Preview: Local Growth Deals

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This time next week we should (if all goes to plan) gain our first insight into how the chips have fallen in the allocation of the Single Local Growth Fund and what powers will have been devolved through the Local Growth Deals to Local Enterprise Partnerships.

The recently completed Wave 2 City Deals provide an insight into the kinds of things that may be devolved through Local Growth Deals as both should have as their reference document the relevant Strategic Economic Plan for each LEP area.

Across the Wave 2 Deals there was a general focus on infrastructure, a welcome sign from our point of view, along with a focus on other place based challenges such as housing supply and bringing land into use.

In most areas there is a commitment to tackling youth unemployment (which we would argue is also a placed based challenge) and a focus on improving the coordination of business support across local authority boundaries.

The figures for job creation in each City Deal should be taken with a pinch of salt given the recent report by the NAO into the Regional Growth Fund and Enterprise Zone job creation figures.

We've argued before that LEPs should really try to find other metrics that they have a direct impact on, if they are to demonstrate the impact of their programmes - jobs and GVA growth, while relevant, are difficult to directly attribute to their actions.

Significant numbers have been proposed for apprenticeship starts, we believe a watchful eye should be kept on this to ensure quality is prioritised over quantity. Too often when a measure becomes a target over time it fails to remain an effective measure.

The intangible benefits that can arise from greater cooperation between local authorities, to deliver more than simply on their own, is also evident in these Wave 2 City Deals.

Milton Keynes decided to incorporate their City Deal asks into the South East Midlands LEP Local Growth Deal submission rather than do one separately, so intertwined are the two processes. Others such as Bournemouth, Reading and Plymouth expanded their City Deals to take the opportunity to look at economic development beyond just their borders.

Outside the City Deals process, the newly created Combined Authorities in Liverpool the North East, Sheffield and West Yorkshire are welcome signs, as are the local authorities who have taken the step to come together and create a 'pool' to combine their associated gains from the business rate retention scheme.

Taken together this is a good start which will allow LEPs to prove themselves for more to be devolved in the future.

The alternative scenario is a big bang approach which places greater strain on LEPs to deliver more, at a faster pace. Should they fail to then live up to these increased expectations greater central government pressure could ironically see local plans being driven by central government targets as more would be at stake if plans fail to deliver.

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Head of Business Environment Policy

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