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Devon commits £6 million to covid support

Thursday, 15 October 2020 13:16

By Daniel Clark, local democracy reporter and Radio Exe News

16,400 people expected to lose jobs

A £6 million economic recovery programme has been approved for Devon to form part of the county council’s response to the covid-19 pandemic.The money is for the county council area, which excludes Plymouth and Torbay. A study has found that 16,400 are expected to lose their jobs in the country council area (5.4 per cent), but under a more pessimistic scenario is could be two or three times this level, with the economy not returning to pre-covid levels until 2035.

Devon County Council’s ruling cabinet heard that the county’s economy has shrunk by eight per cent, unemployment has risen to above six per cent and claims for universal credit have surged.

The crisis has had a significant impact in tourism and hospitality, retail, construction and manufacturing with high levels of youth unemployment and rising levels amongst the over 50s. But other sectors, such as digital, health and care and clean growth, are showing signs of healthy recovery and new growth since the downturn.

The cabinet unanimously agreed to set aside £6 million over the next three years, in addition to other bids for Government support.  It will be used to provide support in four key areas: small and medium enterprises, employment and skills, the green recovery and the hardest hit towns and communities.

Devon County Council leader Cllr John Hart said: “Clearly we are still in a battle with coronavirus as the rising number of cases in Exeter has shown, but rates across the rest of Devon remain low and we must all pull together to keep it that way and to keep people healthy and safe. But we also have to take urgent steps to address the economic health of our county, our communities and our people and to plan for the future.

“This is right for Devon and as long as we can afford it, we will get on and do it. We have to keep the economy of Devon going as we have little help.”

Devon’s cabinet member for the economy, Cllr Rufus Gilbert said the exact measures would depend on how the pandemic developed but would include supporting businesses to become more resilient and improve their digital skills, targeting key sectors such as tourism, retail and health and care, helping hospitality businesses to improve the skills of their workforce, supporting farmers to diversify, improving skills and training, stimulating new business start-ups and supporting individuals with redeployment and employment support. The council would work with district and town councils to develop proposals for urban renewal in the hardest hit areas.

Keri Denton, head of economy, enterprise and skills, in her report to the meeting said that a national report assessed Devon as the fourth most vulnerable county in England to the economic impact of covid-19, and that every district, except Exeter, was more vulnerable than the England average.

Devon’s analysis shows the 10 most vulnerable places in the county were Central Barnstaple and Forches, Central Newton Abbot, Central and West Ilfracombe, Teignmouth town centre, Central and South East Bideford, Totnes town centre, Dawlish town centre, Lynton and Lynmouth, West Dartmouth and Exmouth town centre. The analysis takes into account household income, skill levels, unemployment and other deprivation and recognises there were significant vulnerabilities before the pandemic.

In her report, Mrs Denton said: “The covid-19 pandemic has and continues to have significant impact on the Devon economy, its businesses, communities and workforce. UK economic performance is currently expected to return to pre-covid-19 levels by 2022, but recovery however will not be at the same pace everywhere, with gaps already starting to emerge across the County.

“These include significant impacts on the tourism and hospitality, retail, construction and manufacturing sectors, as well as high levels of youth unemployment, and in the latest claimant count figures, a rise in worklessness amongst those over the age of 50. Similarly, market and coastal towns are also being disproportionally affected where there is a stronger reliance on some of the above sectors, and / or a reliance on self-employment.

In her report, she said the council had commissioned Oxford Economics to forecast potential outcomes for the area. In terms of employment, under the baseline scenario, the model predicts a reduction of 16,400 jobs and an in increase in the unemployment rate from three per cent to 5.4 per cent in 2020 and while growth was forecast to resume towards the end of 2020, the model predicts the Devon economy would not return to 2019 levels of productivity and employment until 2022.

She said that the same model was also used to run a more pessimistic forecast. “This indicated that, in the event of a slower recovery, the county would experience a total loss of productivity of almost 13 per cent and an unemployment rate rising from three per cent to 8.7 per cent,” she said.

“In this scenario, the economy would not return to the same levels of productivity until 2026 and to 2019 employment levels until beyond 2035. In both scenarios the impact of leaving the EU under World Trade Organisation terms was also considered, reducing, productivity by a further two per cent.”

She said that while Exeter’s economy is showing signs of stronger resilience to the down turn, in part due to its high levels of public sector employment and strong knowledge economy, districts such as North, Mid Devon and West Devon fare less well.

The £6 million over the next two to three years is proposed to be allocated as follows:

Small and Medium Business Support Package – circa £1,560,000

This package includes assistance to businesses to adapt their business models through a digital business support programme, helping enterprises to become more resilient and respond to the impacts from the pandemic.

A focus on rural and micros businesses and key sectors such as tourism, retail and heath and care will be given. This activity will work alongside some of the skills package of measure to improve digital skills.

A Made in Devon Scheme is proposed, building on the Buy with Confidence Scheme operated by Devon, Torbay and Somerset Trading Standards including a campaign to promote buy local. Initially this scheme will focus on the food and drink, tourism and the creative industry sectors. The programme will create a sense of pride in our high-quality products and services and celebrate Devon talent.

 

Employment and Skills Support Package – circa £1,650,000

This package aims to help young people and adult workforce secure and retain employment. It would include Bright Futures – additional careers activity across secondary schools through the Councils Career Hub with a focus on Year 10 and 11 students impacted by the education gap last year and a Redeployment Training Programme for those leaving work or seeking to re-skill into a higher value sector.

A Hospitality Upskilling programme to directly support the hospitality sector workforce to improve workforce skills and create new roles across a range of areas, including catering, customer service and gain/improve new skills and competencies such as digital capabilities would also be part of the program.

 

Opportunities Support Package – circa £1,450,000

A range of initiatives to stimulate new business start-ups will be undertaken, recognising the growth opportunities that exist, and to help individuals back into work.

 

Places and Communities Support Package – circa £1,050,000

This package focuses on the hardest hit communities where a programme of activity will be developed jointly with district and town councils. The programme will seek to develop urban renewal proposals for 8 of our hardest hit towns, focusing on new development opportunities and re-purposing high streets. Complementing this will be investment in 10 additional work hubs and piloting 3 live/work hubs, including one in Exeter.

 

Capacity Building and Resourcing – circa £290,000

A small element of funding will be set aside to improve delivery capacity and the resilience of our key business networks.

 

The packages will seek to achieve over the next two to three years:

Support 385 businesses to take up digital solutions
Support 480 businesses to adapt their business practices
Deliver a new Green Business Directory and Tool Kit
Provide 2500 individuals with redeployment and employment support
Support 500 additional apprenticeship places for adults and young people
Deliver 700 new level two training places
Deliver 250 new level three training opportunities
Support 500 start-up businesses to launch.
Engage 100 young people in start-up opportunities and create 20 new ventures
Engage with 90 social entrepreneurs and create 40 new social enterprises
Support 150 farms to become more resilient
Establish 300 members in Made In Devon programme
Creation of 10 additional work hubs Establish 2-3 natural capital innovation pilots
Create 8 Urban Renewal Plans for our hardest hit towns
Support up to 20 communities develop local energy networks
 

Supporting the measures, Cllr Rob Hannaford, leader of the Labour group, said that the substantial investment of £6m was needed as "we don’t want mass unemployment and a huge amount of misery for people," but said that more support from central government was needed to get through the pandemic so we have an economy that is fit for purpose when it ends.

Cllr Alan Connett, leader of the Liberal Democrat group, added: “This is a crisis for Devon and so I am pleased Devon County Council is bringing forward this programme. People have lost their jobs, losing their jobs, and worried about paying rent, and there is so much agony out there. The biggest thing we can do is support the economy and supporting Devon is the only game in town.”

The cabinet unanimously agreed to consider supporting an Economic Recovery Programme of £6 million over the next 2-3 years, as part of the 21/22 budget setting process.

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