Research report

Blueprint for investing in city deals: are you ready to deal?

20 Jun 2017
Description

If we want Australia to prosper then we need our regional cities to perform well. Australia has benefited from the growth of our big cities. But the growth and development pathway for our small cities is more challenging. Regional cities have the potential to produce $375 billion in output in 2031, cementing their 15 per cent contribution to the national economy. Putting this output in today’s terms, regional cities in 2031 will produce twice as much as all the new economy industries produce in today’s metropolitan cities. Sustained growth in regional cities will require locally tailored policies to drive small city growth. In our major cities congestion and settlement patterns constrain performance. Regional cities are now explicitly part of the Australian Government’s City Deals collaborative program, a cross portfolio, government investment approach with local flexibility. This Blueprint is about providing accountability and transparency in the Deal making process. It provides evidence based criteria and transparent processes for identifying a competitive City Deal. Experience from cities in the UK suggests that Australia’s regional cities will need to demonstrate clarity of purpose and commitment to change to be successful. This report provides a guide to all City Deal players - local, state and federal government and private businesses - to assist in the formulation of City Deal strategies in each of Australia’s 31 regional cities. First, are city economic growth engines ready? Cities need to be clear on how the City Deal will deliver national economic growth opportunities by improving the performance of the city’s economic engine. Australia’s regional City Deals should lift the quality of the Business Dynamo, which supports business innovation and growth, nurtures local specialisations and highly talented people, and builds the cultural and creative capacity of our regional cities. Each city has its own weaknesses, specialisations and strengths, therefore each Deal must embrace this bespoke investment approach. Second, are cities ready? The UK experience has shown that this policy is not for the faint hearted. City leaders need to be bold, innovative, coordinated and clear on the return on investment both for their cities and for national government. All players in a City Deal need to be clear on rules of engagement for a collaborative City Deal. Clear criteria on what makes a City ready is essential for efficient Deal formation. The consensus in the UK is that City Deals have helped cities to improve their economic strategies, to progress their plans faster than would otherwise have been possible, to establish robust and lasting partnerships with businesses and civic organisations, and to increase the likelihood that City Deals will result in significant and lasting impact. As Australia gears up to expand the City Deals program to regional cities across the country, there is an urgent need for clarity on the competition criteria and the Government’s ambitions for the quality of proposals, in order to generate quality bids and avoid time wasted on fruitless bids. Otherwise, our great small cities could lose out to big city funding options. Without all the players in regional City Deals being ready we know from the UK that failure is imminent. City Deals are most effecitvie when collaboratively negotiated with willing and ready cities. Therefore, city leaders must ask themselves. Is your city ready to deal?

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