Agenda item

Briefing Note of the Director of Business, Investment and Culture

The Business, Economy and Enterprise Scrutiny Board (3) received a briefing note regarding the support the Council had been giving to businesses and how the Authority had worked alongside local business support partners including Coventry & Warwickshire (CW) Chamber of Commerce, CWLEP Growth Hub and Coventry & Warwickshire Reinvestment Trust (CWRT) to adapt the business support offer to changing economic, social and health conditions and ensure local businesses were supported through the COVID-19 pandemic.

The nature of support services provided to businesses had changed due to changing economic circumstances.  Coventry & Warwickshire entered 2020 as the fastest growing LEP area economy in England since the 2008/09 recession in terms of economic output.  However, the COVID-19 outbreak in March 2020 forced some sectors of the economy to close and social distancing restrictions limited the output of sectors remaining open.  The impact had been severe, with UK economic output (measured by GDP) falling by over 21% in the first two quarters of 2020 alone and contracting by 9.9% in 2020 as a whole (the largest contraction of any G7 nation).  The West Midlands encountered the highest fall in economic output of any English region during the Spring 2020 lockdown, and the UK economy remained 7.4% smaller than pre-pandemic levels.

Due to many businesses needing to close temporarily and/or unable to generate sufficient income, some 49,200 posts in Coventry were furloughed in June 2020 (30%) and the claimant count (numbers on unemployment related benefits) in Coventry increased to 16,695 (6.7%) in October 2020.  Because of the cashflow challenges facing many businesses and the need to minimise further job losses, business support activities had broadened in 2020 to support local businesses to access Government grants and loans to mitigate against the impact of COVID-19 and help ensure their survival, as well as continue delivery of our business support programmes and Inward Investment service.

The Economic Development Service (EDS) worked to deliver the aims of promoting the growth of a sustainable economy and improving the quality of life for local people.  Coventry’s businesses play an integral role in creating wealth and employment.  There were nearly 10,000 businesses in Coventry, many of which were Small or Medium Enterprises (SMEs), which create significant employment opportunities and contribute to local business rates.  The Service had remained active in ensuring that local businesses (particularly SMEs) were given the best chance of succeeding with the support available. Coventry’s SMEs continued to need advice, access to finance and infrastructure, and support to fulfil their growth potential. 

The briefing detailed the ongoing support for businesses which this year included COVID-19 support and EU Exit and Funding of Business Support.  Officers discussed furlough, EU funding programmes, grants and anticipated future announcements.

The Board questioned officers, received responses and discussed the following issues:

·  The Apprenticeship Levy and LEP’s

·  Level up funding

·  Promoting benefits of how being the City of Culture has supported the local economy using Key Performance Indicators 

·  Freeports and their competitiveness

·  Furlough

·  Brexit

·  Support for BAME communities 

The Cabinet Member for Jobs and Regeneration assured the Board that he had participated in regular briefings about grants and Coventry had worked hard and been successful in supporting businesses through the pandemic.  He discussed changing government policies, furlough, freeports, Brexit and impacts of being the City of Culture. 

The Board requested further information regarding

•  discussions with the LEP to encourage diverting Apprenticeship Levy funding if it cannot be spent by individual businesses

•  the Levelling Up fund and the Shared Prosperity fund

•  government policy on Freeports and what this means for Coventry

The Board requested that as there had been significant investment into the City of Culture, Key Performance Indicators on jobs and businesses should be available to scrutiny.

RESOLVED that the Business, Economy and Enterprise Scrutiny Board (3) requested further information regarding Apprenticeship Levy use, Levelling Up Fund and Shared Prosperity Fund, Freeports and City of Culture Key Performance Indicators on jobs and businesses.