By Daniel Hunter

Regional cities in England, Scotland, Wales and Northern Ireland are outshining the UK's largest cities when ranked by both economic success and the factors which the public hold dear to them, according to the 2013 Good Growth for Cities index, produced by PwC and think tank Demos.

For the second year in a row, some of the UK’s medium-sized regional cities, including Reading, Aberdeen, Preston, Southampton and Belfast, rank higher than they would be in tables based on economic size alone - usually dominated by London, Birmingham, Leeds and Manchester — contrasting public and expert views on what makes a city attractive.

The largest cities favour less well for ‘good growth’ due to challenges with transport congestion, housing affordability, income inequality, and other quality of life indicators.

The PwC report measures the current performance of 39 cities on a wider range of measures than GDP alone, capturing the characteristics of a city which the UK public considers important for judging medium to long term success. The basket of measures, identified by the public and business as key to economic success and wellbeing, include jobs, health, income and skills.

Above average cities for ‘good growth’ perform well on the job, income and skills measures in the report. By contrast, with the exception of London, cities which rank lower in the index score comparatively well on housing affordability and work life balance but less well for jobs, income and skills.

John Hawksworth, chief UK economist at PwC, said: “Our analysis demonstrates that there is a rising price for economic success for many of the largest UK cities. Increased congestion, pollution, income inequality and high house prices contribute to rankings in the index below that expected based on traditional GVA measures. Medium sized cities with better quality of life tend to score better on our index based on what the public says is important to them.”

London’s performance stands out, with the popularity of the city as a leading international business centre causing its own challenges. Despite the highest income levels in the country, when measured against the wider range of publicly defined ‘good growth’ criteria such as affordable housing, transport, and working hours, it slips below the UK overall average for ‘good growth’. The contrasts within the Capital’s boroughs are also stark, with the report noting that some high ranking London boroughs including Wandsworth and Harrow/Redbridge would be well above the average for all UK cities in the index.

Paul Cleal, head of government and public sector at PwC, said: “Good growth is in everyone’s interest. And to support good growth we need good jobs, ones that give satisfaction, pride in doing good work, meaning (such as contribution to the community), an opportunity for career progression, flexibility (work-life balance) and income sufficient to live on, ideally with a little left over!

“Public sector organisations at all levels, particularly in our cities, have an important role to play in creating a platform for growth through a focus on the key levers of skills, infrastructure and innovation.”

This year’s index includes skills as a measure of good growth performance for the first time, recognising it as the foundation for both getting people into work and earning a living, and wider business expansion. Cities such as Edinburgh, Belfast, Oxford and Cambridge all score well on this indicator.

Against good growth measures, big cities have major challenges to address including congestion, pollution, transport and housing, especially with public funds in short supply. Councils and Local Enterprise Partnerships need to address these issues as they develop their growth plans.

Nick Jones, director, PwC’s public sector research centre, said: “Every city needs a growth plan that’s linked to its distinctive local assets, and that’s not just the standard menu of priorities of green jobs and digital hubs. Regions need investor ready opportunities to present to the market, built on a clear vision of their assets and selling points.

“Competitiveness is coming down to not just how cities attract financial investment, people and skills, but speeding up their response to changing business, resident or investor requirements. They simply cannot afford to take 20 years to deliver major infrastructure developments — planning and response to changing needs has to be much faster.”

Other key findings:

- Reading & Bracknell, Aberdeen, Edinburgh, Southampton and Cambridge rank highest on the index.
- The lowest ranking cities were spread across the UK, including Middlesbrough & Stockton, Swansea Bay and London
- The majority of cities in the devolved administrations, including Edinburgh, Aberdeen, and Cardiff, perform above average in terms of work-life balance and transport, but performance tends to be less strong in relation to health in particular.

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