Ian Fitzgerald & Peter O’Brien

The North East of England suffers from a number of entrenched economic, social and labour market deficiencies (ONE, 2002; Stone & Braidford, 2002). New institutions, such as the North East Regional Development Agency (One NorthEast), the North East Assembly and the Region’s four sub‑Regional Learning and Skills Councils, represent key elements of the Government’s response to tackling the ‘regional problem’. The region’s trade union movement has begun to work with these organisations, as well as other partners and agencies, to redress economic inequalities by delivering greater levels of economic prosperity and social inclusion. In an attempt to reflect upon certain aspects of this process, the Northern TUC commissioned a study in May 2002, and this article illustrates some of the key issues to emerge from that research. Before highlighting these issues, it is useful to situate trade union engagement in regional development in its broader conceptual and policy context.

Trade unions and Regional development

After a long period in the ‘political wilderness’, trade unions are once again being invited to deliver inputs into strategy development and governance as well as contributions to public policy delivery. Trade unions (along with other economic and social agents) are seen as valuable partners in the Labour Government’s ‘New Regional Policy’, which, while seen as a further attempt to narrow regional inequalities, can also be situated within the context of recent changes in territorial governance across the UK. The growing importance of the regional dimension within British politics is a reflection of the broader re‑scaling and reconfiguration of institutional forms of governance, themselves features of widespread economic and political change in industrialised societies (Tomaney & Ward, 2000). The ‘hollowing out’ of state activity – upwards to supranational bodies, downwards to local and regional interests and outwards to transnational networks – has accompanied the decline of direct state intervention and the emergence of quasi‑state and private organisations in public policy, encompassing multiple actors across multi‑level systems (Jessop, 1993). For some, such developments signal the collapse of the post‑war Keynesian Welfare State (Martin & Sunley, 1997), and the emergence of new forms of regulation and economic development, which is undermining the ability of nation states to manage macroeconomic and fiscal policy.

Within this situation of flux, the region has undergone a new resurgence (Scott, 1998). Empirical evidence from perceived ‘growth regions’ (Piore & Sable, 1984; Porter, 1990) has provided a rationale for viewing the region as the focal point for knowledge creation, learning and innovation (Storper, 1997), and the scale where economic competitiveness can be nurtured within a ‘global environment’. The region is also seen as the scale where democratic pluralism can reverse the deficits in territorial identity and accountability emerging in an increasingly global economic and political system (Habermas, 1999).

The approach adopted by the Labour Government to tackling regional economic divides has drawn emphasis from recent academic debates on the relationship between institutional dynamics and the regional scale (Amin, 1999; Lovering, 1999). Drawing on such theoretical approaches, policy‑makers in the UK have searched for alternatives to state‑led and market‑driven approaches to tackling uneven development (RSA, 2001). Successful regional economic development is now said to be contingent, in part, on the existence and operation of sub‑national institutional frameworks, which involves a pattern of associationalism or partnership between the state, economic actors and civil society stakeholders (Jones, 2001).

The origins of the partnership model of regional governance and development in the UK can also be traced back partly to the numerous examples of local regeneration and community‑based partnerships, created to improve the quality and delivery of policy (Geddes, 1998). Further impetus was given by the decision of the European Union in the 1990s to instigate a clause stipulating that the main economic and social partners (including trade unions) should be included in the programme delivery of Structural Funds. While Robinson & Shaw (2001) are right to identify that ‘partnership’ can be difficult to deliver in practice, they also acknowledge that it is infinitely more transparent and accountable than earlier ‘top‑down’ market‑based or paternalistic approaches. Sandford (2002) also suggests that the inclusion of a wider array of economic and social partners in the governance of regional development delivers more effective strategy and policy than a narrow central and local state apparatus.

The regional dimension has created greater awareness within the British trade union movement about questions of space, place and scale (O’Brien et al., 2002). Although geographers argue that social life is fundamentally spatial (Herod, 2001), studies on trade unionism have often overlooked the significance of geography (Martin, Sunley & Wills, 1996). Industrial relations research has viewed capital‑labour relations as a vertical process situated at two levels – the macro‑level (state) and micro‑level (workplace). Little attention has been afforded to the regional and local level, reflecting a tendency in traditional industrial relations to view space as an objective given (Ellem & Shields, 1999). Furthermore, until recently, economic geographers have, but for a handful of studies (Martin, Sunley & Wills, 1996; CEC, 1996; Lincoln, 2000), paid scant attention to the ‘proactive’ role of trade unions in regional development.

The (re‑)emergence of trade unions as influential partners within the varying models of regional development and governance supports conceptual awareness of labour as a proactive agent shaping economic, social and political development. Whereas neoclassical accounts view labour as a mere factor of production or an impediment to economic growth (Minford, 1985; Minford & Stoney, 1991), and alternative Marxist approaches have neglected the institutional structures and activities of trade unions, instead focusing on the reaction of labour to capital flight and deindustrialisation (Bluestone & Harrison, 1982; Massey & Meegan, 1985), this article draws emphasis from a theoretical approach suggesting that trade unions should be afforded more explicit focus as influential agents using geography to shape landscapes in different ways (Herod, 2001).

The trade union movement has long argued that regional diversity should be viewed as a ‘force for good’ and not as a source of division. Reflecting a key objective of attaining greater levels of equality within society, trade unions reject the premise that prosperity should be ‘predetermined’ on the basis of where individuals happen to live. Consequently, unions seek territorial justice and an end to the gross anomaly where particular regions continue to suffer from relative socio‑economic disadvantage.

Debates within policy and academic circles have suggested that trade union engagement in regional development can strengthen the drivers of improved regional economic performance, such as skills, innovation, R&D, investment and best practice (HM Treasury, 2001). In the area of learning and skills, trade unions are helping individuals embrace the lifelong learning agenda by providing new opportunities to access generic and vocational skills (PIU, 2001; NTUC, 2001); the evidence suggests that this helps to deliver increased productivity (Bluestone & Harrison, 2001). Examples of other strategic interventions also illustrate that unions are making meaningful contributions to a wide range of economic and social issues, and help to deliver more rounded, balanced and equitable economic growth (Pike & O’Brien, 2000; NTUC, 2002a; 2002b).

While the Labour Government’s approach to regional development has presented new strategic opportunities for trade unions, the emergent nature and pattern of regional governance across the UK has challenged unions to engage more effectively with a multi‑level economy and polity. Recent developments are distinct from periods in the 1960s and 1970s when unions occupied a place alongside business and state in national level, tripartite systems of corporatism (McIlroy et al., 1999; Ringe & Rollings, 2000). Today’s climate also differs substantially from the 1980s and 1990s, when unions were excluded from the policy‑making process (Dorey, 2002).

Existing trade union engagement in the governance of regional development further marks a break from past regional ‘corporatist’ approaches where individual trade unionists acquired representation on regional and local strategic bodies through patronage (see Shaw, 1993, for a North East perspective). The ‘new’ model of regional governance and development requires trade unions to adopt a more sophisticated and holistic approach to strategy and policy development, as trade unions are being continually asked to demonstrate their added value (O’Brien et al., 2002). This has begged the questions of the existing resources held by unions at the regional level and whether they possess the necessary individual and institutional capacity to deliver targeted and pro‑active interventions (O’Brien, 2001).

Trade unions and Regional development: A North East context

In an attempt to address these challenges, the TUC’s Northern Region[1] explored these issues through its participation in an ESRC‑sponsored PhD Research Studentship with the University of Newcastle’s Centre for Urban and Regional Development Studies (CURDS). Research has generated awareness of the key issues at national and regional level, and helped to pave the way for the Northern TUC to embark upon more recent collaborative projects, with One NorthEast, the North East Assembly and local Learning and Skills Councils (LSCs), in an effort to widen and deepen the capacity of trade unions to engage in regional development, and to construct a sustainable resource that the trade union movement in the North East can draw upon for support. This process involves strengthening the institutional and individual capacity of trade unions, primarily through an innovative training course for trade union officers and activists in conjunction with CURDS and the North East Assembly, and through the recent appointment of a dedicated policy and research post within the Northern TUC, supported by One NorthEast. These and other ongoing developments are helping to provide the trade union movement with appropriate levels of understanding to comment upon, and make effective interventions within, the regional agenda in the North East.

The next section presents data from the Northern TUC study gathered during a series of interviews conducted with key trade union officials in the North East, taking account of the views of public and private sector trade unions covering differing industrial sectors. The findings presented cover two main areas: (1) regional trade union views of the North East economy; and (2) reflections on the new regional institutional architecture which is charged with tackling uneven regional development.

Views on the regional economy

General views

Trade union officials were asked to comment on a series of areas related to the North East economy, of which regional performance, employment strategy, and issues surrounding skills are reported here. Not surprisingly, over two‑thirds of officials were of the opinion that the regional economy had performed badly over a number of years: ‘we’ve been managing decline rather than investing for the future’ (GMB interviewee 1). Although a leading GMB official cast some doubt on regional performance indicators ‑ ‘I have a real problem over how productivity is measured, it is too generalised and only seemingly based on engineering. There is no comparison of like to like’ (GMB 2) ‑ he agreed that ‘when you look at the other measures around we are less productive overall than other parts of the UK. So there is at least a problem of perception as we’re seen as a low wage, underperforming regional economy’.

Although certain sectors have experienced growth, such as business services assisted by call centres, most officials cited manufacturing as the key measure of regional performance, and this emerged as a strong theme throughout the study. Perceptions were framed on the basis of evidence found within those parts of the economy where individual unions were most concentrated. For example, as an AMICUS[2] official said, ‘in manufacturing we have the greatest density of membership and, following the national trend, like all areas where the economy is dependent on a manufacturing base, we feel it more than most’ (AMICUS 1).

However, even within growth sectors there are contradictions between business performance and member conditions. One UNIFI[3] official contrasted the example of the financial services sub‑sector with banking, which has seen a massive rise in profits engineered through a restructuring of businesses, including the closure of high street banks (necessitating employee redundancies), amd new employment opportunities in lower wage call centres. The Regional Secretary of UNISON illustrated how conditions for staff working in many private companies had declined following the contracting out of local authority services, with the care sector being the most obvious example.

Three factors were given for poor regional performance

1. Lack of investment: ‘if companies aren’t going to re‑invest, and aren’t given any assistance to, we are going to lose them altogether’ (AMICUS 2).

2. Globalisation: ‘the sad thing is a huge proportion of our manufacturing base is not indigenous and there’s been a distinct lack of investment from global players’ (T&G 2).

3. Lack of government support: ‘the government’s criteria for supporting investments through RSA funding is very restrictive and depends on new jobs being created’ (T&G 2). (The arguments surrounding state aid are touched upon later, when reflecting on officials’ views of regional government.)

Manufacturing

Manufacturing was once again at the fore when officials were asked to comment on a possible regional employment strategy. There was some caution over the exact type of manufacturing that should be encouraged; as one official commented, ‘we must be careful not to adopt the “here’s more money give us your jobs” strategy. All that will do is create a huge screwdriver approach that isn’t necessarily associated with high‑skilled jobs’ (T&G 2). This comment recognises the inadequacy of wholesale support for forms of inward investment that contributed to the branch plant economy of certain locations within the region. He added further: ‘this legacy has made more than one generation think that they can’t do anything other than have manufacturing jobs delivered for them. We’ve relied too much on major organisations like ICI and not had our own entrepreneurs’. This is an interesting view when taken in the context of current discussions surrounding raising levels of entrepreneurial activity in the region (ONE, 2002), and the affect this would have as a catalyst for sustainable growth. On the question of sustainability, there was also concern about the number of jobs that could be created ‑ one interviewee emphasised that ‘we’re not going to have another 25,000 manufacturing jobs in the next 10 years’ (GMB 3).

However, another GMB official argued that work was no longer static, and that many skilled workers indigenous to the region were flexible in their search for work – a perception that is somewhat different to that stated in the official statistics. For example, a rapid response and retraining project was established for 6,000 offshore workers who had lost their jobs. However, only 60 registered, as most of the others had skills which were ‘mobile’, i.e. the skills were readily transferable to other yards throughout Europe, where many workers found jobs without the taskforce’s assistance (from GMB 1). This official also noted that statistics from his union indicated that it currently had a ‘low’ turnover rate in membership (8%), and, of this number, only one‑third became unemployed. Another senior official agreed, arguing that the decline in manufacturing was at a sub‑sector level: ‘it’s parts of manufacturing ‑ for example, engineering ‑ rather than the sector as a whole’ (GMB 2).

Overall, there was strong support for the role of manufacturing within any regional employment strategy: ‘for the GMB, manufacturing is the key economic generator and there are indications that there will be growth. It will continue to be one of the key sectors for this region for some time to come and we need to address our resources accordingly’ (GMB 1). USDAW and AMICUS officials concurred with this, with one putting a national slant on the argument: ‘there is no doubt that as a country we must manufacture to pay our way in the world, so we must continue to make a strong case for manufacturing’ (AMICUS 1). A senior official of the public sector’s largest trade union – UNISON – made the point that ‘we need manufacturing jobs, we need to have something for young people to aspire to. The problem is, when manufacturing is gone, you don’t get it back again’ (UNISON 1). She further questioned the sustainability of the ‘new employment’ the North East had attracted, stating that ‘we can’t have a region relying entirely on call centres!’ (UNISON 1), a sentiment echoed by a number of other officials.

Other sectors

The role played by other sectors in developing a sustainable employment strategy was also explored. The UNISON interviewee, while arguing that ‘if we’re going to have a vibrant region, if we’re going to succeed, we need a mixed economy’, believed that expansion of the health sector was necessary and imminent ‘because of the legacy of ill health that heavy industry has left us’. Similarly, a PCS[4] official noted that, ‘we’ve been relatively successful in getting public sector work into the region and this has accelerated over the last few years’ (PCS 1).

Skills

A critical aspect of any employment strategy is the development of skills. If organisations are to develop, they need staff trained to a range of skill levels. Union officials clearly see the skills agenda as a central component not only of regional regeneration but also of future trade union organisation and growth, with both providing an excellent opportunity for the trade unions to influence regional development. Most officials agreed that the type of training predominantly on offer was ‘more short‑term as opposed to the four or five year apprenticeships’ (GMB 3) – a situation which meant that ‘our skills base does not match the demand in our existing industries. We’re losing out in attracting new industries because the skills base in the region is extremely poor’ (GMB 1).

The view of approximately one‑third of officials was captured by a GMB official who argued that ‘employers simply do not have the resources in the region to invest in skills. The Government needs to be very aggressive in the way it deals with the skill problem’ (GMB 1). An AMICUS official drew attention to the problem of re‑skilling for the newer types of industry settling in the region: ‘a significant number of our members will face great problems transferring their skills into new areas as the employment demographics of the region change’ (AMICUS 1). The issue of skills was seen as very much a part of an overall learning agenda in which individuals move away from limited job‑specific skills to acquiring transferable skills linked to lifelong learning. But, as a senior GMB official noted, ‘there are problems with a strong perception in the regional economy that some people don’t need training at all because their jobs are so low level. So there is no vision about what they could be doing, how we could nurture them’ (GMB 2). A change in direction is dependent on company decision‑making structures and differing sector‑specific problems: ‘we are trying to get employers to embrace the learning agenda but they have problems as employer decision making is nationally based’ (UNIFI 1 on the banking sector). In other sectors, however, change is occurring. As the AMICUS interviewee reported, ‘for our members the issue of development and training as individuals is starting to come first, before wages’.

Officials noted two main areas of learning and skill development, higher‑level skills (NVQ 3 and above) and key (or basic) skills. According to a T&G official, those in the Tees Valley ‘who had transferable skills ‑ e.g. NVQ level 3 qualifications ‑ have been able to secure jobs. Those who didn’t have them didn’t get jobs’. The point here is that skills must relate to the ability to learn more flexibly, as the UNISON interviewee noted: ‘for all of our members it’s having the right qualifications at the right time, and some members need to develop higher levels of skill’. Other officials noted the need for such types of skill, with a GMB interviewee arguing that ‘high value added skills levels are a key target for us’, while his colleague responsible for the shipyards believed that ‘we need to keep the high levels of skill in place’ (GMB 3). But it was in the area of lower level key skills that officials were most vociferous: ‘key skills are vital, without them we can’t start. There are people in employment without these, so we can’t give them further training and of course this is passed on in families. So if we can help parents, then the children will come into the workforce better prepared’ (GMB 2). The UNISON interviewee argued that ‘key skills are hugely important, and this is a really big issue for the region’. She went on to argue that this would allow ‘career progression’ for many members of her union that did not have basic skills. A T&G education officer also noted that basic literacy and numercy skills were essential for those in communities that have been socially excluded. The question lay in how officials believed these issues should be tackled.

Interestingly, several officials noted that a partnership approach with employers had facilitated the development of ‘a lot of good will with resultant skill development and it’s one area where partnership has worked emphatically’ (UNISON 1). The GMB official responsible for the shipyards noted that a ‘partnership approach has been very useful when pushing for funding from the LSC and training bodies’. However, officials felt more potential existed in the area of Union Learning Representatives (ULRs). One official argued that ‘learning representatives are a key initiative that is quickly impacting on workplace learning and personal development, in the same manner as the Health and Safety Reps improved workplace health and safety in the seventies and eighties’ (AMICUS 1). An USDAW official similarly stated that ‘we’re committed to learning reps. USDAW are going to mainstream lifelong learning and have a dedicated lifelong learning worker. At the moment we have a number of pilot projects concentrated in the mail order sector, with around 12 representatives in the North East across four or five companies’ (USDAW 1).

While there were some quite clear and vociferous views on the state of the North East economy, and the possible steps required to turn around the fortunes of the region, the Government itself has adopted an institutional approach to tackling regional divides, and has established new institutions within the English regions. The next part of this paper seeks to ascertain perceptions from within the trade union movement on the performance to date of the emerging regional institutional architecture.

The new Regional institutional architecture

Officials were initially asked about their union’s current influence on the main economic development forums. In answering this, a number of interviewees felt it pertinent to discuss what can be termed ‘the struggle with ideology’. This ‘struggle’ concerns the years when successive governments and waves of economic decline pushed trade unions to the margins, not only in terms of government communication but, more importantly, among workers and employers. As an AMICUS official argued: ‘remember, for so long we were cut out of this by Thatcher’ (AMICUS 2). A GMB official also noted that from being completely excluded by all the agencies, ‘the trade unions and TUC have had a huge job of work to convince the individuals on these that we can do something of value’ (GMB 1). Trade unions are only now beginning to be recognised again at the regional decision‑making level as an influential voice, and as partners both in the workplace and in the governance of regional development. The GMB official went on to argue that ‘this works at varying levels. The LSCs understand that trade unions can do something as part of their objectives, but the RDA are learning slower and Government Office have been the hardest to win over’ (GMB 1). In this context, a senior GMB official spent a period on the ONE NorthEast board and ‘surprised people because they did not expect a trade unionist to make a useful contribution’ (GMB 2).

Most trade union engagement in the region has emerged at the local LSC level, with the T&G and UNISON securing the majority of representation on LLSC Boards in the North East. LSC Board members from unions also attend the regional TUC’s Education, Learning and Skills Forum, reporting on developments in their sub‑regional areas, and feeding into the broader regional trade union movement. As one of the T&G officials reported, ‘the LSCs are the holders of the purse, so the trade unions have to have some involvement here. The LSC is an important strategic area for trade union involvement’ (T&G 1). The UNISON interviewee stated that they had been very successful in getting members onto the LSCs after applying for positions advertised in the press. A GMB official, though, believed that, with regard to the LSCs ‘the role that we can play in there is undervalued and understated’ (GMB 3). Problems of resourcing were touched on by the USDAW interviewee: ‘we are finding it difficult to find the resources. We will commit resources to the LSCs and help them develop but we’ve only just begun to mainstream lifelong learning’.

The re‑establishment of a working dialogue with employers is also fundamental, as unions begin to return to the type of networking that underpins regional governmental structures. A T&G official discussed his practical experience of this, reporting that ‘I went to a recent CBI dinner and the key employment partner at Dickinson Dees was taking T&G packs away to give to employers. This was on the basis of trying to get employers to sit down and talk through the issues rather than having a recourse to the courts all the time’ (T&G 2). One GMB official also noted that in the shipbuilding and engineering industries employers had recognised that trade unions were much better at ‘finding their way through the bureaucracy’ (GMB 1). He went on to state that ‘the skills agenda had provided an opportunity for unions to develop workforce strategies with individual employers. Our members and non‑members are seeing the positive role that trade unions are playing and membership has increased because of this’.