Explicit recognition for Midlands 'long overdue', says expert, as regional strategy published

The 'Midlands Engine Strategy' outlines planned projects in the region that will benefit from the government's Local Growth Fund and other funding streams. These include a 'global hub for space technology' in Leicester, targeted transport improvements and a 'Midlands Skills Challenge' to improve the employment prospects of people living and working in the area.

Real estate expert Tom Johnson of Pinsent Masons, the law firm behind Out-Law.com, welcomed the publication.

"It has been long overdue for the 'Midlands Engine' to receive the explicit political recognition and support that it deserves," he said.

"However, there will need to be further and more significant investment across the issues identified around low productivity and skill levels, connectivity, exports and infrastructure to really make a substantive difference. The story doesn't stop here," he said.

"It's also timely that this strategy is issued just before MIPIM 2017 gets underway in Cannes this week, which will include very strong representation from the Midlands across the public and private sectors, with a number of major schemes and investment opportunities being launched," he said.

The Midlands is home to more than ten million people and accounts for 13% of the UK's annual economic output, as well as being home to a number of "globally significant businesses" including Jaguar Land Rover, JCB and Rolls Royce, according to the strategy document. From May, Birmingham and the West Midlands Combined Authority area will have its own directly elected mayor, while the area will also be "at the heart" of the UK's planned national high speed rail network, HS2, according to the strategy.

However, the region's economy has been "falling behind" in recent years, with a 15% productivity gap between the Midlands and the UK average as of 2015. There are three main reasons for this, according to the strategy: a shortage of skilled workers; a "fragmented" local economy made up of a number of "small, poorly connected areas"; and a "lack of entrepreneurship and economic dynamism" in the form of fewer businesses being created in the region than the UK average.

The strategy proposes to address these issues through a combination of targeted Local Growth Fund investments and national policy, including the sector-specific support set out in the government's industrial strategy and the reforms to technical education announced in the Budget.

The newly-announced £392m in funding comes on top of £1.5 billion worth of Local Growth Fund investments already announced for the Midlands region, and incorporates £105.4m worth of new spending on transport and infrastructure projects. The biggest investments included in the strategy include £25m to tackle congestion and improve access to areas of employment around the Black Country region; £25m for transport infrastructure in Coventry and Warwickshire; and £12m investment in transport connections around Loughborough.

The strategy also proposes to set up a 'Midlands Trade and Investment Programme', which will promote the Midlands as an area for potential investment to the world. The programme will include events in Europe, North America, Asia, Africa and the Middle East, and a "portfolio" of potential investment opportunities will be published later this year.

New regional transport body Midlands Connect, which was set up to identify the transport improvements necessary to unlock the growth potential of the Midlands, has also published its first strategy document (72-page / 14.5MB PDF). Its early priorities will include the 'Midlands Rail Hub' project, which will allow up to ten extra trains an hour through central Birmingham; packages of road improvement works along the A46 and A52 transport corridors; and a focus on "intelligent connectivity". This could involve smart and digital travel applications, and trials for connected passenger and freight autonomous vehicles.

Midlands Connect has been allocated £17m in government funding over the next three years for the planning and design work associated with its early priorities.

Chancellor of the exchequer Philip Hammond described the government strategy document as an "important milestone".

"The Midlands has enormous economic potential and it is more important than ever that we now build on its existing strengths to make sure it fulfils it," he said.