Challenges for inclusive regional economic development

Research to identify how best to achieve inclusive regional economic development across Scotland

Inclusive Regional Growth

Digital Scotland will be submitting a proposal response to this RFP from the Improvement Service, a request for research to identify how best to achieve enhanced inclusive growth across Scotland, driven at a regional level by Local Government. This article outlines the initial analysis we’ve conducted and the main challenges identified thus far.

South Lanarkshire

Our approach is to focus on one specific town and local authority, this being Lanark and South Lanarkshire Council, with a view to understanding the issues in detail and developing a blueprint that can then be repeated nationally.

Clearly the town faces significant challenges, symptomatic of broader economic difficulties, with the high street a showcase of deprivation such as the derelict Royal Oak hotel and similarly run down old Regal cinema across the road.

The primary conclusions forming that we will research in detail are:

  1. There is no program capacity at all for incubating and supporting local Digital innovations and entrepreneurs.
  2. Economic Development programs are predominately organized in a top down fashion and struggle to reach and deliver tangible benefit at the local, small and rural town level.

Delivering a Digital Council

Naturally our overall agenda is one of Digital strategy, and in this case analyze how the Government’s overall policy and ambitions translate into local level action and benefit.

South Lanarkshire’s overall regional strategy is documented here, and their plans for a Digital Council defined in detail here.

The primary challenge that the digital strategy faces is one common to many ICT roadmaps : It is focused entirely on the internal systems of the organization, there is no explicit link to the regional goals defined by the Council.

The Council’s overall plan identifies key goals such as ‘Support the local economy by providing the right conditions for growth, improving skills and employability’, however there is no statement of this goal in the ICT plan, which instead focuses purely on the implementation of internal technologies.

Like most IT roadmaps it focuses entirely on the internal organization only, covering aspects such as data management, security, and various applications they will use; in short a plan for operational IT. To highlight the central point, it states the adoption of more Agile practices, but in no way describes how doing so will make possible better social inclusion, increased tourism or other strategic goals the Council has tasked itself.

Funding challenges: Leader / BID

Our project will link this digital strategy to the region’s overall economic goals, those addressed by Planning and Economic Development. This identifies that a major funding stream for this type of local innovation is the ‘Leader‘ program, with plans for Lanarkshire documented here.

This highlights the type of challenge local government faces with regards to strategies for economic rejuvenation of local communities – Leader is currently closed to new applications, they do not have sufficient funding for the level of proposed projects, and the application process itself presents a very high hurdle: It is intensely bureaucratic and requires projects to match fund. The Scottish Government recently published their own analysis of Leader.

Ultimately this will mean that many small, grass root projects that are essential to community revitalization will not receive support from the primary source of government funding intended for that purpose, nor is their large scale investment into technology supportive of this goal either.

Similarly Lanark is currently organizing a BID (Business Improvement District) proposal. While this is undoubtedly a locally driven initiative for benefit of local businesses, it too is subject to considerable bureaucracy, is a slow moving process and will result in top-down funding in an ‘all or nothing’ mode – There is no active business / project growth support until the process is complete.

Digital Tourism

A well developed strategy can provide the leverage for securing an overall investment into the region. For example the funds to rejuvenate the hotel and cinema buildings described above, with a view they will be keystone components of the overall visitor experience. With plans to better capture more of the massive tourism inflow to Scotland, towns can invest around this growth.

Through VisitScotland there is an excellent national level of digital tourism marketing for Scotland, however again this is highly centralized and top down. There is strong support for the large regions but little for the rest of the country, particularly the small communities like Lanark.

They do offer growth funding for local projects, however again these are run infrequently and are of an ad-hoc nature, not part of a general capacity building exercise, and VisitScotland is not responsive to the need to do so. When approached about developing such capacity none of the VisitScotland senior leadership team replied.

Conclusion

To define inclusive regional economic strategies a first challenge is to understand how current Scottish Government economic development policies act to create exclusion, a result of these overly centralized, top down approaches. What’s needed is a highly localized, bottom up model capable of incubating and supporting lots of small local projects, but there’s no program capacity for doing so.

The context for this is articulated very effectively through this CommonSpace report Mapping Economic Potential in North East Glasgow‘.

The report describes chronically deprived areas of Glasgow and how traditional Economic Development strategies have failed to address the issue despite decades and huge sums of investment:

“A toxic combination of neglect at local authority level and macro policies pursued by successive distant governments has seen potentially beneficial policies being overlooked in favour of ‘topdown’ regeneration policies which encourage gentrification and the pushing of marginalized people further to the fringes of the city, with too much reliance on multi-national companies to create jobs.”

Digital Capacity

Secondly hand in hand with this issue is that there is no local ‘Digital capacity’, what would act as a catalyst and accelerator of local economic programs.

Like all of Scotland’s towns Lanark needs to be suitably equipped for the 21st century economy, and in such a way it supports goals such as local routes to work and job creation, through facilities such as a ‘Digital Work Centre’, a shared office space for locals to use for Internet and business support purposes.

This should be married with the development of local entrepreneur networks and services to digitally enable local businesses. For example the majority of the town’s small businesses such as the high street stores, do not even have a web site. Combined with the lack of an overall digital tourism portal this means no aspect of the town or its business functions is presented to the global market in a way that would attract new visitors and thus growth.

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