Asked by
To ask His Majesty’s Government what assessment they have made of
the ending of local enterprise partnerships’ funding and the
impact on local economic development.
The Parliamentary Under-Secretary of State, Department for
Levelling Up, Housing & Communities () (Con)
The Government are committed to empowering locally elected
leaders to drive local economic development. From April 2024,
government will support local and combined authorities to deliver
the core functions currently delivered by LEPs; namely, the
functions of strategic economic planning, business representation
and ongoing delivery of specific government programmes. Revenue
funding will be provided to local and combined authorities in
2024-25 to support this activity.
(Lab)
My Lords, Labour’s very successful regional development agencies
were replaced with local enterprise partnerships in 2011. These
will be abolished next year. From micro-businesses to
multinationals, businesses cry out for certainty, consistency and
competency, but, far from levelling up, all they get from this
Government is chaos, confusion and closure. The best way to
restore business confidence would be for this Government to shut
up shop and call an election. Are these businesses wrong in their
assessment?
(Con)
Yes. I also disagree with the noble Lord’s assessment of RDAs. I
would be interested to know, if they were such a successful way
of delivering local growth, whether they would be re-established
under future Labour plans. The Government are focused on
empowering local leaders over geographies that make sense in
local areas to deliver local economic growth. We are working to
integrate the roles of local enterprise partnerships into local
areas so that we have the best of both worlds, with local
democratic accountability and strong business voices to drive
economic growth.
(LD)
My Lords, I well understand the arguments that the Minister made
regarding the shifting of LEP funding. To return to the Question,
which the questioner rather strayed away from and which is
whether the Government are satisfied about the impact on local
economic development, is the Minister satisfied that the existing
schemes, which are often successful, will not be damaged? I am
thinking particularly of the very successful work done by a
number of combined LEPs on digital poverty and exclusion.
(Con)
I assure the noble Lord that the Government are confident that,
in integrating the work done by LEPs into local authority or
combined authority areas, we will not lose the benefits of the
great work done by LEPs since their establishment. The aim is to
integrate that with local democratic accountability. It is part
of our broader agenda on devolution and we will continue to see
some of that great work delivered over similar areas to now.
(Con)
My Lords, is it not the case that, since the LEPs were set up in
2011, more and more of their functions have been transferred to
mayoral authorities and combined mayoral authorities, and have
been included in devolution deals, many more of which are still
on the way? Is that not a more democratic solution than the
unelected LEPs?
(Con)
My noble friend is absolutely right. In taking this decision, we
conducted an information-gathering exercise with local
authorities and LEPs to understand the impact of our plans. That
identified great overlap between some of the functions discharged
by LEPs, local authorities and combined authorities, as well as
confirming a high level of integration of LEP functions in
mayoral combined authorities. That is why we are taking the
direction of travel that we are. The Government’s view is that
there is likely to be scope for both greater join-up and
efficiencies, and clarity for the private sector, by these
functions being discharged in a joined-up way, and greater local
accountability.
(CB)
My Lords, LEPs and RDAs had in common that, while they referred
to “local” and “regional”, they were, in fact, Whitehall
appointed and Whitehall controlled. If their functions are
gradually transferred to mayoral authorities, that will clearly
take things closer to local enterprise, but it is not necessarily
a great improvement if you move from a Whitehall bureaucracy to a
mayoral bureaucracy. What is being done to ensure that these
functions respond actively to local enterprises and to local and
regional organisations, which are membership organisations and
directly represent enterprises, businesses, communities and,
indeed, consumers?
(Con)
My Lords, the Government have published guidance for the transfer
of LEP functions to local authorities. Further guidance will be
issued in January. As part of our devolution settlements in
different areas, there are also clear conditions around how
business engagement should take place to ensure that the voices
of local businesses and their representative organisations are
well heard in those areas.
(Con)
My Lords, is it not unusual that within local enterprise
partnerships, some of those participating were rivals with one
another? Is it not best to ensure that, after all this time, we
take another look at Redcliffe-Maud and have stronger bodies and
authorities, with more competent clerks, to make it a really good
and efficient system?
(Con)
One important aspect of moving LEP functions into local
authorities and mayoral combined authorities is making sure they
cover appropriate economic geographies so they can deliver for
those areas. In having proper democratic accountability, it will
be clear to local businesses and local people who is responsible
for economic development in their area.
(Lab)
My Lords, is it not clear that in the Teesside mayoral area, on
some of the economic development programmes, we have seen less
democratic accountability and less transparency about what is
going on? The Government instituted a review that was supposed to
report in July on this and we have heard nothing yet. We want
more electoral and democratic accountability and more
transparency. When is the report going to come out?
(Con)
My Lords, there has been a great deal of success in devolution to
Teesside and the mayoral combined authority there. The noble
Baroness is right that we have instituted a report into some of
the processes that have been undertaken. I do not have a date for
her, but we are looking at it very carefully and we will publish
the report when we are in a position to do so.
(LD)
My Lords, is the issue here not just talking about structural
change to functions but the power of the functions themselves?
The clear issue with saying that we are going to have proper
regional economic development firing on all cylinders is that, in
every country, every indicator shows that fiscal devolution is
required, not just the movement of existing functions. Will the
Government seriously look at fiscal devolution to ensure that
proper economic development can happen in all regions across the
country?
(Con)
That is exactly what the Government are doing; they are seeking
to combine the devolution of greater power with greater funding
and greater responsibility for the funding. There are the
trailblazer deals that look to integrate the different streams of
funding for local areas into something much closer to a single
settlement. That will allow those areas to make decisions at a
local level about what should happen in their area.
(Con)
My Lords, surely all this bureaucracy and red tape is not the
answer for some parts of our country that are in need of
development. As one of those involved in the establishment of
development corporations in the late 1980s, I think we should be
proud of such a model. Frankly, is it not about time we allowed
local businesses and local people to have a stronger say in what
they want to renovate and rejuvenate zones of that kind?
(Con)
My Lords, by integrating LEPs into local authorities and mayoral
combined authorities, we are looking to streamline the processes
by which business can engage in their local areas. As a part of
our devolution deals, we are also giving combined authorities the
power to set up development corporations so they can use the
voice of business to drive development and economic progress in
their local areas.
