Dimitri Batrouni said the city is at the heart of the growing South Wales compound semiconductor cluster

Efforts to revitalise Newport city centre would be significantly boosted by a relocation of the Office for National Statistics (ONS), suggests council leader Dimitri Batrouni.

And while greater investment in public transport is needed to ease traffic congestion, Mr Batrouni is also calling for the rejected M4 Relief Road project to be revisited.

The Labour politician said the city, which has the fastest-growing population in Wales, is well placed to be a key driver of the wider compound semiconductor cluster in south Wales, with the city being home to some of its biggest commercial players, such as KLA, Vishay, Intertechnology and IQE.

The ONS employs around 2,700 people at its Duffryn office campus close to junction 28 of the M4. It relocated its headquarters to Newport from London in 2007.

A relocation of the ONS would also free up land to support expansion plans for nearby tech firms such as US tech venture Vishay, which acquired the former Nexperia chipmaking fab in 2023. Nexperia had to sell the facility under the National Security and Investment Act due to its ultimate Chinese ownership.

Imperial Park, which is home to the city’s tech cluster, and the nearby ONS offices, are included in one of three sites in the UK Government-backed investment zone for Cardiff and Newport.

The other two sites earmarked for the zone are the proposed Cardiff Parkway new train station and integrated business park at St Mellons, close to Newport, and land south of Cardiff train station and Cardiff Bay.

The zone, which will receive £160m of investment and business support over the next decade, is being overseen by the Cardiff Capital Region, which covers the 10 local authority areas of south-east Wales. Mr Batrouni is also deputy chair of the city region, which now has statutory body status.

The issue of how much business rates the zone will be able to retain as well as borrowing against anticipated increases in business rates for investment – through tax increment financing -has yet to be finalised with the Welsh Government.

If the ONS were to relocate, and potentially the nearby Intellectual Property Office too, it would be driven by the Government Property Agency (GPA), which oversees the Westminster administration’s huge property estate.

The agency has a live property requirement in the Cardiff market to bring three Ministry of Justice buildings under one new 140,000sq ft location.

It has also been considering a new, smaller headquarters in the city for Companies House.

On any potential move of the ONS, although it is currently not seen as a priority matter for the GPA, leader of Newport Council Mr Batrouni said: “I would be open to any city centre option and would be happy to have discussions around that.

“However, my first priority would be, if the UK Government did announce any move, that the ONS would stay in Newport firstly.

“With a new Prime Minister in Andy Burnham, ministers have changed and we need to flush out what agenda they have.

“We are actually working on a regeneration strategy for Newport city centre. Of course, if employers of that stature were to relocate, it would help support the regeneration of Newport city centre. So, we would be up for that conversation and to help facilitate that.”

Mr Batrouni said it would be a ‘no-brainer’ for any freed-up space currently occupied by the ONS to be taken up by the compound semiconductor cluster.

It is understood that a number of tech-related investments are earmarked for Newport. The compound semiconductor cluster in South Wales, from early-stage and academic research to commercial firms, is targeting employing more than 6,000 people by 2030 and generating combined revenues of £1bn.

The ambitious target for the cluster comes after new research showed its growing importance to the Welsh economy, with it last year supporting 3,140 jobs and generating an economic gross value added of £436m.

Mr Batrouni said: “I understand Vishay would like extra expansionary land. I am a strong advocate for the semiconductor industry as it is of national importance and we will do all we can to help facilitate further growth.”

If the ONS were to consider a relocation, and depending on its space requirement with hybrid working, there is currently a lack of quality office space in the centre of Newport, although there is the Grade A 84,000sq ft Admiral House, owned by Admiral Group.

Moreover, if the ONS required additional space in a new-build, construction costs would mean it would only be viable for a developer if it entered into a long-term lease of at least £30 per sq ft.

In a statement, the ONS said: “We remain fully committed to a continued base in Newport and we take our role as a major employer in South Wales seriously.

“We have engaged with Newport City Council and Welsh Government on our estates plans, making clear the benefits of our current site and excellent amenities. Our estates strategy focuses on meeting organisational needs through all of our sites, which includes regular discussions with the Government Property Agency about their wider strategy.”

In 2017, the then Welsh Government, led by Mark Drakeford, rejected, despite a recommendation from aplanning inspector’s report, a new M4 Relief Road, which would have run south of Newport and through part of the Gwent Levels, on cost and environmental grounds.

The 14-mile stretch of new motorway then had an indicative price tag of £1.3bn.

With inflation, which has soared for construction projects, revisiting the Black Route now would have a cost well north of £2bn.

Even if the Welsh Government, and the new Plaid administration has pretty much ruled it out, were minded to look at the project again, it would need significant financing support from the UK Government and the utilisation of Welsh Government capital borrowing.

At the time, Mr Drakeford promised £1bn in public transport investment designed to reduce car journeys on the M4, where the two-lane Brynglas Tunnels in Newport can become congested, particularly at peak travel times.

Although not a devolved matter, this included the delivery of the proposed five Burns stations between Cardiff and Newport – including new stations in Newport West, Llanwern and Somerton.

However, there is nowhere near enough funding in the current spending review period of the UK Government for the proposed stations, let alone any investment in rail corridor work to support any privately financed Cardiff Parkway project.

While Sir Keir Starmer made a commitment of £14bn for rail investment in Wales just before the Senedd election, this was not a guaranteed Treasury funding commitment to Wales, but a political one from a Prime Minister who is now a backbench MP.

The test for new prime minister Andy Burnham in addressing fair rail enhancement funding for Wales will be in the next spending review, to see if more money is ring-fenced to deliver the Burns stations, which have a projected cost of £300m.

In the current spending review, there is only £450m for all rail enhancement projects in Wales.

On addressing M4 congestion, which the new Plaid Cymru administration is looking to address, Mr Batrouni said revisiting the Blue Route – running through the city – is a non-starter.

He said: “I am opposed to the original Blue Route [which Plaid were supportive of] for a very good reason.

“If you divert traffic from the Magor junction and put it through the Tata Steel Road, that goes past the new Glan Llyn estate which will have 4,000 homes when completed.

“That is part our population growth with young families and where we need to build two new schools and have already built one. They are commuters that go through that road and it is already at peak times hammered.

“When the Blue Route was originally conceived, the Glan Llyn estate hadn’t been developed.

“So, it would have to be a brand new road [based on the rejected Black Route]. Any M4 traffic would just bring the city to a standstill, which is something I could never accept. I am up for a reasonable conversation.

“When Mark Drakeford cancelled the M4 Relief Road, Mark Drakeford promised £1bn for the city, but we had nowhere near that.”

He rejected the case for closing motorway junctions in Newport as a way of reducing congestion.

The leader said: “I would obviously love a solution, but I would be hostile to junction closures.

“Would you build a motorway now with so many junctions (six in Newport)? The answer is no.

“However, those junctions have become so integral to people’s local transport patterns that closures now would mean even heavier congestion in the city, where our local roads are already under huge pressure.

“We are the fastest-growing city in Wales by a country mile [population]and we are an increasingly younger city, with our under-16s growing by 10.2%, which is double that of Cardiff.

“So, we are young, growing faster and have a booming semiconductor industry. I strongly believe that Newport is turning the page and is going to be the next economic engine of Wales, or a big part of it.”

Mr Batrouni agreed that if a new relief road is built, it would, over time, also become congested as a result of what is referred to as induced demand.

On far more integrated transport, he said: “What I would say to you is that we can have both.

“Induced demand does happen, but you can reduce that demand by having great public transport. I am all for people using trains, buses and biking and walking more. But you can have these things in theory, but people move by convenience. If public transport is close to the convenience of people’s cars they will use it, but it is nowhere near that.”

He said if a new relief road is built, he would be opposed to introducing tolls to help fund and maintain it – although it would only provide a partial contribution to overall costs.

He explained: “To be clear, I would be opposed to tolling. This is critical infrastructure which they should do anyway (government funded).

“Ultimately, a toll is a tax on the people of Wales and its economy and we need to be growing our economy.

“The only places where you are seeing strong population growth is Newport and Cardiff, so we need to encourage more young people and that means more public transport and road infrastructure to stimulate economic growth.”

The leader was also asked whether the city was being held back by not having a greater higher education sector presence.

In 2013 what was the University of Newport merged with the then University of Glamorgan, to create the University of South Wales.

Mr Batrouni said: “There is a city centre campus that does host things like the cyber security. But are you saying to me I would like more of a university presence? Then, yes, absolutely and I will be meeting the new vice-chancellor of South Wales University soon to discuss that.

“We have the semiconductor cluster literally crying out for talented and skilled people and are trying to recruit at a rate of knots.

“Why aren’t the universities, not just the University of South Wales, but others like Cardiff, saying we are going to fill that gap with our students? Bassaleg is the first comprehensive in the UK to become a compound semiconductor school, so why aren’t the universities doing this?”