By Lucy Phillips
01 July 2010
The government is pressing ahead with its pledge to radically cull the number of quangos, with regional development agencies among the latest in the line of fire.
Deputy Prime Minister Nick Clegg this week set out plans to replace RDAs with ‘local enterprise partnerships’, made up of councillors and businesses. The new bodies will oversee planning and housing, local transport and infrastructure, employment and support of business start-ups.
Other roles carried out by RDAs, such as local business support and innovation, will be controlled centrally.
Business Secretary Vince Cable said the new bodies would play a vital role in ‘rebalancing the economy towards the private sector’. LEPs would ‘take on the task of renewing local economies and tackling local barriers to growth’, he said.
But Katie Schmuecker, senior research fellow at the Institute for Public Policy Research North, told Public Finance that there was ‘an element of giving with one hand and taking away with another’. She added that some of the newly nationalised functions were better carried out at local level.
The Centre for Cities think-tank said that RDAs had a ‘disappointing record’ on generating private sector jobs and LEPs would need to do better. Chief executive Dermot Finch said: ‘This is localism in action... The ball is now in the court of local councils and businesses.’
The Labour Party, which established RDAs in 1998, immediately condemned the government’s decision. ‘RDAs have done a good job for regional economies. They have been independently evaluated and shown to lever in on average £4.50 of benefit for regional economies for every £1 spent,’ said shadow business secretary Pat McFadden.
Clegg also announced a £1bn fund to support private sector growth in regions heavily dependent on public sector jobs and likely to suffer most from the public spending cuts.
‘While we sort out the nation’s finances, we can also help to foster a thriving and more balanced economy so that no region or community gets left behind,’ he said.
Schmuecker said the new fund was a welcome recognition that ‘the private sector does not automatically flourish in the public sector’s place’. But she warned that growth in regions reliant on the public sector would take a long time, risking a ‘timing difficulty if the public sector cuts happen very quickly’.
Details on the LEPs and the fund will be published in a white paper this summer.
The Commission for Rural Communities, set up to boost economic growth in the countryside, and the new Infrastructure Planning Commission will also be abolished, ministers said this week.
01 July 2010
The government is pressing ahead with its pledge to radically cull the number of quangos, with regional development agencies among the latest in the line of fire.
Deputy Prime Minister Nick Clegg this week set out plans to replace RDAs with ‘local enterprise partnerships’, made up of councillors and businesses. The new bodies will oversee planning and housing, local transport and infrastructure, employment and support of business start-ups.
Other roles carried out by RDAs, such as local business support and innovation, will be controlled centrally.
Business Secretary Vince Cable said the new bodies would play a vital role in ‘rebalancing the economy towards the private sector’. LEPs would ‘take on the task of renewing local economies and tackling local barriers to growth’, he said.
But Katie Schmuecker, senior research fellow at the Institute for Public Policy Research North, told Public Finance that there was ‘an element of giving with one hand and taking away with another’. She added that some of the newly nationalised functions were better carried out at local level.
The Centre for Cities think-tank said that RDAs had a ‘disappointing record’ on generating private sector jobs and LEPs would need to do better. Chief executive Dermot Finch said: ‘This is localism in action... The ball is now in the court of local councils and businesses.’
The Labour Party, which established RDAs in 1998, immediately condemned the government’s decision. ‘RDAs have done a good job for regional economies. They have been independently evaluated and shown to lever in on average £4.50 of benefit for regional economies for every £1 spent,’ said shadow business secretary Pat McFadden.
Clegg also announced a £1bn fund to support private sector growth in regions heavily dependent on public sector jobs and likely to suffer most from the public spending cuts.
‘While we sort out the nation’s finances, we can also help to foster a thriving and more balanced economy so that no region or community gets left behind,’ he said.
Schmuecker said the new fund was a welcome recognition that ‘the private sector does not automatically flourish in the public sector’s place’. But she warned that growth in regions reliant on the public sector would take a long time, risking a ‘timing difficulty if the public sector cuts happen very quickly’.
Details on the LEPs and the fund will be published in a white paper this summer.
The Commission for Rural Communities, set up to boost economic growth in the countryside, and the new Infrastructure Planning Commission will also be abolished, ministers said this week.
