The LCR Innovation Zone Programme Management Board met to discuss progress on supporting businesses, laying the foundations for economic growth, and maximising people's potential. Key discussions included the benefits of fiscal devolution, the development of infrastructure projects, and the provision of specialist skills support for the workforce.

Supporting Businesses

The board received an update on supporting businesses through fiscal devolution. This included discussions on the benefits of the Liverpool City Region's (LCR) Freeport and Investment Zone tax sites, which offer incentives such as 100% business rates relief for five years, relief from Class 1 National Insurance contributions, exemption from Stamp Duty Land Tax, and enhanced capital allowances. These national tax incentives, backed by central government, are designed to make the LCR sites competitive for investment.

The programme has seen significant progress, with nearly a million square feet of commercial floor space developed and a pipeline of 3 million square feet either under construction or with planning permission. The LCR Innovation Zone programme aims to achieve 5% of total economic output investment in R&D by 2030. The six tax sites – three under the Freeport programme (Parkside in St Helens, 3MG in Widnes, and Wirral Waters) and three under the Investment Zone (St Helens, Sci-Tech Darsbury in Halton, and McGull Health Park) – offer a unified proposition to investors with a single point of contact and consistent incentives.

A key aspect of fiscal devolution discussed was the retention of business rates. Over the 25-year designation period, this could result in an additional £220 million retained income for the Liverpool City Region. These funds are primarily intended for investment in infrastructure to accelerate the delivery of new commercial floor space within the tax sites or for broader projects aligned with the local growth plan. The board is seeking flexibilities from the government to align the start date and duration of business rate retention, adjust existing red line boundaries to accommodate new investment opportunities, and create new Investment Zone sites to capitalise on strategic sectoral opportunities.

Real-world examples of support were highlighted, including Finza, a European company that chose to locate and expand in Wirral, benefiting from national tax incentives. SSO Logistics, based in St Helens and Widnes, also leveraged a customs site designation for more efficient operations. Liva Labs, an innovative high-tech company, is receiving assistance in a new state-of-the-art facility.

The board also discussed the tax benefits, clarifying that business rates relief is backfilled by central government, meaning local authorities do not lose out. Instead, they benefit from new occupiers and businesses, with the retained business rates available for local investment. The LCR Freeport and Investment Zone programmes are managed by HMRC, with business rates relief being a discretionary element managed by local authorities. The retained business rates can be invested in infrastructure to accelerate the delivery of new commercial floor space, with the potential for local authorities or the Metro Mayor Authority to borrow against future projected business rate income.

Heather Akehurst OBE, Chief Executive of Open Awards, inquired about the potential for more flexibilities and future investment due to the push for devolution. Officers expressed optimism, stating that the ambition of the Industrial Strategy Zone programme aligns with fiscal devolution, and there is a clear commitment to a second phase of investment for the programme.

Laying the Foundations for Economic Growth

This section focused on key infrastructure projects within the Innovation Zone programme. A significant development is the ICON phase three, a research and development hub for infectious disease technologies, which received £10 million in investment through the Innovation Zone programme and is expected to generate £40 million in commercial income.

The Parkside Link Road, a crucial piece of infrastructure for the former Parkside Colliery site in St Helens, is progressing. This road will provide vital access to the M6 motorway, facilitating economic development and unlocking one of Europe's strategic employment sites. Phase one of the Parkside development will deliver 800,000 square feet of employment and logistics space, supporting over 3,000 jobs. The project aims to enhance freight links and facilitate a shift from road to rail, improving Liverpool's access to global markets. Councillor George Woodward, Leader of St Helens Council, clarified that the Parkside Freeport site is distinct from the Parkside Development on the west side of the site, which is proceeding via a Development Consent Order (DCO) directly to government.

Sci-Tech Darsbury, described as the UK's leading science park and innovation campus, provides access to world-class facilities and expertise. Investment in Project Violet Phase 2 at Sci-Tech Darsbury aims to address the shortage of specialised lab research and high-tech commercial space, which has previously led global firms to overlook the Liverpool City Region. This project is being funded through a dynamic investment model, cross-utilising Investment Zone and Freeport funding, and a proportion of retained business rates.

Stephen Carr, representing the Port of Liverpool, raised a question about accelerating the decarbonisation of industry by improving access to grid capacity for electricity, which is seen as a barrier to investment. Giles Jones acknowledged this challenge, noting that grid connection timescales are a significant barrier for logistics, life sciences, manufacturing, and data-intensive facilities. He highlighted the opportunity for multimodality, particularly the proposed rail freight interchange at Parkside, and stated that the challenges of grid access are being relayed to the government. The collective advocacy of Freeports to ministers on this issue was also mentioned.

Maximising People's Potential

This item focused on the Innovation Zone programme's role in providing targeted skills and outreach support to prepare students and upskill the workforce. Initiatives such as KQ Futures aim to introduce primary school children to science, technology, and healthcare environments. The Youth Guarantee Trailblazer programme helps young people not in education, employment, or training to access jobs, apprenticeships, and training.

Skills brokers have facilitated the transfer of approximately £16 million of unspent apprenticeship levy, creating 2,400 apprenticeships. The programme works closely with employers to develop employer-led skill solutions, exemplified by OWS Engineering at Wirral Waters, which is delivering its own designed apprenticeship programme.

The retention of graduates with expertise in areas like AI, digital health, and advanced therapy is considered fundamental to the future success of the Liverpool City Region. Recent data suggests Liverpool is performing well in graduate retention. The overall ambition is to ensure local people are equipped for both foundational economy roles and specialist skills created through the Innovation Zone programme.

Professor Mark Power, Vice-Chancellor of Liverpool John Moores University, emphasised the importance of providing graduates with the choice to stay in the region by creating graduate-level jobs. He also highlighted the universities' direct work with businesses to support their development and provide graduates with work experience. Giles Jones mentioned the LCR Freeport Skills Infrastructure Grant, which has supported higher and further education institutions, including the University of Liverpool's Liverpool Air Research Quality Centre, which received Freeport seed capital.

Heather Akehurst OBE commended the team for developing a cohesive skills offer that starts at primary school and demonstrates joined-up thinking across initiatives.

Future Engagement and Activity

Looking ahead, the team outlined upcoming priorities, including the conversion of Viking Park in Halton from distribution to advanced manufacturing use and significant interest from occupiers at Cross Dock. Progress at Parkside phase one is described as massively exciting, with footings going in for new units. At Wirral Waters, a European investor is expected to open a new facility, and breaking ground is planned for new facilities at MEA Park West.

The board continues to engage with the government for greater flexibilities in designating red line boundaries and introducing new incentives, aiming for more regional control as part of the devolution agenda. An application for an additional Business Rate Retention Zone in Sefton is underway, linking to the port and emerging industrial clusters. Project Violet Phase 2 at Sci-Tech Darsbury is expected to commence on-site in December or early January.

The meeting concluded with thanks to the staff and board members, and a commitment to making the notes of the meeting publicly available. The next meeting is anticipated in December.