Some 6,000 civil servants are to relocate to new offices in Leeds, as HM Revenue and Customs has confirmed a 25-year lease on almost 380,000 square feet of a business park in the city centre.
The announcement of new office space in Wellington Place is part of Cabinet Office’s controversial regional hubs plan, which saw agreements over the summer to rehouse 2,900 staff in Edinburgh and almost 4,000 in Cardiff.
The idea behind the scheme is for various government departments to share buildings in one of around 20 “strategic hubs” across the UK, to save money, boost regional growth, and encourage collaboration and flexible working practices – all hubs will be supported by smart technology and shared services.
In Leeds, NHS Digital has confirmed it will move in alongside HMRC, which will use Wellington Place as one of the 13 regional centres being opened to replace around 170 offices shutting down across the country.
Jon Thompson, HMRC chief executive, described the Leeds announcement as “another step in HMRC’s transformation into a modern digitally advanced tax authority”.
He added: “It’s the beginning of a process that will see around 3,800 colleagues come together in state-of-the art facilities, enabling closer working relationships and increasing our effectiveness in collecting taxes.
“It will also make HMRC an important contributor to the economy and to communities in and around Leeds.”
The HMRC regional hubs scheme has also been criticised. In January, the National Audit Office found that the changes would cost 22% more than initially anticipated, while in April the Public Accounts Committee urged the tax authority to reconsider its plans, which it said would impact negatively on local employment.
Sarah Wilkinson, chief executive of NHS Digital – which she said is one of Leeds’ major employers – added that their involvement in the regional hub would be a significant investment boost to the city.
Caroline Nokes, minister for government resilience and efficiency, added: “The Leeds hubs will be a catalyst for growth in the surrounding cities and towns, helping rebalance the UK economy and underpin our strategy for a strong, well-connected Northern Powerhouse that can continue to provide good-quality jobs and economic growth across the region.”
Like in Edinburgh and Cardiff, staff will move to their new offices in Leeds by 2020.
In a report published last month, the Centre for Cities questioned whether relocating public sector jobs outside London would automatically stimulate local economic growth for host cities.
Paul Swinney, principal economist of the think tank Centre for Cities, wrote in Civil Service World: “Relocating public sector jobs is unlikely to do much to tackle the fundamental challenges facing the cities where growth has been stalling over the past four decades.
“If the government is to move public sector bodies out of London, it should be clear about its reasons for doing so, and set up a proper evaluation of the move.”