SOUTH WEST OF ENGLAND REGIONAL DEVELOPMENT AGENCY 
MINUTES OF THE 32nd BOARD MEETING 13 May 2002 
Sterling House, Exeter 
 
 
Present:

• Sir Michael Lickiss - Chairman
• Doris Ansari
• Nick Buckland
• Helen Holland
• Brian Kemp
• Mike Leece
• Alf Morris
• Robin Nicoll
• Timothy Parker
• Jeremy Pope Deputy - Chair
• Jonathon Porritt
• Colin Skellett
• Geoff Wilkinson - Chief Executive
• Suzanne Bond - Director of Strategy and Communications
• Caroline Bull - Director of Enterprise and Innovation
• Nick Lewis - Director of Corporate Services
• Colin Molton - Director of Development
• Melanie Farrant - Executive Office
• Simon Hooton Head of Policy - item 9 only
• Mark Gibson Director of Business Group Competitiveness, DTI - item 4 onwards

Apologies: 
Peter Chalke 
Nigel Costley 
 
 
1 MINUTES 
 
Minutes of the 31st meeting were agreed as a correct record. 
 
Matters Arising 
Jeremy Pope reported that the date of first closing date for the Regional Venture Capital Fund had slipped and that funds secured were £1.5m below the £25m sought; however, permission was being sought from the DTI for a first closing regardless of the shortfall. It was noted that other regions' county councils had been more supportive of RVCFs. The Chairman would update Derek Mapp, chairman of East Midlands Development Agency. 
 
2 CHAIRMAN'S REPORT 
 
Members noted the commitments of the Chairman since the last meeting. He explained more fully the ambitious large-scale National Institute for Research into Aquatic Habitats (NIRAH) project planned between Weston super Mare and Bristol.  
The Chairman reported that his meeting with Airbus UK had highlighted the competition between the European subsidiaries, and Airbus UK was seeking the Chairman's help in persuading the BAe board to establish a composite materials centre of excellence in the South West. 
 
The Secretary of State at DCMS was due to make an announcement later that day about the future of tourism. Her announcement would allow the background work already carried out to move forward. 
 
The Smith Institute event on 10 May in Bristol had been very successful with positive feedback for the RDA from both participants and ministers. Both the Treasury and DTI had stated their commitment to achieving change through RDAs. It was felt that it would be useful for the RDA to define the productivity gap in the south west better.  
 
Jeremy Pope reported on another event held on 10 May co-hosted by DEFRA and the Chamber for Rural Enterprise (CORE) in response to the Curry Report. This event had also been well received and the quality of debate was high. It had been agreed that the proposals in the Report needed to be dealt with as a whole rather than cherry picked, but acknowledged that this would be difficult because of availability of funds. It was also acknowledged that the South West was leading in responding to the report, and Jeremy Pope hoped this lead could be maintained. 
 
3 CHIEF EXECUTIVE'S PERFORMANCE REPORT 
 
As a report of performance statistics was not due at this meeting, the Chief Executive's report gave a flavour of work that the Agency had recently been involved in. He specifically referred to:

• the RAF Locking project which was going ahead in partnership with English Partnerships;
• the formation of Urban Splash's involvement with the regeneration of Royal William Yard;
• praise given at the recent Gloucestershire SRP meeting for the RDA's 10% contribution to a £2m project at Tetbury which had been the final piece of funding;
• the opening of Tolvadden Energy Park, and the encouraging take-up of units; and
• the Tripos project which had been signed and announced, and which was a good example of the RDA working in partnership with central government and local partners.

The Chief Executive also said that the Agency was working hard in the priority sectors including aerospace, - (the lean manufacturing initiative), and food and drink. 
 
Geoff Wilkinson confirmed that the Agency would be considering Robin Nicoll's suggestion that the Agency should investigate the means by which the SW could benefit from increased National Health Spending approved in the Budget. 
 
Four Heads of Operations had been recruited internally and a fifth appointed following a first round of external interviews. A second round of interviews was being arranged to fill the remaining two vacancies, which are in Somerset and Wiltshire/Swindon. 
 
A Cambridge MIT institute event to look at the regional agenda was taking place on 28-29 May and Geoff Wilkinson invited any board members interested in attending to speak to him about it. 
 
The Board issues day on 17 June will be held at Royal William Yard, Plymouth and Jane Henderson and Richard Bayly of GOSW would join the Board to talk about the role of GOSW and Objective 1 and 2. Geoffrey Wilkinson asked board members to advise him of any particular issues they would like to raise in these areas. 
 
The Chief Executive and directors then answered a number of board members' queries:

• The Board would be involved in the review of the Regional Economic Strategy. Over the next six weeks a consultation document will be sent to partners, followed by a series of consultation events mid-June to end-July. The Board will be invited to examine the process at the next meeting on 17 June, and would be fully consulted at the meeting on 29 July. Board meetings in September, October and November had been built into the review timetable when the Corporate Plan would also need to be updated and extended.
• The Renewables Sector Group had been set up under the chairmanship of Colin Skellett, and an Environment Manager was due to be appointed to work for the Agency. Establishment of the Renewable Energy Office and appointment of a manager was underway. Jonathon Porritt expressed his concern that work in this crucial sector was accelerated and the Board agreed.
• The lack of response in the budget to the collective RDA proposals was disappointing, but it was hoped that the outcome of the spending review would be positive for RDAs.

4 2002/03 BUDGET 
 
Since the report that had been circulated, the gross budget for 2002/03 had increased by £0.3m to £116.5m as the restocking debit for the DTI's central contingency fund had been reduced to £0.7m from £1.0m. The RDA chief executives had asked that the DTI only release monies from this fund with their agreement.  
 
Geoff Wilkinson explained the summaries of planned and committed expenditure. Approximately 90% (£105m) of the budget was already committed but this figure would be reduced through slippage. Core administration was budgeted at less than £5m, and considerably less than 5% of the total budget. 
 
In response to members' questions:

• On average during 2001/02 the Agency was understaffed by 10%. Reaching the full complement of staff and increased emphasis on revenue projects would result in a higher staff number than last year. The number of area teams had been increased from five to seven and each would require specialist and technical staff across the range of the RDA's work. Sector working groups needed to be properly staffed to drive work forward. Geoff Wilkinson confirmed that staffing numbers would, however, only be increased to the total of last year's complement. It was agreed that the breakdown of office and salary costs should also show numbers of staff.
• The allocation formula had disadvantaged the South West and the Agency would be arguing the case for the factors and weighting to be changed when the formula was reviewed later in the year. However, there would only be changes if the overall funds available for RDAs were increased and this would not be known until the outcome of the spending review.
• A quarterly review process had been introduced to manage allocation of project funds against the Corporate Plan themes.
• Presentation of spending needed to fully reflect the overlap across the Corporate Plan themes. This was particularly important for the Annual Report and Accounts.
• It was suggested that additional funding from DEFRA should be sought if the South West was to lead on the Curry Report recommendations.
• Projects under single pot funding were being monitored individually against EU state aid rules through the appraisal process.

5 MAJOR DEVELOPMENT PROJECTS REPORT 
 
In addition the information reported in the paper that had been circulated with the agenda, Colin Molton added that the Tripos project had been a great success and valuable experience for the RDA. Geoff Wilkinson outlined the role of DTI and the Industrial Development Advisory Board in securing this deal. The RDA was working with English Heritage on the development of St Austell town centre. An extensive report on developments at Royal William Yard would be made to the Board at their meeting in June. The arrangement with English Partnerships for RAF Locking would bring substantial additional funds into the region. Doris Ansari noted that the deal with Borders Books had recently been signed. 
 
6 ENTERPRISE AND INNOVATION : BOARD UPDATE 
 
A full report had been circulated. Jeremy Pope added that Sainsbury's had recently agreed to sponsor a second group of "student businesses" to develop links in food and drink supply chains. Caroline Bull would take forward the suggestion that the composite materials work be broadened across other sectors than aerospace. 
 
As the forthcoming Regional Assembly Select Committee was examining skills and learning, Caroline Bull reported that each board member who sat on a local learning and skills council would be given a briefing report on the RDA's work in this area. 
 
7 REGIONAL SELECTIVE ASSISTANCE 
 
A report had been circulated setting out the RDA's assumption of responsibility for Regional Selective Assistance (RSA) with effect from 1 April 2002. How to secure the involvement of the South West Industrial Development Board early enough to overcome potential problems was considered. Due to confidentiality of papers and the volume of information prior to appraisal Mike Leece suggested this would be very difficult to achieve. The regional RSA allocation of £3.6m to the South West to cover £5.4m of planned projects. This took account of anticipated slippage and was based on historical evidence. Nick Lewis explained that any funding requirements above the £3.6m allocation could be vired from elsewhere in the single pot budget if necessary and this would probably be required if any further RSA projects requiring payments this year were approved. 
 
8 LONDON TO SOUTH WEST AND SOUTH WALES MULTI MODAL STUDY (SWARMMS) 
 
Colin Molton introduced this item and explained that the study had examined road and rail transport principally between London and the region. The RDA supported the rail proposals, including the proposals for major improvements to the Exeter to Waterloo service. The provision of alternative rail and road corridors to the Great Western line and M4/M5 route are vital elements in the measures required to achieve sustainable economic growth in the region. In this respect, the dualling of the A358 from Ilminster to Taunton was not seen as an effective alternative route between the M3 and the A30 in Devon and Cornwall. It would not sufficiently reduce the region's reliance on the M5. This would require the dualling of the A303/A30 even through the Blackdown Hills. The A303/A30 route would also support the growth of Exeter as a Principal Urban Area and provide an important link for road based traffic flows form the north via the A34 and from the south coast via the A35.  
 
The A358 option, recommended in the SWARMMS report, would not achieve these objectives, although improvements to this road are required to support the growth of Taunton as a Principal Urban Area. 
 
A further issue for the RDA was congestion around Bristol. This was recognised in the report and GOSW would be taking responsibility for further work. Both the RDA and the local authorities in former-Avon would co-fund this with GOSW.  
 
Board members were asked to pass any additional points in response to the study's recommendations to Colin Molton so that they could be considered by the Board Infrastructure Advisory Group. 
 
The Board endorsed the position set out in the paper (SWRDA (02)35) on the requirement for effective alternative rail and road corridors. 
 
9 POLICY BRIEFINGS SYSTEM 
 
The need for board members and staff to have a clear understanding of policy positions had brought about the development of a policy briefings system. This would capture knowledge across the Agency and provide up to date information. The system was set out by Simon Hooton. Board members could have access either via the Agency's intranet or through the Executive Office, but it was planned the system would be available through the website in the long term. To ensure consistency and accuracy, briefings would go though a checking system. 
 
The system was welcomed by members who asked for an update report and demonstration at the end of the summer. 
 
10 UPDATE ON MARKETING CAMPAIGN 
 
The paper circulated with the agenda was noted. The group of board members advising and guiding the campaign had met that morning and Suzanne Bond thanked them for their input. 
 
11 STANDING ITEMS 
 
a) Projects Approved 
Noted. 
 
b) Executive Reports 
The directorate reports were noted. The RDA's relationship with SRPs and LSPs would change according to how these partnerships evolved. Although the RDA's delegations to SRPs for the current year would be the same as 2001/02, differences would emerge by the year end depending on the local approach.  
 
Suzanne Bond confirmed that Culture South West would fund the executive director post located in the RDA's Exeter offices. 
 
c) Policy Consultation Responses 
Noted. 
 
d) Summary Minutes of Board Advisory Groups 
The summaries were noted and the layout welcomed. It was agreed that a mechanism for sector groups to report their work to the Board was needed. Helen Holland invited her colleagues to the Urban Action Plan Workshop to be held on 8 July in Exeter. Details are available through the Executive Office. 
 
e) Decisions taken using urgency procedures 
Noted. 
 
 
f) Documents sealed 
Noted. 
 
g) Loan write offs 
Noted. Although loans were inherited from the Rural Development Commission, the RDA worked with solicitors to recover any debts. The Chief Executive was authorised to write off debts of less than £25,000; the Director of Corporate Services was authorised to write off debts of less than £10,000. The residual loan book stood at £0.65M. 
 
12 RESPONSE BY MARK GIBSON, DTI 
 
Mark Gibson cautioned the Board to be realistic in their expectations of the spending review. The Government's focus was on health, education and transport. However, within the DTI RDAs had a high profile. The capital/current issue needed to be properly addressed, and the DTI would be encouraging the Treasury to increase current funding. 
 
The RDA funding formula was not in any way political, and Mark Gibson assured the Board that the DTI would examine it objectively. SWRDA should seek to influence the basis of the formula. 
 
Mark Gibson complimented the quality and brevity of the board papers and said that the SWRDA was perceived as effective, delivering results and involved in worthwhile projects. 
 
The Chairman thanked Mark Gibson for joining the meeting. 
 
13 DATE OF NEXT MEETING 
 
Monday 17 June at Royal William Yard.