Published: 4th Nov 2015
shipbuilding small
The soon to be demolished and removed cranes at what was the Swan Hunters shipyard on the River Tyne.

The decline of manufacturing and the impact of public sector cuts are creating a perfect storm in Newcastle’s marginalised areas. Can the city forge a new vision that goes beyond municipalism and industrial growth?

As Newcastle was negotiating the sign-off of the region’s £1.5bn devolution deal last month, a group representing civil society and small businesses in the city was planning its own collaborative deal.

The fifth ‘Activating Local Alternative Economies’ event took place in Newcastle in mid-October, bringing together representatives from the small business sector, and from community and health organisations and the arts.

Devolution will bring much needed funding to the region but the jury is out on how much of that funding will reach into deprived communities and re-build a vision for the region’s prosperity.

Newcastle has been audible and public about the impact of ‘impossible’ public sector cuts on the city. It slashed almost its entire arts budget and plans to cut a total of £108m from city spending by 2017. Leader of the council Nick Forbes told New Start, ‘The government’s ongoing austerity programme has been extremely difficult for Newcastle and is likely to be very challenging in the coming years.’

‘The city has lost its sense of vision, as public

sector leadership gives way to growing fragmentation’

For a city that has been heavily reliant on the public sector and municipalist in its outlook, the blow has been particularly deep. On top of public sector cuts, Newcastle is reeling from the closure of the Northern Rock Foundation, which provided philanthropic capital for the region’s civil society, making £225m worth of grants in the area between 1998 and 2014. And as a city that symbolises heavy industry more perhaps than any other UK city, the decline of its shipbuilding and other manufacturing businesses has left a deep scar.

It is not only funding and jobs that have been lost through the double whammy of austerity measures and industrial decline. Those who attended the event talked passionately about the impact of cuts on local communities, but also about the way that the city has lost its sense of vision, as public sector leadership gives way to growing fragmentation. Networks that had previously provided a channel for people to come together and discuss local issues – from local strategic partnerships to regional development agencies – have fallen victim to cuts or public sector reorganisation. Many voluntary and community sector organisations that provided support are struggling with increased demand and a fall in funding, and cross sector working and understanding has fallen away.

‘What keeps me awake at night are the growing numbers of poorer working people and the lack of ways to hold creative conversations around solutions’, one delegate said.

As Gillian Hewitson – chief executive of skills and employment partnership Newcastle Futures – points out elsewhere in this edition, face-to-face collaboration has become a luxury. And the partnerships that now exist – local enterprise partnerships and the combined authority – are more narrow in their focus, delegates said.

So can local organisations work together more closely not only to fill the gaps left by funding cuts but also to create a new vision for their city?