21 October 2010

Local Enterprise Partnerships begin to take Shape

At their meeting at Bradford on 29 June 2010. the Cabinet resolved to abolish the Regional Development Agencies ("RDAs") and replace them with Local Enterprise Partnerships ("LEPs").

The Ministers' Letter
That same day Dr. Vince Cable, the President of the Board of Trade etc, and Mr. Eric Pickles, the Secretary of State for Communities, sent a letter to local government and business leaders inviting them to arrange for local groups of councils and business leaders to come together to develop proposals for such LEPs.

LEPs' Powers
It is clear from the ministers' letter that these new LEPs can be nothing like as powerful as the RDAs they are intended to replace. For a start, attracting inward investment, sector leadership, business support and innovation and access to funds are to be handled nationally while regional strategy is to be abandoned altogether. The new partnerships will be left with such weighty matters as planning, housing, local infrastructure and business startups. The letter envisaged equal representation for local government and business on the governing bodies and that those organs would usually be chaired by a prominent local businessman.

Deadlines Missed and Kept
Dr. Cable and Mr. Pickles promised a white paper on "sub-national" (the adjective "sub-national" apparently being Newspeak for "regional") growth by the summer. As it is now October that has clearly not happened Even though the government has missed its own deadline it insisted on submissions from local authority and business syndicates by 6 September. This was a very tight deadline slightly over 2 months from the original letter that appears to have taken no account of annual holidays.

Proposals Received So Far
Remarkably, nearly 60 proposals were received by that deadline. Some of these have been published on the grandiloquently named Department for Business, Innovation and Skills's ("BIS") website. If the ministers had seriously hoped that groups of local authorities and businesses would get together, they must be disappointed. For the Greater Newcastle conurbation there have been no less than 4 separate proposals from Northumberland and North Tyneside, Newcastle and Gateshead, South Tyneside and Sunderland and County Durham. Several proposals cover the same area: the Greater Manchester metropolitan authorities and the Peel Group have both submitted proposals for Manchester and there are separate proposals for the Gatwick Diamond and the "Brighton and Hove, Croydon, the Gatwick Diamond and West Sussex - Coast to Capital" project. Instead of local collaboration the proposals appear to show a revival of local rivalries.

Some clues as to funding that may be available after the dismantling of the RDAs come from two consultation papers which BIS did get round to publishing over the summer:
  • a green paper on a £1 billion regional growth fund announced by the Cabinet in Bradford "to encourage private sector enterprise, including social enterprise, and capacity, and in doing so create opportunities for people and places to adjust to reductions in public spending"; and
  • "Financing a Private Sector Recovery" (Cm 7923) a consultation on access to funding in the private sector.
It is clear from those consultation documents that only money that could be available to the LEPs will be the regional growth fund. My initial view is that £1 billion spread over 8 of the 9 regions of England is not very much. Such a sum is unlikely to create much opportunity in places where there are likely to be massive public expenditure cuts.

Local Business Advice
One of the first casualties of the abolition of the RDAs are likely to be local and regionalBusiness Link services. In an interview with Jason Hesse on the Real Business website, Mark Prisk, the Business Minister, announced:
“We’re going to wind down the Regional Development Agencies, and as part of those, we’ll be winding down the regional Business Link contracts.”
These will be replaced by a state funded online service - presumably the existing Business Link website possibly under the "Solutions for Business" brand - and greater use of existing service providers such as chambers of commerce and local authorities. The proposal for a new business information service to be provided by thee British Library, NESTA, Newcastle City Council and Northumbria University is probably something like the model Mr. Prisk had in mind (see "Mark Prisk announces new business advisory service" on the Real Business website).

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