Time for a new regional development agency?

The OECD has advocated re-introducing a regional development agency for Wales. Will it gain traction?

Last week the OECD published its report “The Future of Regional Development and public investment in Wales”. Amongst its pages is a recommendation for a regional development agency.

Those familiar with the rise and fall of the Welsh Development Agency (WDA) will know why this is contentious. In its latter years, issues associated with a lack of accountability and poor organisational culture amongst some of its senior figures came to the fore. They gave rise to serious concerns in Cardiff Bay which ultimately and inevitably saw it cast onto the bonfire of the quangos. Fourteen years on from the absorption of its functions into the Welsh Government, the suggestion that Wales needs something that looks very much like it will still be cause for debate. It is not a recommendation that the Welsh Government has directly responded to, but the case made is one that deserves consideration.

What’s the suggestion?

Essentially, the report suggests that Wales would benefit from an agency that works horizontally, across different policy areas and tiers of government to support regional development and investment. It gives an implicit nod to ongoing challenges of silo working within Welsh Government by suggesting a cross cutting remit “not responsible to any individual line minister or department”.

While the WDA’s reputation was severely diminished in its dying days, that somewhat obscures the positive elements of its record since its inception in 1976. “Selling Wales to the world” was one of them, as was its success in helping to attract investment, the local and regional presence it had across Wales and its role in clearing of derelict land for new business activity. The report observes that there are still those, including those in the private sector, that continue to identify with it as a model that worked well.

Could it work?

COVID-19 is a game changer. As we’ve previously said, it could well lead to a re-structuring of the economy of Wales. With variation in economic profiles of different parts of Wales, it has already had different kinds of impacts in different places, which will require tailored, pro-active regional, local and national responses across sectors and institutions. Given the existing and potential pressures on local actors, a regional development agency would be well placed to play a role in meeting these unprecedented challenges.

In a parallel universe where the pandemic had never happened, its likely that the Bevan Foundation would still be advocating a development body, agency or corporation, at least for the south Wales valleys. Change takes time, and it rarely conforms to five-year political cycles to achieve the sometimes generational change required. The amount of difference that the current Valleys Taskforce could have made within its five-year remit and with moderate resources was always going to be constrained. When it wraps up, its strategy will be added to the plethora of other valleys strategies that have gone before.

A delivery vehicle with a long-term, clear remit, powers and freedom to support comprehensive regional development that helps tackle the deep-rooted challenges, could create a step-change in the area’s fortunes. An accountable agency with a clear and detailed understanding of the region, local knowledge and the capacity to build relationships across institutions and sectors is one that arguably has been missing from how we do economic development in Wales for some time.

The history of regional development in Wales should be a source of learning for rather than a barrier to the re-introduction of a regional development agency. As the OECD notes, it will “be important to learn from the past while also capitalising on previous practical experience”. The ghost of the WDA will continue to linger if its allowed to. Perhaps it’s time to banish it once and for all and seriously consider what’s the best vehicle to take all parts of Wales forward, to meet the economic challenges that aren’t going to go away any time soon.

Helen Cunningham is Project Officer at the Bevan Foundation. Follow her at @cunninghamhel