A £1 billion Regional Growth Fund has been launched to help communities particularly affected by public spending cuts make the transition towards more private led economies.
Private bodies and public-private partnerships will be able to bid for funding by demonstrating that their proposal will bring in private investment and support sustainable increases in private sector jobs and growth in their area. The fund will run from 2011 to 2013.
Launching the fund in Bradford yesterday after the first Coalition Cabinet meeting outside of London, Nick Clegg said: “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.
“The Regional Growth Fund will create the conditions for growth and enterprise in the regions by stimulating investment and create sustainable private sector jobs.
“Alongside our commitment to waive some employment taxes for new businesses starting up in targeted regions of the country, this fund can make a real difference to companies during difficult times.”
Supporting this strategy, the ‘emergency’ budget last week revealed Regional Development Agencies are to be replaced by local enterprise partnerships which will place councils and businesses on an equal footing.
The partnerships will tackle issues including planning and housing, local transport and infrastructure, employment, enterprise and supporting business start-ups. Other roles currently carried out by the RDAs, such as inward investment, sector leadership, business support, innovation and access to finance, will be led nationally.
Business Secretary Vince Cable and Communities Secretary Eric Pickles have written to councils and businesses asking them to consider forming LEPs.
“If you want to rebuild a fragile national economy you don’t strangle business with red tape and let bloated regional quangos make all the decisions,” said Pickles.
“The solution needs to be local – we know that when councils and local business work hand in hand they can drive economic growth together and places can be transformed. Local enterprise partnerships are central to this vision which is why we are asking them what they need.
“By giving up central control we will put democratic accountability back into the local economy making it responsive to the needs of local business and local people.”
The Confederation of British Industry was supportive of the equal role of businesses in the new LEPs but “we need to see the new partnerships pursuing a practical, business-like agenda,” warned deputy director-general, John Cridland.
“This should cover all issues that directly affect growth, with planning, transport and skills at the top of the list,” he said.