5 & YH6). This policy approach specifically seeks to enhance
quality of place.
The economic significance of the Region’s environment, coastal and rural areas is
recognised in policies YH3 and YH7. The Sub Area Approaches identify key
economic priorities and Regionally Significant Investment Priorities across the
region.
The Economy section seeks to strengthen the role and performance of city and
town centres.
Small and Medium Enterprises (SMEs)
In the “Topic Paper” stage both Yorkshire Forward and several regional economic
stakeholders articulated the view that RPG underplayed the role of SME’s in the
regional economy. For example, there were concerns about the lack of suitable
accommodation for small businesses and their expansion.
SMEs have been identified as one of the key drivers of the regional economy in the
RES. Yorkshire Forward has sought to take direct action to support the expansion
of small businesses, for example by funding or facilitating the development of
starter or incubator units. On this basis it was considered appropriate to consider
opportunities for the support of SME’s in RSS.
This was articulated in Policy E1 and the context for Policy E3 in Draft RSS. These
stress the importance of SME’s and promote the consideration of their needs in
plans, strategies and employment land reviews.
RES Clusters and Priority Business Sectors
The Government’s Competitiveness White Paper, Our Competitive Future: Building
the Knowledge Based Economy, clearly emphasises the importance of promoting
the expansion and creation of clusters or networks of knowledge driven
companies. RES also emphasises the development of key business clusters.
Although there is little actual evidence in the Region that cluster development is
inhibited by planning policy, some concerns have been raised by Yorkshire
Forward. There are specific instances of cluster-related business developments
such as chemical industries, having difficulties in securing planning permissions.
Policy E4 “Support for Regional Priority Sectors & Clusters” addresses this issue.
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Background Paper 8 –Economy
Effective Employment Land Provision
One of the key issues for the RES and the review of the RSS is restructuring of the
Region’s employment land portfolio. This issue is fully described in the next Section
of this paper.
Improving Connectivity
The Regional Transport Strategy in the Plan sets out transport investment and
management priorities for the Region. The transport priorities set out in RES have
a specific economic focus. These fit within and support the wider range of
Transport priorities identified in the Plan. The Plan’s sub-area sections set out
priorities for managing transport connections for each sub –area.
SECTION 8 – HOW THE PLAN SEEKS TO ACHIEVE A MODERN/FIT FOR
PURPOSE EMPLOYMENT LAND SUPPLY
The Economy Topic Paper set out the pressing need for the economy chapter to
get to grips with employment land supply issues in the Region. The approach used
in the Plan, for the first time, was to try and balance all of following objectives:
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Forecast (rather than simply aggregate local economic development targets)
economic performance from a range of econometric forecasts.
Consider the overall RSS policy implications on market demand
Consider the likely impact of major planned investments
Measure the current supply position of allocated sites in the Region
Estimate the strategic gaps between likely demand and current supply
Provide a strategic steer to LPAs
Recognise that supply will keep changing
Allow proper space in the approach for local studies/LDF work to consider
detail location, quality, availability and phasing
In addition, it needed to be recognised that modeling the economy as described in
the previous sections is not a simple process. The employment land guidance and
forecasting needs to be considered in the context that:
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While Local strategy/RSS/RES may look to secure economic growth, this will
not necessarily be by increasing the numbers of jobs in a particular sub area
of the Region
RES does not look to particularly spatially redistribute jobs in the Region
The modeling is sector based – so areas that have done well in the past
tend do well in the future
The modeling by itself does not reflect what RSS is trying to achieve
While the impacts of major initiates and schemes are modeled – e.g.
University clusters, this does not provide a precise location for the new jobs
The new jobs figure is not a target, nor is it an aspiration. Instead, it is
a means of gauging how many jobs are likely to be in the total regional
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Background Paper 8 –Economy
economy if the sectoral mix of the economy changes in line with national
and international trends
Policy Implications/Translation -Supply of Employment Land
The Plan’s approach provides the first attempt at modeling the need for
employment land for Yorkshire & the Humber in a structured manner. Traditionally,
this issue represented the mainstay of strategic guidance for the Economy.
In preparing their Local Development Framework Local Planning Authorities will
need to robustly review their portfolios of employment land, as well as providing
more delivery-focused policies for bringing sites forward for development. In this
regard, the biggest issue RSS needs address is the extent to which the current
supply of allocated employment sites is appropriate (in quantitative, qualitative and
locational terms) with the patterns of current, projected and planned economic
growth in the Region.
Policy E3 of the Plan sets out a strategic policy framework to address this. It was
identified at the “Topic paper” stage that the regional supply of strategic
employment land (i.e. sites of at least 1 hectare in size) was excessive.
In 2003 there was approximately a total of 6000 ha of sites >1ha. Current take up
for employment land in the Region is estimated at 255 ha per annum. This gives a
headline figure of over 23 years supply. However, much of this land is not
immediately available for development, with only 10 years supply of sites available
for development within three years.
On average only 40% of allocated sites were on previously developed land. In
some parts of the Region only 10% of allocated land is on brownfield sites.
A significant proportion of the regional employment landbank is comprised of
legacy sites, i.e. land which has remained undeveloped for 10 years or more. As
work by English Partnerships has exposed, many of these sites may be unlikely to
be redeveloped in the near future or may be in unsustainable locations. This issue
is set out in detail in the English Partnerships national project, the “2002 Hardcore
Sites Study”. This work is currently being updated.
Safeguarding employment land
A major issue to emerge from the RSS consultation process was the safeguarding
of employment land from other land uses, principally to housing uses but also to
retail/leisure. This was felt to a growing issue in several parts of the Region,
including areas of previous low market demand, such as Sheffield city centre.
There were concerns that if this issue was not addressed, economic performance
in the main urban centres could be compromised by a shortage of employment
sites. However, feedback during the consultation indicated that any approach
should not be generic, but that in certain specified areas under pressure
employment land should be protected.
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Background Paper 8 –Economy
Policy E5 sets out the proposed Plan policy and includes safeguards to avoid the
issue of LPAs seeking to maintain unrealistically large portfolios of sites.
Yorkshire and Humber Assembly
July 2006
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