A Green Jobs Dividend for the UK

The Global Centre of Rail Excellence being constructed in south Wales shows how rail can help build a fairer and more balanced economy in the UK on the path to net zero

Last year the Resolution Foundation think-tank published the interim report of their Economy 2030 enquiry. It said that while the UK has many great strengths, structural weaknesses of slow growth, sluggish productivity and income inequality continue to hold back its economy. It said that gaps between people and places across the UK were too high and that shared prosperity had to once again become the UK’s driving economic focus.

All governments across the UK recognise the need to support a more balanced economy to begin to address the difficulties faced by communities and families across the country. Indeed, many of the questions facing our economy will require a national effort from all of us. In that context, what of the role of rail? What does the sector owe to that collective challenge of building a fairer, more inclusive and stronger economy right across the UK?

At the Global Centre of Rail Excellence – a new, purpose-built facility opening in 2025 that will become Europe’s leading rail innovation centre to support world class research, development and certification of rolling stock, infrastructure and innovative new rail technologies – the answer is a very clear one. Rail can – and must – play an active role in supporting a fairer, greener and more productive economy, and that the GCRE facility itself provides some lessons as to how that can be done.

GCRE is born

When Ministers in the Welsh Government began to consider the opportunities to develop a rail innovation facility in Wales, the idea had a very clear economic development focus – its purpose was to help bring new green jobs and high quality skills to the former mining heartland in the Swansea and Dulais Valleys. In 2021 the Welsh Government provided £50 million of funding to kick start development of the idea and take it forward.

The UK Government quickly saw the strengths of the GCRE vision, too, backing it with £20 million from the Department for Business, Energy and Industry Strategy and a further £7.4 million provided through Innovate UK. In itself GCRE has been a good example of two UK governments, of different political stripes, working collaboratively to support a facility with direct economic impact in an area impacted by more than 40 years of deindustrialisation, but which at the same time provides a critical piece of innovation infrastructure the sector badly needs. As the UK makes the transition to a net zero economy GCRE is a tangible green jobs dividend.

Where rail can play an active role

One of the significant ways GCRE can support inclusive growth is being a ‘magnet’ that can act as a hub for research and development (R&D) investment. For many years one of the central challenges facing policymakers has been how to attract R&D funding into high quality idea outside of the golden triangle of London, Oxford and Cambridge.

In its Levelling Up White Paper, one of the twelve stated ‘missions’ of the UK Government is to ensure that by 2030, domestic public investment in R&D outside the greater south east of the UK will increase by at least 40 per cent. The hope is that funding will leverage at least twice as much private sector investment to stimulate innovation and productivity growth.

With GCRE, south Wales will have a rail innovation centre of world class quality, quite unlike anywhere in Europe, giving UKRI and the wider private sector a place to focus investment, capacity and knowledge that can have significant returns for industry, for the environment and for the region in which its based.

At root, GCRE will be a place where people and ideas come together – a facility where some of the world’s leading engineers and technicians will come together to research, develop and refine ideas that can become the backbone of the transport systems of tomorrow. And that’s another area where the facility can help support growth.

Great ideas mean commercial possibilities and GCRE is planning to have enabling facilities on site that can capitalise on that potential. Learning from models like Silverstone, the vision includes space on site for new companies; incubator labs for tech-startups; business advice for those looking to grow their firms and room for partnerships with local universities and further education colleges to flourish. It’s hoped the facility can translate the ideas developed on site into grounded economic and commercial impact for the communities and region in which it sits.

Plan for Rail

As the rail industry embarks on significant reform, it has a chance to fuel more creativity of this kind. The Plan for Rail, published in 2021, sets out to create ‘Great British Railways’ to enhance strategic planning and which could play an important leadership role in this space through its ambition to support ‘new, locally-led innovation schemes that can unlock smarter working and support growth’.

It's accepted that more strategic and faster rail innovation, as part of a coordinated, long-term approach to rail infrastructure and network planning, would have significant benefits for the UK. GCRE coming along at the same time provides an effective, single strategic site to support those very reforms.

Most notably GCRE would support the rail industry, government and its partners to better realise a variety of critical policy ambitions over the next few years, including lowering transport emissions on the path to Net Zero and in helping make the railway more cost efficient. But, crucially, it would also prove to be an effective case study for the industry to demonstrate tangible action towards supporting the national effort for fairer, more balanced growth.

Export Opportunity

The sector supporting GCRE to be a success would have another, important economic impact – it would give the UK a critical export advantage. By having on its doorstep an international standard rail research, testing and certification facility, supporting a faster innovation process, the UK would help attract companies to test and seek approval for products, because for key areas like infrastructure, there is no dedicated site anywhere Europe in which to test new products. Having a facility like GCRE in the UK – leading standards in rail innovation –brings not only inward investment potential, but the chance to export goods and services developed on site, not to mention giving the rail industry a more resilient supply chain model for the future.

The UK Government’s Rail Sector Deal in 2017 articulated that very ambition, seeking to ‘equip the railway for its strategic role as a driver of economic growth’, in part through encouraging increased investment in UKbased rail R&D and doubling rail exports. Digital and data elements of the Rail Sector Deal appeared strongly, as digitalising networks at scale would allow UK companies to become global leaders through ‘firstmover-advantage’, supporting more exports of goods and services. The potential of the GCRE site to support these ambitions is a significant one.

Conclusion

The Dulais and Swansea valleys in which the Global Centre of Rail Excellence facility is located is a region rich in its industrial history. With the new facility opening in 2025, the area can look ahead to a new industrial future as well. For the region that’s crucial, but the wider lessons for rail sector are important too. By helping make GCRE a success rail can show its determination to play an active and substantive role in building a fairer and more balanced economy on the path to net zero. It’s time to make GCRE a success and see what other opportunities the rail sector can develop to help tackle the challenges the UK economy and its communities face both now and in the future.