Local Enterprise Partnerships or Local Enterprise Politics?

August 2nd, 2010 | 5 comments Source: BAD News

At the end of June, Ministers Vince Cable and Eric Pickles wrote to local authorities and business leaders, asking them to submit proposals on how best to form LEPs, which will take over some of the responsibilities of England’s eight Regional Development Agencies (RDAs), excluding London, which will be axed by March 2012.

And last week, Business and Enterprise Minister Mark Prisk hosted a roundtable meeting attended by a wide range of representatives, including some from local authorities, the Confederation of British Industry (CBI), Federation of Small Businesses (FSB), the British Chambers of Commerce (BCC), Centre for Cities, the Local Government Association (LGA) and Institute of Directors (IoD).

Following the meeting, the Government said it anticipated some LEPs will be in place by the end of 2010 so they can shadow RDAs but, according to Cable and Pickles, will only take on some of the responsibilities of RDAs. LEPs will oversee planning, housing, transport and infrastructure, employment, and enterprise and business start ups, while the responsibility for inward investment, sector leadership, innovation, access to finance and business support will shift to Whitehall.

An unnamed source told the Local Government Chronicle (LGC) that, while the meeting was very positive overall, some attendees were concerned that centralising responsibility for inward investment, business support and leadership would be detrimental to the growth of the UK economy.

The Government also announced at the end of June that it was setting up a £1 billion Regional Growth Fund which would help areas affected by public spending cuts. However, it is still not clear how this fund will relate to LEPs and there will be no clear information on how LEPs will be funded until the Government publishes a White Paper, which is due “in the summer”.

However, information about the geographic location of LEPs is starting to take shape. The LGC has published an up-to-date summary of the current geography of LEPs.

It has also been confirmed by the Government that the BCC and the FSB will both “have a central role to play” in the delivery of LEPs. Mr Pickles met with representatives from both organisations and later announced that they will help to form LEPs with local councils.

Initial rhetoric about LEPs has suggested that, following the scrapping of RDAs and Business Link, there would be clearly devolved responsibility for enterprise and business support down to a local level, with accountability restored and bureaucracy minimised.

But does the ambiguous statement that ‘business support’ will be centralised in Whitehall, with enterprise and start up support localised through councils and the private sector, suggest a recipe for local versus centralised politics? And while there will be a welcome end to regional bureaucracy, there is a danger that the bureaucracy will remain in 30-odd ‘new’ regions/local areas, resulting in a postcode lottery for many small businesses.

In theory, LEPs should deliver more openness, accountability and devolved responsibility, but in practice this will certainly be with less money, and could ultimately result in even more decisions being made in Whitehall.

Although there is officially meant to be a ‘deadline’ of 6 September for submission of public and private sector partnership proposals to form LEPs, it seems that some national organisations’ involvement has been confirmed and cemented already (the FSB and BCC) with little transparency over that particular decision-making process and their remit.

If you have any comments or opinions on the proposals to form LEPs please leave a comment below.

For more information on the timetable for LEPs click here.

For more on Mr Pickles meeting with the BCC and the FSB click here.

To read Vince Cable and Eric Pickles’ letter click here.

Also in BAD News this week:

  • FSB issues tax warning for new self-employed
  • Department of Health review to abolish care sector regulators
  • Government announces major overhaul of Licensing Act
  • Scrapping retirement age will cripple small firms, says FPB
  • Legal expenses insurance should not limit choice of lawyer, says FSA
  • Half of employers welcome flexible working legislation
  • Treasury launches nine tax consultations
  • FSA replacement will face greater scrutiny
  • First Minister announces loan fund for east of Scotland
  • Government announces modernisation of UK digital infrastructure
  • Consumer confidence falls for first time in a year
  • Construction workloads fall for tenth consecutive quarter
  • Government pledges to reform ATOL system
  • UK tourism sector set to grow 60% over next decade
  • Government grants charities temporary reprieve from music licensing fees
  • Recession to have lasting impact on eating out sector
  • Guidance on health and safety in the workplace

5 Responses to “Local Enterprise Partnerships or Local Enterprise Politics?”

  • Just been pointed towards this article and although it is a couple of years old it really does make perfect sense. For me partnerships all the way.

    Comment was posted on Thursday, February 9, 2012 10:42 am
  • Voluntary and community organisations are the backbone to the UK economy. Business people never share their success, unless for a high price. Voluntary and community orgs help, advice and empower for the good of everyone. It is vital they play a role in the LEPs

    Comment was posted on Wednesday, September 8, 2010 4:42 pm
  • GWE Business West is working with local authorities and other partners across Bristol, Bath, Gloucestershire, Swindon and Wiltshire to help shape the form and function of these LEPs. As a business representative organisation we are committed to engaging fully in the future economic development of our area and ensuring ambitious growth targets are both set and achieved as part of this process. We encourage everyone in the business community to make their voice heard, to speak to local politicians and other businesses to ensure the business voice is loud and clear on the key aims of LEPs – GDP growth, private sector job creation and economic diversity/vitality and the need for LEPs to remove the barriers to achieving these aims.

    Comment was posted on Wednesday, August 4, 2010 1:42 pm
  • A great opportunity to cut through the layers of cost imposed by the RDA’s. LEP’s need to be made up from the business community who can bring a fresh approach and not from those who have prospered under the old regime. The government must be careful that chambers are capable of delivering it is my experience is that this is often not the case.

    Comment was posted on Tuesday, August 3, 2010 4:42 pm
  • paul scott

    Local??? I don’t think so. Same people round the same tables. Looks like a re-invention of the TEC’s to me but bigger. What a lost opportunity for micro businesses and start ups.

    Comment was posted on Tuesday, August 3, 2010 11:42 am

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