Osborne tweaked funding for growing occupiers, often used to unlock new premises, with the abolition of Regional Growth Fund to be replaced by the £12m Local Growth Fund, and introduction of a £400m Northern Powerhouse Investment Fund using European structural funds, subject to clearance from Brussels.
The budget for the Local Growth Fund, initially a £2bn-a-year pot created following the Heseltine Review in summer 2013, was confirmed yesterday at £12bn between 2015-16 and 2020-21. LGF is administered by Local Enterprise Partnerships, which will continue to receive admin funding from government, matched by local areas.
Osborne said: “This is a major step forward in giving local areas greater control over public spending – the Local Growth Fund is more than double the combined size of the Regional Growth Fund, Growing Places Fund and City Deals in the last Parliament.”
Greater Manchester’s allocation of the Local Growth Fund is £533.3m, Lancashire’s, £251.1m, Cheshire & Warrington’s £157.9m, Cumbria’s £47.7m and Liverpool City Region £263.9m. The largest allocation of any area is Leeds city region with £627.5m.
So far the LGF has been spent on projects such as the £40m life sciences inward investment fund from Greater Manchester LEP in partnership with Cheshire & Warrington, 12 additional light rail vehicles for the Metrolink network, the creation of the Nuclear Technology Innovation Gateway in Cumbria, and improvements to the entrance to Knowsley Industrial Park.
The new Northern Powerhouse Investment Fund will pool EU regional cash with Government funding. Greater Manchester Combined Authority said it secured “greater influence and decision-making powers over €415m of European funding to ensure it is aligned with local priorities and maximise the benefits to Greater Manchester’s economy.”
There was also £22m for international trade missions specifically to promote investment opportunities for foreign money into the North, as trailed by James Wharton, minister for the Northern Powerhouse at the Conservative Party Conference in October.