'Western powerhouse' aim for Cardiff, Bristol and Newport

By Sarah Dickins
BBC Wales economics correspondent

Image source, markc212/Getty Images

A "western powerhouse" between Cardiff, Newport and Bristol can boost job prospects across the whole region, the Welsh secretary has said.

As a first step, Alun Cairns has set up a Severn Growth Summit in Newport, with 350 delegates.

He believes it has the potential to rival the Northern Powerhouse or "Midlands Engine".

"It's about time that we made politics fit business rather than business fit politics," added Mr Cairns.

He believes the Severn crossings have acted as a barrier to businesses and communities in Wales and England for the past 50 years.

This is not just because of the tolls for vehicles travelling west along the M4 but also because the bridges have become a symbol of an economic barrier.

Media caption,
Alun Cairns said business in south east Wales could "tap in" to the economic prosperity enjoyed by Bristol

Mr Cairns believes this has held back Wales' prosperity and without the tolls - which are due to be phased out by the end of 2018 - people and business would have become more integrated.

But also since devolution, Wales has differed in the way that it has tried to grow its economy - from training and job creation to apprenticeships, the policy path has been different to England.

Asked if this approach undermined devolved economic policy, Mr Cairns said: "For the 20 years we have been talking about devolution we've been talking about collaboration but that collaboration doesn't stop at the Welsh border.

"This is about doing the right thing for businesses and for the economy in order for both sides to grow and I think Wales has a lot to gain," he said.

"I think the whole mass of the great western cities of Swansea, Cardiff, Newport, Bristol and Bath, combining the might of them and all of a sudden if you are an international investor you can see what all these cities have to offer, how they dovetail and how they come together."

Image caption,
Map of commuting patterns between Newport, Cardiff and Bristol

That argument may go down well in Newport where house prices are predicted to rise once the Severn tolls are abolished.

It may also make sense to businesses which feel the tolls have been a barrier to their work.

But it may be controversial in some political circles, where critics could argue the Welsh economy will be the loser and such partnerships could undermine devolution.

Mr Cairns said one of key drivers of the Northern Powerhouse was the commuting between Liverpool and Manchester.

But more people - an estimated 2,466 - commute between Cardiff or Newport and Bristol already, before the abolition of the bridge tolls.

With house prices rocketing in Bristol it is likely south east Wales will see an increase in the number of people buying homes while working on the other side of the estuary.

Similarly, we can expect more people living in Wales accessing jobs in England. That could be seen as Wales losing skilled workers or as a benefit if Bristol-level wages are spent in Wales.

James Durie, chief executive of Business West at the Chambers of Commerce and Initiative said the Bristol region and south Wales had more in common than ever before and it was an opportunity to make the most of shared interests.

"In the past the Bristol city region has largely tended to look east to London and the south east instead of also forging closer links with its close neighbours less than an hour's drive away," he said.

A Great Western Cities report commissioned by councils either side of the Severn two years ago looked at the "powerhouse" potential of "greater sharing".