LEPs could take control of European funding

Paul Unger

The Government is proposing to offer local enterprise partnerships a greater role in the distribution of European development funds in the next round of the EU support programme.

A draft of the proposed new model will go out for formal consultation in spring 2013. The EU funds covered include the European Regional Development Fund, European Social Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund.

ERDF is the main pot for property development and infrastructure and was worth €755m to the North West during the 2007-2013 programme.

The value for the next spending period, 2014-2020, has not been decided but the Government says it wants a more efficient mechanism for distributing the funds.

Prior to the Coalition taking power in 2010, ERDF money in the regions was handled by Regional Development Agencies. The RDAs were disbanded by the incoming government and ERDF was taken over by Department for Communities & Local Government, albeit through a local committee structure. The LEPs were established as a sub-regional replacement of the RDAs. There are five LEPs in the North West: Cumbria, Lancashire, Cheshire & Warrington; Greater Manchester; and Liverpool City Region.

BIS said in a statement about the new model: "The proposals include ideas for using the different funds in a more complementary and integrated way. The Government also wants to make funding simpler to access and easier to operate for beneficiaries. Local Enterprise Partnerships will be invited to be more closely involved in the process of distributing the funds. LEPs would bring together local authorities and local businesses, and can therefore design and deliver investment strategies that target the needs of their local area."

BIS is currently presenting the ideas in a series of roadshows around the country, due to reach Preston on 17 December. This is the only scheduled North West visit.

  • Local Government representatives and other organisations have been invited to attend. If you wish to attend an upcoming road show please email: structuralfundsnegotiations@bis.gsi.gov.uk

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The UK coalition government’s thinking on devolving power to the provinces is fine in theory but based upon similar experiences in the past, is bad in practice. Putting billions of pounds in the hands of Local Enterprise Partnerships (LEPs) is acceptable as long as these funds are entirely strategically used and not provided for pet subjects or diverted to other ways and means by our Councils. The, ‘we know best brigade’ who never really know best as our stagnant economy shows clearly. In this respect the former Regional Development Agencies (RDAs) when analysed in-depth were pronounced a non-productive entity when it came to overall economic benefits and most of what happened would have happened organically according to independent reports. We do not want more of the same, but real change for new jobs and wealth creation. Indeed, as the primary mover of all new wealth is the commercial exploitation of ‘innovation’, LEPs have to concentrate on building the creative infrastructure first where all the creative thinking of local people can be brought to bear on the problem, not just academia and business whose combination has not faired that good economically over the past quarter of a century. In this respect also things will have to be much better than the NESTA which was supposingly to provide the UK with an independent avenue in providing the nation’s creative excellence. Indeed, the nation’s NESTA (set up by the last Labour Government and retained by the coalition government), the so-called national driver for economics excellence when it comes to innovation and where even after billions have been pumped into it over the last 15 years has created very little in the way of economic benefits, if any meaningful payback at all. In this respect the taxpayer’s money has been spent and little return in terms of jobs and new wealth creation has been the outcome. The identical case I consider will be the same old story with the LEPs. The reason in the case of the NESTA was that out of the seventeen trustees that were appointed only one was an engineer. The rest were celebrities and people who had not a clue how to create new technological industries (the things that we all need the most to change our economic and social fortunes around in the future). Even the NESTA’s chief executive was not an applied engineer or scientist but a linguist. How a linguist was appointed and understood what innovation was about is still a mystery to me. Here again like the old RDAs, the NESTA has failed and where no significant economic benefit has been forthcoming from the billions invested. Therefore the LEPs (which will have an equivalent NESTA agenda at their core) have to be different and where establishment people, pure academics, innovative illiterate businessmen, celebrities and political figures have not to be appointed to manage, set strategic targets (where they have no idea how the end game will pan out) and produce/implement bureaucratically controlled innovation system (the death knell for all creative thought and where Whitehall in particular is a past master of killing off the goose that laid the golden egg). If this happens again with the LEPs they will be another disastrous failure but where time again will have ticked-on and the UK will be even deeper in the economic mire than it is today. It is therefore imperative that we have ‘applied’ creative thinkers in the driving seat this time around and not non-performing minds that have not a clue what economic regeneration is all about anyway.

Dr David Hill
Chief Executive
World Innovation Foundation
Huddersfield, United Kingdom – Bern, Switzerland – Arlington, United States of

By Dr David Hill - World Innovation Foundation