Minister: Local Enterprise Partnerships lack “a clear focus” on growth

In a searing critique of government policy, business minister Mark Prisk has written to his boss, Vince Cable, warning that the introduction of Local Enterprise Partnerships (LEPs) across England to replace the eight regional development agencies has generated “considerable friction” from the business community, running the risk that they “become detached from this policy heralding likely failure [of LEPs] in large parts of England”.

In a searing critique of government policy, business minister Mark Prisk has written to his boss, Vince Cable, warning that the introduction of Local Enterprise Partnerships (LEPs) across England to replace the eight regional development agencies has generated “considerable friction” from the business community, running the risk that they “become detached from this policy heralding likely failure [of LEPs] in large parts of England”.

In a leaked letter in yesterday’s Times (£), Prisk says:

“There is a strong view amongst the business community that many LEPs lack the ambition to make significant economic impact, undermining our agenda for growth.”

The letter goes on:

“Key messages I have been made aware of include a lack of credible business representation; negotiations dominated by local politics; and a lack of a clear focus on economic growth.”

Mr Prisk, a long-time opponent of regional development agencies, is an unlikely emissary of such tidings, however the timing of his letter is instructive. It was written on 14 September, the week after the deadline for local authorities and businesses to submit proposals for LEPs. Prisk’s initial examination of the bids showed that “attempts to engage business have been cursory in too many circumstances”.

Knowing what he knew, Mr Prisk nevertheless told the Northern Regeneration Summit in Manchester on 12 October:

“So let’s be very clear: LEPs will succeed only if the local business community is right at their heart, shaping the vision and setting priorities for action. That is a key criterion against which all applications are being assessed.”

By the terms of the minister’s own leaked letter, LEPs have failed before they have even begun, reinforcing the point made by CBI director-general, Richard Lambert, that the process to date has been a “shambles”.

This led to just 24 out of 62 LEP applications getting approved last week, leaving whole swathes of the country (21 million people, according to figures compiled by the House of Commons Library for shadow business secretary, John Denham) at a serious potential economic disadvantage as the government’s new Regional Growth Fund opens for business.

As Left Foot Forward pointed out last week, LEPs are a solution no one seems to want. Unfortunately ministers have been hell-bent on sloppy ideological policy-making and are now waking up too late to the fact that LEPs, shorn of the regional development agencies’ £2.3 billion budget and larger operating scale, are simply not up to the task of supporting regional economic growth.

As Mr Denham put it:

“It’s crystal-clear the government has no coherent strategy for growth. The hasty and dogmatic changes they are ramming through are making the position for businesses worse.”

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