Connective Capital Spillovers
Creating a seamless knowledge economy, Levelling Up the Arc and Making sustainable connectivity a regional priority
Infrastructure can be a powerful force in helping to unlock the economic potential of regions, supporting jobs and helping to rebalance the economy.
Creating a seamless knowledge economy
Transport infrastructure acts as the sinew of movement and communication within a regional economy. Any strategic long-term view of the Arc’s transport infrastructure has to recognise the importance of investment in this connective capital, and its potential to supercharge growth. Within the spatial dynamic of the Oxford-Cambridge Arc, strategic and concentrated infrastructure spending and development has the potential not only to supercharge the economic growth of already prosperous areas, but also to ensure that regional growth is managed equitably to include the fast-growing economies central to the Arc.
Compelling international evidence and analysis, from Spain to China to India, demonstrates that infrastructure projects produce a measurable growth in productivity and economic outcomes for manufacturing and research, on both a macro- and micro-economic level. Investment in connective capital and improving transport links not only allows for greater logistical efficiencies for the private sector, but also improves wellbeing as negative factors for individual productivity such as long, inefficient and expensive commuting can be considerably reduced. Direct government grants to businesses such as those provided by Innovate UK can help to provide crucial early stage capital for start-ups and spinouts, but a lack of decent infrastructure can act as a bottleneck to developments in a regional economy, with small businesses forced to choose between being constrained in their growth potential or relocation.
Improved transport infrastructure can act not only as an engine to drive the government’s Levelling Up agenda, not least in towns and cities like Milton Keynes, Bedford, and Luton, but also represent an example of how the public sector can play their part as a pillar of the ‘triple helix’ of private, public and academic collaboration which forms the basis of the Arc’s success. Major infrastructure projects are the monopoly of the private sector, and with the Autumn Budget announcing £6.9bn worth of investment towards train, tram, bus and cycle projects across the UK, we should look to see how this investment can create positive spillovers in areas like the Arc, where investment in connective capital adds more to the stock of connective capital than simply a new relief road or a new train station.
New empirical research conclusively supports the view that hiring for government supported infrastructure projects creates a significant number of private sector jobs in the rest of the economy… our analysis shows an emerging consensus that for every $1 spent on transportation infrastructure, the increase in economic growth is between $1.5 and $2.
Levelling Up the Arc
Improved transport links would ensure that rural areas of the Arc can better access services, and through the provision of commutable transport links would open up new avenues to employment in urban centres. It can alleviate the high cost of living in the Arc’s cities by allowing residential development further afield, offering job opportunities and a chance for greater economic prosperity in deprived parts of the Arc. In Wisbech, East Cambridgeshire and Fenland, for too long considered the periphery of other more prosperous urban centres in the Arc, faster and more reliable transport links with Cambridge, Peterborough and other Arc towns and cities would not just allow for minor efficiencies for the private sector but rather make a drastic and tangible impact on local communities, achieving the Levelling Up agenda and ensuring no area of the Arc is left behind.
The abiding lesson of infrastructure projects on the scale of Crossrail and HS2 is that investment in connective capital often creates spillover communities, as people flock to transport hubs that allow them to quickly access their places of work and study. Investment in connective capital has already allowed the growth of the Eddington community in West Cambridge, planned from its inception as the terminus for the connected University bus route, which incorporates university faculty buildings with Cambridge train station and the Cambridge Biomedical Campus. Operated by private sector business Whippet, and with the potential for British engineering firm Aurrigo to now operate autonomous shuttles in Cambridge, the scheme nevertheless runs in conjunction with the University of Cambridge with the cooperation of local authorities. It serves the needs of businesses at the Biomedical Campus, of students and academics, and of local people who need to access services like Addenbrooke’s Hospital. A passenger on a U-Bus might be an undergraduate on their way to lectures, a cutting-edge researcher at AstraZeneca, a resident of Eddington who commutes to London via Cambridge train station, support staff for the university or local hospitals, or those with limited mobility that cannot take advantage of the city’s cycling routes. We need infrastructure projects that consider the needs of all users, we can create a tide to raise all boats – through mutually-beneficial projects that consider the needs of local residents strategically and holistically.
It is important to ensure that everyone in the Arc, whether in towns, cities or rural areas, has the skills and opportunities to engage in our potential economic prosperity.
Making sustainable connectivity a regional priority
Historically the Arc has been the testing ground and the petri dish for thousands of inventions that have changed the way we live our lives. One of the trends of the last five years has been the growth of innovative micromobility solutions to the infrastructure challenges of dense urban centres. This is particularly true in an area with the architectural patrimony of the Arc, and those towns and cities designed largely around the medieval pedestrian such as Oxford and Cambridge rather than the needs of today. The success of micromobility trials including e-scooters and dockless bikes in Cambridge gives us an indication of how we can move forward with a more efficient, and crucially more environmentally sustainable, future for urban centres in the Arc.
Not only will it be provide 50 jobs, the collaboration between private sector provider Voi Scooters and the Cambridgeshire and Peterborough Combined Authority serves as an example of this innovation in personal transport. Likewise the Redways in Milton Keynes, shared-use routes for walking, cycling and scootering, have become the backbone of the city’s transport system – not only helping the local authority to meet sustainability goals by reducing single-person car use, but also taking advantage of the popular rediscovery of micromobility solutions during the coronavirus pandemic to improve individual wellbeing – from anyone from commuters to students to retirees.
The 2020 Global Infrastructure Trends Report from PwC underlined the need for the public and private sector to reconsider the potential positive spillovers of infrastructure: ‘rather than focusing on the lowest-cost option, companies need to apply a framework that considers the total economic, social, environmental and financial impact over the whole life of the asset’. Where connective capital spillovers occur, its after a holistic and strategic consideration of infrastructure wants and needs from across sectors. Development of the Oxford-Cambridge Arc gives central government and local authorities, working closely with private sector providers and operators, the opportunity to achieve so much in levelling up communities, supporting local business and unleashing the potential of the Arc. Connective capital is so much more than a train line or a bus route – it’s about providing communities and individuals with the means to fulfil their potential. In considering the infrastructure needs of the Arc, let’s make sure we go forward with that as our ultimate goal.
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