Back to the future

Published on 30/11/2003 00:00

IT’S 2020 and Greater Edinburgh, the new culture and business capital of northern Europe, is basking in the glow of prolonged economic success.

Along Princes Street, architectural gems fit for a world heritage site provide space for the leading names of global retailing. Trains disgorge commuters from the Borders and other far-flung outposts of the city-region at the newly revamped Waverley transport hub. Trams and state-of-the-art buses glide along decongested streets - both the concrete result of the road charging scheme introduced more than a decade earlier.

Even the people have changed. There are more Slavic, African and Indian faces after a huge response to the First Minister’s call for immigrants to be made welcome in the face of dire labour shortages. New businesses are springing up everywhere as a clear symbol of renewed entrepreneurial zeal. A new census puts the greater Edinburgh population at over one million for the first time.

Up in the City Chambers, councillors from both Edinburgh and Glasgow are round a table discussing the joint plans to host the European football championships. Next week, a delegation will arrive from Newcastle to discuss a north-of-Britain bid for the Olympic Games.

Down on the Leith waterfront, foundations are being laid for the new global headquarters of the World Environment Organisation, the new UN body that will bring at least 2,000 highly-paid civil service jobs to the city. A large American bank has just announced plans to move 400 of its key staff from Paris to the city’s booming financial services quarter. New home builders are scenting the heady atmosphere and preparing to scrap hard for the few remaining gap sites to construct high quality city homes for the incoming pay packets.

But consider an alternative vision.

Discount stores move onto one of Europe’s most famous streets as big-name retailers relocate out of the congested city centre. The road tolls plan has come to nothing and major public transport projects have simply failed to materialise.

The population is ageing as young people once more seek escape from a demoralised Scottish capital.

City leaders squabble with Glasgow for desperately needed public cash and the World Environment Organisation decided to turn down Edinburgh for the vibrant new twin-city hub building up around Milan and Turin. The American bank moves its operation to northern Italy after failing to attract the top calibre of staff to Edinburgh.

These two visions of Edinburgh could not be more different, but the city’s leaders will be warned next month that decades of prosperity are within their grasp - as long as they do not fumble the opportunities that lie ahead. This is why Edinburgh City Council has spent 75,000 in an attempt to predict the future, inviting experts to gaze into their crystal balls and tell them how to create utopia and avoid a dystopia.

The result will have consequences far beyond the city itself. The rebirth of Edinburgh as a major financial, commercial and retail centre has been the driving force of the Scottish economy for the last five years, reflected in soaring house prices that have spread far and wide and virtually full employment. That the city has arrived on the global radar was proved last month by the presence of the MTV music awards.

"There is no doubt that Edinburgh has done very well as a city but certain things need to happen if it is going to progress on to the next stage," said Andrew Holmes, the council’s director of economic development. "What we wanted to know is what do we need to do to make sure that Edinburgh and the region around it truly becomes an economic powerhouse that can compete on a global scale. We believe the benefits will filter throughout the central belt and beyond. We wanted to know what a greater Edinburgh would look like and, equally importantly, what it could also look like if we got it wrong."

Holmes has the luxury of working from a position of strength. Edinburgh has been on a roll for most of the past decade and its average level of personal disposable income is nearly 30% above the national norm.

Quality of life surveys regularly find it the most desirable city in Britain. The population is at its highest level since 1980 and is continuing to grow. House prices rose in value by an average of 25% last year, sending the feel-good factor among residents spiralling upwards.

Thousands more jobs have been created amid an unprecedented 2bn building boom of which the new parliament taking shape at Holyrood is just a small part. Around 400m is going into creating a new financial district, 500m into a business park close to the bypass. Up to 100m is earmarked for new development along Edinburgh’s newly discovered waterfront. The Royal Bank of Scotland’s new global headquarters, another 100m of investment, is taking shape close to the airport. It is the country’s leading centre for fast-growing computer software companies and Europe’s sixth-largest fund management centre.

Sales of luxury goods and services are soaring with some of the biggest and classiest names in retailing clamouring to get in to city centre retail developments. Louis Vuitton and now Giorgio Armani have joined Harvey Nichols on The Walk, the new upmarket arcade billed as the Bond Street of the north.

New restaurants are opening at the rate of two a month. Last week brought the debut of Prestonfield House, a new fine-dining destination in a 17th-century mansion just five minutes from the city centre. Owner James Thomson

feels able to charge a minimum 195 per night for the hotel’s 28 rooms and expects to fill them on a regular basis. "Edinburgh is certainly going through a boom time and is now a major player on the world stage," Thomson said.

In some ways, Edinburgh has become a victim of its own success - though, again, this can offer benefits to other parts of Scotland. So rooted is the belief that Edinburgh is doing so well on the economic front that the Scottish Executive has ordered a dispersal of well-paid civil service jobs out to other parts of Scotland. The loss of more than 200 Scottish Natural Heritage jobs to Inverness, possibly the first of many such dispersals, is expected to be met by the Edinburgh economy without blinking, even if many of the workers themselves are opposed to the move.

Holmes is among those who believe that if the Edinburgh region wants to take the next step and become a truly global power then it has to take certain courses of action, and it was this kind of thinking that inspired the Future of Edinburgh scenario-writing exercise. Around 150 business, retail and tourism leaders in the area - of the calibre of Sir Tom Farmer and Fred Goodwin, the highly-regarded chief executive of the Royal Bank of Scotland - were consulted on how the city could move ahead.

Their views have been distilled into the scenario documents that will be released for public debate on December 9 in advance of a major conference to discuss the issues confronting the city and its neighbours next spring.

John McTernan, former head of strategy at the Scottish Executive and the lead scenario-writer, said: "In one scenario the city makes a serious attempt to become the capital of northern Europe. It could be done. In the second scenario it goes into a gentle decline. It is a matter of which route the city and its partners now choose to go down."

A key factor will be a modern public transport system, involving rail, trams and buses, that is the envy of European capitals and extends the city hinterland across traditional local authority boundaries. An essential part of financing such a system, according to McTernan, who next month joins Tony Blair’s strategy team, will be some form of congestion charging, as controversially proposed by Edinburgh City Council for 2006.

"If we want to have this superb public transport system then we have to realise that it won’t all be paid for out of council tax and that we also won’t get all the money from central government, which has a host of other priorities. So some form of congestion charging will be necessary. After all, roads are a utility like water and electricity and those who use them most should pay more to do so."

An efficient public transport system will increase the city’s attractiveness to incoming business, both private and public sector, as workers will find it easier to commute. Without congestion charging, traffic gridlock will eventually bite and companies will begin to relocate, taking jobs and prosperity elsewhere.

Another key factor is building relationships not only with the private sector but also with surrounding councils, as Edinburgh is unlikely to be able to build its 2020 vision alone. That means partnerships not only across the Lothians and Fife, which have already benefited from the Edinburgh boom, but also Glasgow.

Scotland on Sunday columnist McTernan says the world has numerous examples of neighbouring cities that have buried old enmities to work together and have gone on to reap the economic benefits.

"In the 1970s, Dallas and Fort Worth in Texas were two medium-sized cities that were going their own way. Now the Dallas-Forth Worth Metroplex is a booming metropolitan area of five million people. Turin and Milan are teaming up in the same way as are Malmo in Sweden and Copenhagen in Denmark. They are becoming some of the most dynamic city-regions in the world."

The key, according to McTernan, is developing a common plan together. "Edinburgh should be left to become the financial services centre while Glasgow develops the creative arts, for example," he said. "That way you get co-operation rather than destructive competition."

They should work together to ensure that both are served by fast transport links.

"Glasgow benefits because even if a commuter has a job in Edinburgh he can easily get back home at night. Companies based in Edinburgh will have no problem in creating extra jobs in Glasgow."

McTernan believes that Edinburgh could be on the verge of replicating the success of London, which bounced back from recession and the loss of a third of its manufacturing jobs in the 1970s to ride back to recovery.

"Of all the capitals in the smaller countries, Edinburgh already has the greatest international status. If it takes the right choices it could be the most important city in northern Europe," he said.

EDINBURGH IN 2020?

THE scenario for a successful ‘Greater Edinburgh’ includes the following:

POPULATION GROWTH

In 2001 the census showed 449,000 people in Edinburgh, projected to top 460,000 in 2011. By 2020 the city’s numbers must rise to 650,000 to create a successful European capital. The population of ‘Greater Edinburgh’ (ie plus East, West and Mid Lothian) would be more than one million.

TRANSPORT

Between 1bn and 1.5bn is needed to produce a tram network extended to Penicuik and Dalkeith, a railway extended to Galashiels, a rail link to Edinburgh Airport, and another Forth Bridge crossing.

JOURNEY TIMES

The train journey between Edinburgh and Glasgow must be cut to 30 minutes. To ease congestion, the number of cross-town journeys must be cut by 25%. All parts of the Central Belt must be only 45 minutes away by road or public transport.

AIRPORT

In 2000, Edinburgh Airport had 5.5 million passengers. By 2020, a successful Edinburgh will welcome 15 million passengers, boosted by tourism, business and extra flights.

ENVIRONMENT

A 25% reduction in greenhouse gases is the optimistic prediction for 2020.