How Birmingham is using property development to re-tool its economy

The new New Street. Image: Getty.

Something I’ve noticed when visiting Birmingham over the past couple of years: parts of the city have started to feel rich.

The new glass-fronted offices of the central business district, Colmore Row, blend in better with the grand Victorian architecture that surrounds them than you have any right to expect in a city whose architectural history is as chequered as Birmingham’s. The names of the shops point to a certain prosperity, too. Nespresso. Harvey Nichols.

Colmore Row is not the whole of Birmingham – as so often in England’s regional cities, you can turn a corner and find the city centre just stops, to be replaced by crumbling housing estates or derelict industrial land. And subjective impressions are, well, subjective. But there’s a core of prosperity in Birmingham that many cities would kill for.

Part of the explanation lies in the city’s proximity to London: a number of major financial or professional service firms, refugees from the capital’s property prices, have moved chunks of their operations to the Midlands. At a Centre for Cities event in late 2014, the American urban theorist Edward Glaeser suggested that Birmingham could have a bright future providing back office services to London. The following August, HSBC announced it was moving 1,000 jobs there.

But another part of the explanation is that the city has been, literally, planning for this. In 2010, the council published the Big City Plan, a “20 year vision... supporting transformational change to create a world class city centre, delivering sustainable growth”. Cut through the thickets of jargon, and that basically means building a load of nice new shops and offices, and making sure people can get to the bloody things.

The big plan

The recent extension of the Midlands Metro tram into the city centre fits into this plan. So does the New Street station development, in which the dark and cramped concourse has been replaced by an airy light canopy, and the grim brutalist Palisades shopping mall cleaned up and rebranded Grand Central. (The tram now terminates at the confusingly named Grand Central New Street; one day it’ll extend through the nightlife district into Edgbaston.) The shopping centre’s largest retailer, John Lewis, was “lured in by the Big City Plan,” says director of planning and regeneration Waheed Nazir, one of its authors.

The extending city centre. Click to expand. Image: Birmingham City Council.

The biggest idea in the plan, though, is to extend the footprint of the city centre by 25 per cent, by transforming under-developed land on the edge of the city centre – “book ends”, Nazir calls them – into posh new retail and commercial space. The city was prevented from doing any such thing for many years by the inner ringroad (the “concrete collar”), which made it impossible to leave the city centre on foot without using a dingy subway. Burying sections of that, and re-directing traffic where possible, made it possible for the city to expand.

The Big City Plan has already seen new developments around Colmore Row, and on the West Side (the “Paradise” redevelopment, currently separating the city centre from the ICC conference hall at Centenary Square). It’s also seen the city relocate the old fashioned Bull Ring Markets from the Smithfield area around the back of the shopping centre, on the grounds that it was occupying what Nazir calls “prime real estate”.

Much of this work will come from private developers, but the city is investing too. “The game changer was keeping business rates,” says Nazir. “Suddenly TIF [tax increment funding] was viable.” TIF is, basically, a mechanism for funding developments by capturing the uplift in property values those projects will create. Doing this will give the council at least £700m of investment capital to play with, and possibly up to £1.2bn.

The city’s biggest investment priority, though, is one which it can’t control: High Speed 2, the rail link which will shave a few minutes off the journey to London. During the recent Conservative conference the city’s enthusiasm for the new rail link was literally visible on seemingly every available surface, with posters plastered all over the place. (That said when I visited the city to speak to its leaders back in the spring, whenever I asked what the city’s priorities were, everyone gave me the same identical answer: protecting vulnerable children. I got the distinct impression a memo had gone around.)

Nazir denies that talk of HS2 has been the key to the city’s regeneration – Deutsche Bank moved there in 2008, before it was even a gleam in Lord Adonis’ eye, he points out. “But it brings confidence and changes perception of the city.”

The new economy

It’d be misleading to suggest that Birmingham sees its future entirely as a sort of commuter suburb of London. Besides the central business district, the Big City Plan also proposes a number of other economic zones where it hopes employment to grow: a food hub, an advanced manufacturing hub, and so on. Council leader John Clancy vision for the city is as a “nimble, tech driven manufacturing” economy. To that end, it’s investing in facilities like the BioHub life sciences centre on the edge of the university campus.

I meet Clancy at the Innovation Birmingham Campus, a sort of tech hub in the Aston area. He was in ebullient mood: the government’s independent improvement panel, which had been monitoring the city’s children’s services department, had just left the city (the cause of that memo, one assumes), and he’d just been talking to some American visitors. “They like big things,” he said. “Well this is the largest local authority in Europe. We’ve got a £3.1bn budget and own 40 per cent of the city.”

HS2 is an “absolute game changer” he tells me. Curzon Street, the currently derelict area on the Eastside where the new terminal will be built, is “absolutely an investment hotspot that the world is interested in”.

The Metro extension, because we love a map. Click to expand. Image: Birmingham City Council.

But the opportunity is as much about skills and jobs, he adds. “We’ve been known as a motor city. Now we may very well become known as a train city.”

The city has other investment plans, too. It wants to build a Bus Rapid Transit network called Sprint. It also wants to “upgrade its housing to make it a better asset”, says Clancy.

To fund this, it’s been talking to the Treasury about increasing its borrowing powers through by launching “brumme bonds”. (This one’s gone a bit quiet since Brexit.) It’s also trying to encourage local capital to remain in the city: “It’s about re-writing things so that the pension fund is feeding back into the local economy.”


From next year, of course, despite being the leader of Britain’s largest local authority, Clancy will have a bigger figure above him: the new West Midlands metro mayor, elected by the residents of Birmingham and six other boroughs. The leaders of all seven will make up his cabinet, however. “We’re not ceding power upwards, except possibly in transport. If anything, the power of local leaders will be enhanced.” The Big City plan is likely to continue.

In terms of selling the Midlands to the world, Clancy points to an unexpected ambassador. “People in the UK don’t associate Shakespeare with Birmingham – further afield they do.” Stratford-upon-Avon isn’t technically covered by the West Midlands metro mayor, but Warwickshire is a non-constituent (that is, non-voting) member.

Birmingham doesn’t have the strongest brands among British cities, and the West Midlands has often seemed to get forgotten in the race to build a Northern Powerhouse. But when I ask him if he feels that the city is overshadowed by Manchester, Clancy – a native of Stockport, albeit one who’s been in Birmingham for 27 years – professes to be relaxed. “This is about re-balancing the economy, and I’ve no problem with the economy being rebalanced to Manchester and Birmingham.” (I’d only asked about Manchester. The reappearance of Birmingham in that list is his own.)

“Good luck to Manchester,” he adds. “I wouldn’t say I think we will match [the Greater Manchester deal], because we were late to the game politically.” Yet he is certainly ambitious for his adopted city. “We might even see parliament move here,” he adds. “They’ve got to move it anyway – and I’m sure we could accommodate the United Kingdom parliament.”

This is part three of a series on the West Midlands. You can read part one here, and part two here. Next time: onwards to Coventry.

Jonn Elledge is the editor of CityMetric. He is on Twitter, far too much, as @jonnelledge.

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Handing power to cities could help government make better policy

Research scientists prepare a batch of Malaria vaccine in 2007. Image: Getty.

How do good ideas become reality? Solutions to complex problems do not come quickly. It takes an average of 10 years to take a vaccine from pre-clinical study to implementation, without counting years of basic research. Malaria, discovered in 1880, still has no effective vaccine. 

Political solutions are just as unpredictable. Fourteen years after the discovery of the Ozone Hole, the Montreal Protocol came into force to ban CFCs – yet, the government thinks it could take over 50 years to tackle air pollution by phasing out diesel cars. Many of the UK’s most endemic problems like flat-lining productivity seem destined to plague us for eternity. 

Solutions also unravel quickly, it took New Labour five years to reduce the number of rough-sleepers in England from 2,000 to under 500, but only six years for the Tories to let it shoot up to 4000 again.

A timeline of vaccine development. Image: Wikimedia Commons.

It is no wonder good policy is rare and slow. Policy need political and public buy-in, sustainable financing, monitoring and tweaking, and flexibility to adapt to changing environments and technology. 

There are places that appear to do policy better. Scandinavia balance a progressive welfare state with high taxation and public confidence. Likewise New Zealand, despite having one of the shortest democratic cycles in the developed world, manages to far exceed the living standards and prosperity of many western countries. What links them?

  • Population: Sweden has a population just shy of 10m. None of the other Scandinavian countries, nor New Zealand, top 5.6m. Fewer people makes it easier to put policies in place. They require less administration, less resource and shorter consultation periods.
  • Culture: Largely they are culturally homogeneous. Many studies show people feel more comfortable with state intervention, or redistribution, that helps people like them. New Zealand’s recognition of their bi-culture has a similar basis. 
  • Strong Executives: The New Zealand treasury maintains a core focus on living standards, providing checks and balances on a short-term political cycle that still allows for long-term prosperity growth. It’s something that evolves independent of National or Labour governments, recently bringing measures of wellbeing into their policy analysis. 

So can the UK replicate Finland’s start-up culture, or Sweden’s gender equality? How can Spain learn from Ireland’s reduction in unemployment, or Italy from Iceland’s banking recovery?

The answer lies in cities. Testing policy on their smaller populations, or areas can replicate the agility of smaller innovative countries. Testing also helps mitigate mistakes. Failure is magnified when policy is centralised and at scale. If cities or regions can prove policies work they can also act as a brake for those that don’t.

Take Universal Basic Income. In January 2017, 10 per cent of the Finnish unemployed population were contacted by their national welfare body to take part in a study on how a flat universal payment over traditional welfare payments affects job incentives. It’s telling that the study designers are worried about the small sample size, and statistical robustness not media reactions. Similar studies on different populations are underway in Utrecht and Kenya:  why couldn’t one by done in Edinburgh or Belfast?

The graduated process of pilots means governments can overcome the stumbling blocks of policymaking, be transparent about both the upsides and downsides of new policies, and give civil society or businesses opportunity to prepare for them. Matthew Taylor has spoken of how important this will be for any progress towards a Universal Basic Income in the UK.


Piloting will mean being willing to say when things don’t work. Universal credit was rightly trailed in London Boroughs like Hounslow, before nationwide roll-out – but evidence showed it led to food shortages and evictions. Instead of learning where the policy was failing, the Conservatives doubled down and centralised further. 

Cities will need more power to help the rest of the country. If London could model the effects of changing council tax boundaries, or new taxes on undeveloped land, many more could benefit from the evidence. But City Hall will need to be aware of the local dynamics behind outcomes. Lessons learnt in Chiswick might not apply in Chester: establishing the causes of success of failure will be vital. 

Testing policies in smaller areas also needs an effective mechanism over the top for sharing and spreading ideas. I’ve argued before how a more federal UK could help this. Long-delays to roll out ideas to other towns and cities could cause resentment and increase regional inequality.

Similarly good policy should flow as easily in countries as between them. Fora like the OECD have a role here, as do the C40. Networks of think-tanks and political grouping are also important but need greater involvement from those in power and not just activists or oppositions.

Pilots cannot be used as an excuse for those above the city level not to make decisions. Endlessly delaying roll-outs for more studies is a stalling mechanism that helps no-one. Access to 5G technology — now as important a service as water or gas — for example cannot be left to cities alone.

As well as their size cities have bountiful qualities to be at the forefront of policy research.

  • World-class Universities: Policies, like vaccine research also needs underlying basic research on problems to inform strategies further down the line. This means greater government-academic collaboration as policymakers have always championed between universities and industry.
  • Cultural Diversity: Policy development tends to be dominated by one style of thinking. Although it is improving, think-tankers, civil servants and political staffers tend to come from similar backgrounds and career paths. More artists, designers or scientists in policy-making could improve the willingness to test, learn, tweak and re-test: prototypes and beta versions just don’t appear in politics. Cities are full of innovators. 
  • Tech-Savvy: Policy testing gets harder as individuals become more and more connected. How do you isolate a section of the internet or the Internet of Things? The challenge is that it also becomes increasingly important, the use of AI in public services, driverless vehicles, and other emerging technologies will all need to be assessed rigorously and designed with pubic confidence and engagement at the heart of them. The concentration of knowledge in cities make them the perfect place to test digital tech for the rest of the country. 

Even in a world as changeable as 2017 there is still room in cities for experimentation.