Agenda item

Members were provided with a report and presentation outlining the Enterprise Zones programme and issues relating to the availability of space for businesses in the region.

Questions and discussion centred around:

• Success and performance of Enterprise Zones (EZs): The 2017 EZs sites have not yet had the time to impact job creation as expected, with an estimated one-third of expected jobs currently created. The evidence suggests that where authorities can help unlock the stalled EZs sites, investment and the private sector does follow. The oldest, and most successful EZ site, Leeds Aire Valley, took a while to develop but is now fully built and filled. The Gain Lane site was stalled for 15 years prior to EZ designation and the investment of Local Growth Funds (LGF) which enabled capital infrastructure to be developed, and that site is now also full. One area of challenge was that the original vision of attracting advanced manufacturing has only succeeded in pockets. Another is that there is some displacement from other areas as companies move to EZs to expand. There is no evidence that there is any adverse effect of competition between EZs which are close to each other in different districts. 

• Level and use of business rates income: EZs include both business rates relief up to £250,000 for five years for businesses based in them by March 2022 and allow WYCA to retain any business rates revenue generated thereafter until 2042. The projections for business rates revenue were last completed in 2020 when LGF funding was coming to a close and is currently around £2.5m income per annum. To date this revenue was redirected into supporting core business support services at the CA. Members asked about current business rates income and future projected income and wondered if this could possibly be ringfenced for investment into further revenue generating activities. The LEP has strategic oversight of the EZs and it is understood that the government may reform LEPs further in future, but this should not have a negative impact as the CA acts as the accountable body for both the LEP and for retained business rates. The CA has not performed impact assessments on lost business rates for the local authorities, which they may have done themselves, but in one example, some of the early development of the Aire Valley site (the link road) involved borrowing and Leeds Council was repaid using some of the rates from that site.

• Demands for space and offices in the region: Further research is still needed to determine exactly what business needs are with regards to space and if it is suitable for them to expand into and why they have or haven’t expanded – in addition to further work to identify all available spaces across the region. Most reports are currently anecdotal and need collating into something more quantifiable and data based. Demands for office space has changed since the pandemic and it is not yet clear what the long-term effect is, as it is a complex picture. There is still the challenge of businesses seeking to move into the region preferring Leeds city centre spaces, but big developments in other council areas such as Bradford’s One City Park has shown that there is growing demand for space there too. The CA’s inward investment teams which support businesses relocating to the area promote all parts of the region and ensure that businesses are aware of offers outside of Leeds centre.