Glasgow looks to the future

“Glasgow, you were pure dead brilliant.” The words, uttered in the best Scottish accent Prince Imran of Malaysia could muster as the curtain came down on last summer’s Commonwealth Games, were almost as memorable as the Commonwealth Games Federation president’s prolonged struggles unscrewing the Queen’s Baton 11 days earlier. Between the Games and the MTV awards at the Hydro three months later, one in three of the world’s population are said to have had their eyes trained on Glasgow via television.

The city has undoubtedly transformed itself in the last few decades. It now has the highest concentration of employment in renewable energy nationwide, engineering is considered incredibly healthy, life sciences have built a strong base – epitomised by the £842m South Glasgow University Hospital set to open this May – and universities continue to climb the research rankings. “All of that just feels like there are positive steps being taken forward for this part of the world where previously, almost exactly 20 years ago, you would look at Glasgow’s economic figures and you would have basically thrown yourself off a tall building if you could have found one,” says Stuart Patrick, chief executive of Glasgow Chamber of Commerce.

Though the city may have gleaned the greatest exposure these past 12 months, it cannot be considered in isolation. “People are not daft, they realise the focus of these types of things will be the city, but the interdependence between the city and its hinterland is such that a lot of people work in the city but don’t live in the city,” says Stuart Tait, who manages Clydeplan, a team tasked with delivering a Strategic Development Plan setting out how the Glasgow and Clyde Valley city region should develop over the next 20 years. Eight local authorities – East Dunbartonshire, East Renfrewshire, Glasgow City, Inverclyde, North Lanarkshire, Renfrewshire, South Lanarkshire and West Dunbartonshire – make up the region, covering a third of both Scotland’s population and its economic activity. “They all have their own local agendas, they all have their own aspirations of course,” says Tait. “But they recognise that if you don’t get the core right then it would be very difficult for them individually to sustain a level of activity in their own areas without a strong centre.”

Research published by Oxford Economics (OE) last April estimated the city region is expected to grow by 2.6 per cent in the next decade, contributing almost a third of new Scottish jobs. However, the OE report, which was commissioned by Clydeplan, suggested the city region will not regain pre-recession peak levels of employment until after 2038 at the earliest, with four of its eight local authorities experiencing lower total employment in 2012 than in 1991. Development activity feels a “bit piecemeal” at present across the region as a whole, intimates Tait, noting that housing completions, for example, are down to less than half the 7,000 they once were each year. 

In the time since that OE report, though, the region’s eight local authorities have signed a much-lauded £1.13bn City Deal, which, over its 20-year lifespan, promises an estimated 29,000 new jobs. “Collectively, the ability to work together and to deliver a series of projects over the next five, ten, fifteen, twenty years, which wasn’t there up till this time last year, has really got the authorities galvanised, I think, in terms of we can [now] do much more to support the city region agenda through this mechanism,” says Tait. Twenty infrastructure projects, including the Glasgow Airport Rail Link as well as the Clyde Waterfront and Renfrew Riverside, are to be funded via the first agreement of its kind outside of England.         

“The period of successful regeneration is complete in Glasgow,” city council leader Gordon Matheson states confidently. “2014, and specifically if you go for one major event it would be the Commonwealth Games, marked the completion of that period of our transformation. The next phase is the expansion, the growth of Glasgow as a powerhouse economy, and that requires the enthusiastic pursuit of the cities agenda by central government at both Edinburgh and London levels. The purpose of that is to net grow the economy and to tackle ingrained inequalities, that’s the phase that we’re at and that is the outcome, by which I mean the elimination of poverty. We must set ourselves that target.”   

It was with this in mind that leaders of nine of the UK’s largest cities outside London joined Matheson in Glasgow this month to launch a freedom charter setting out demands for further devolution of powers beyond national parliaments. “The transfer of powers simply between London and Edinburgh is not a devolution which interests me,” says Matheson. Powers on welfare, job creation, transport and further education, to name but a few, should be devolved to local authority level, he says, calling for Skills Development Scotland to be scrapped and Scottish Enterprise to be significantly reformed with its functions scaled back. “I don’t know quite how to break this to parliamentarians: they don’t create jobs, cities create jobs,” he says.

Amid latest figures which put the jobless total in Glasgow at 9.2 per cent – far outstripping a Scotland-wide figure of 5.7 per cent – Matheson claims national programmes are “blunt” in terms of tackling inequalities within the city. “The Work Programme is one standout example which simply has failed in terms of what it aims to deliver,” he claims. “Give us control of it, we will align it with our economic strategy which has been developed by an independent commission which was industry led. We will then align it with the sectors where there is growth but also with the initiatives that we have led as a city.”

Those initiatives fall under the umbrella of the Glasgow Guarantee – a promise to provide everyone aged between 16 and 24 with support in the form of an apprenticeship, training or work – which has found Modern Apprenticeship places for almost 3,600 school leavers, employment for 784 graduates and 917 previously unemployed residents, as well as jobs for a further 321 aged under 20. “It is one of the measures that the council has done as much as you could realistically ask them to do,” says Chamber of Commerce chief executive, Stuart Patrick. 

Larger companies are beginning to make their contribution, though smaller and medium-sized enterprises still require persuasion, he intimates. “A lot of SMEs felt that the management, not just the management of the young person but the management of the system of support, was too much for them to be bothered with and a lot of them haven’t really got over that view yet. I think part of the real solution is to find ways of reducing the risk for small companies to make their contribution; there are clearly some that have but I think there is a much wider range of smaller companies that could make their way forward.” For Patrick, the more “fundamental” development has been a rise in school attainment rates in light of the polarised skills profile Glasgow has. According to last month’s Centre for Cities outlook report, Glasgow has the eighth highest proportion of highly skilled residents combined with the 12th highest share of residents with no formal qualifications when considering the 64 largest cities and towns UK-wide.     

One thing within Matheson’s gift has been the living wage, which was launched six years ago next month and is set to rise to £7.85 per hour within the next few weeks. In November, he announced council procurement policy would be changed to give employers who pay the living wage a “material advantage” while those who wish to take up wage subsidies flowing out of the Glasgow Guarantee must sign up. “I recognise that, in certain sectors, in certain companies, it’s more of a challenge than in others,” says Matheson. 

“But then there are business advantages too… you’re in a moral contract with an employee as well and surely that means that you’re going to pay a decent wage. The other reason why it’s bluntly compelling is businesses, generally speaking, are instinctively in favour of low tax, so we’ve got a community that wants the state to retrench while at the same time expects the state to heavily subsidise low pay through, for example, tax credits. Now at a time of austerity, when we’re paying down the national debt and so on, it is necessary for business to take more of a responsibility. You can’t hope for a smaller state and expect it to subsidise your low pay. Let’s as a society become increasingly intolerant of that.”

The number of employers directly engaged with is estimated at 130 – a small proportion of the 15,320 enterprises registered in Glasgow city last year – with a combined workforce of close to 50,000. That said, the business community’s tone does seem to have softened. Patrick admits to a tendency up to now to simply say the business community would dismiss the measure as additional costs. 

“We do have some members… for whom the living wage would, frankly, be anywhere up to a 15 to 20 per cent increase in their salary bill,” he says. Even so, firms at the other end of the spectrum consider it “part of the deal of demonstrating that they’ve got a genuine commitment to the role of the workforce in the delivery of their returns”. 

Against this backdrop, then, the Chamber announced last month its plans to carry out a review of the impact of the living wage with its members. “I think the Council of Directors here are minded towards it,” he tells Holyrood. “But they want to understand what the implications would be for the full membership. I think they may be coming forward with proposals that are not simply as blunt as saying it’s a set wage rate. So we have to test out all the possibilities here.”

Tomorrow: Co-chair of Glasgow's Poverty Leadership Panel, Ghazala Hakeem, on listening to the experts