[ Last Updated 30 August 2006 ]
Short Description
The government is to refresh its regional economic development policy to boost even further its impact on the national economy and on kiwi exporters' success offshore, Economic Development Minister Trevor Mallard announced today.
Author
Hon Trevor Mallard, Minister for Economic Development
The government is to refresh its regional economic development policy to boost even further its impact on the national economy and on kiwi exporters' success offshore, Economic Development Minister Trevor Mallard announced today.
"Regional economic development initiatives to date ensure we now have a solid base of networks, skill, talent and economic success to build on as we bring the policy up to date with the changes that have occurred over the last six years," Trevor Mallard said.
"The Regional Partnerships Programme that began six years ago is now operating in a different environment. The regions, which were originally a focus because they were lagging in terms of jobs and economic growth, are now showing good growth and in many cases are now beating the main urban centres.
"There have also been significant changes in government policy, and we now need to align our regional economic policy with the wider range of government programmes and services that are delivered regionally, from skills and training, to labour workforce support.
"Changes to the Local Government Act have also provided much greater scope for communities to set their regional priorities. All of this, plus our growing understanding of the constraints on the economy from a national perspective, means it is essential that we bring our regional economic development policy up-to-date with today’s environment.
"In particular, as part of our commitment to raise living standards through transforming New Zealand into a high-wage, innovative and export-led economy, we need to support the growth of more firms that can successfully compete in international markets.
"There is no doubt that the Regional Partnerships Programme and its Major Regional Initiatives (MRI) component have taken the regions from strength to strength. We have seen improved strategic thinking, and collaboration and linkages and the development of projects which have built on regions’ strong points.
"It is time now to take a fresh look at what we can do to move regions to the next level so as well as supporting the local economy, they can help New Zealand make even bigger impacts in the global marketplace."
Proposed changes to regional economic development policy focus on achieving greater scale and greater collaboration to drive growth, with regions continuing to drive their own growth. They include:
- Consolidating the 26 regions established under the Regional Partnerships Programme for funding purposes to about 14 larger areas
- Concentrating funding on building the capability to develop substantive regional economic development strategies
- Contestability of large scale funding under the Major Regional Initiative programme
How does the Regional Partnership Programme work?
The Regional Partnership Programme is the government’s principal regional economic development programme and gives regions guidance and funding to develop and activate sustainable economic growth strategies.
It provides grants for three activities: strategic planning (up to $100,000 every three years); building the economic development capability of regions (up to $100,000 per year); and Major Regional Initiatives (up to $2 million every three years).
The programme helps each region to develop an economic development strategy identifying their key strengths.
Each region's strategy has been developed by "communities of interest" working together for sustainable regional economic growth. The key to the programme has been cooperation between these groups – which include local government, business representatives, iwi, economic development agencies, educational institutions, community organisations – and central government.
Each region has an administrative agent who contract manages projects that are funded under the programme and these agents are often local economic development agencies or local councils.
Why is a move to fewer regions being proposed?
International evidence suggests that for regional economic development to happen effectively a certain level of scale or mass is required.
What do the proposals mean for the three funding streams under this programme?
Contestability is proposed for the Major Regional Initiatives which will mean each will be weighed up against projects from other regions. This will enable government to focus investment on the highest priority projects supporting the transformation of the national economy.
Strategic planning and building the economic development capability of regions remain a critical part of the programme, and will still be available for all regions. It is proposed they will have minor changes aimed at improving them.
What happens next?
We would like regions to give us feedback on the proposed changes - through the Ministry of Economic Development and the regional advisors of New Zealand Trade and Enterprise. Officials from these agencies will also be undertaking some visits around the country to hear views. It is expected that detailed operational changes will be decided at the end of 2006, including the transition process. The final process of changes could take up to two years.