Memorandum submitted by South East England
Regional Assembly
1. INTRODUCTION
1.1 In addition to addressing the specific
areas for inquiry outlined by the Select Committee, the South
East England Regional Assembly (hereafter "the Assembly")
reiterates our fundamental concerns regarding the Government's
Review of Sub-National Economic Development and Regeneration (SNR)
proposals[221]
(i) Democratic accountability: We continue to
oppose the transfer of strategic planning to unelected Government
quangos and the dramatic reduction in local accountability this
entails. We press instead for principal local authorities (counties,
unitaries and districts) collectively to be given primary responsibility
for preparing the new integrated regional strategy. Failing that,
the South East's new Regional Development Agency (RDA) board should
comprise nominees from local government alongside central Government
appointees, in a "shared agency". In either instance
the skills and experience of stakeholders, such as those currently
engaged with the Assembly, should be drawn upon in developing
the strategy.
(ii) Sustainable development: We are concerned
by the SNR's overriding emphasis on economic targets for the new
integrated regional strategy. There is an urgent need to strengthen
RDAs' sustainable development duty and to ensure that their responsibilities
for economic, environmental and social wellbeing are given equal
priority.
(iii) Delegation of delivery: We are concerned
that the SNR's promise to empower local authorities in delivering
economic development will come to little. Councils need the resources
as well as the freedom to shape and lead economic development
in their areas.
(iv) Stakeholder involvement: We have made the
current system of stakeholder participation work well and the
outcomes have been substantially stronger as a result. The SNR
reveals very little appreciation of the positive contribution
stakeholder participation has made to regional policy making.
(v) Resources: Whoever ultimately undertakes
Regional Planning Body functions in future, adequate Government
funding must continue. We estimate it costs around £3.1 million
per year to undertake this role effectively at present. The costs
associated with the wider scope of a single integrated strategy,
as proposed by SNR, would be even greater. If RDAs are expected
to take on new responsibilities without transfer of resources,
either the new job will not be done properly or their existing
work will suffer, or both.
1.2 The Assembly has worked closely with
SEEDA and, through our scrutiny process, developed a good understanding
of its performance. Our submission is therefore based on our experience
of working with SEEDA. I would be very happy to give oral evidence
to the Committee and discuss these issues further.
2. THE NEED
FOR A
LEVEL OF
ECONOMIC DEVELOPMENT/BUSINESS/REGENERATION
POLICY DELIVERY
BETWEEN CENTRAL
AND LOCAL
GOVERNMENT
2.1 We believe there is a clear need for
a level of policy delivery between the national and the local
to address regional issues. The mandates of central Government,
whose concerns can be characterised as predominantly strategic
and economic, and local government, which tends to focus more
on place and quality of life, interface at the regional level.
Effective regional policy balances national imperatives for growth
and global competitiveness with local priorities for improved
services, infrastructure and environmental quality. It is therefore
essential that local authorities and other partners are central
to policy development, including economic development.
2.2 The significance of a regionally-specific
approach is demonstrated by the different approaches adopted in
each region. In the South East we have benefitted from a joint,
collaborative approach, in particular in working towards a single
delivery plan, which has ensured strategic priorities are aligned.
Our work can be seen as a precursor to the development of a single
integrated strategy. Likewise, the success in the South East of
the Regional Transport and Housing Boards—both of which
are partnership boards involving Assembly members, RDA board members
and other key interests—has shown that there is significant
added-value to be gained from working together at the regional
level.
3. THE EFFECTIVENESS
OF RDAS
AND THEIR
ROLE IN
ADDING VALUE
3.1 From our scrutiny of SEEDA's interventions,
they seem to be valued most where they support and enable local
level delivery. We have found that SEEDA is often able to add
real value to local projects by providing leadership, catalysing
action, delivering match funding or leveraging investment into
particular sectors and localities. For example, the Manufacturing
Advisory Service is seen as a successful programme delivering
tangible benefits to industry and meeting the needs of the companies
it works with.[222]
Similarly, SEEDA is frequently commended for its work in regeneration
priority areas such as Hastings.
3.2 However, there appears to be a range
of operational challenges which continue to limit the effectiveness
of SEEDA. We consistently find concerns about the quality of SEEDA's
communications, a perceived lack of transparency in decision-making
and concern that SEEDA's cross-department working needs to be
improved, with an oft-cited concern that area and functional teams
operate in silos. We appreciate SEEDA is undertaking considerable
internal changes to address these types of concerns.
3.3 We are also concerned that central Government
funding for SEEDA is inadequate for it to tackle the challenges
in the South East, the second most populous of the English regions.
Addressing this, and wider issues of funding for infrastructure,
is critical if we are to maintain our position along with London
as the economic powerhouse of the county. Per capita, SEEDA has
the smallest budget of any RDA, yet the task it faces in sustaining
the critical contribution of the South East to the national economy
(and the largest net contribution of any region to the Exchequer)
is arguably the greatest of any region.
4. RDA EXPERTISE
4.1 The RDAs are executive agencies, with
skill-sets predominantly focused on delivering interventions on
the ground. SEEDA has developed expertise around particular sectors
and localities, in line with its current remit. SEEDA's teams
have been commended for their specific expertise; our recent select
committee into SEEDA's activities in the coastal South East, for
example, found that area teams' understanding of local issues
was welcomed.[223]
Equally, when examining SEEDA's response to the challenge of globalisation,
partners were generally happy with the service provided by relevant
SEEDA programmes.[224]
4.2 Whilst this skill-set may be appropriate
to the current RDA remit, it will prove inadequate if Regional
Planning Body functions are to transfer to RDAs. In particular,
SEEDA's current focus on project delivery means there is limited
capacity to deliver strategic policy development and to navigate
the difficult political decision-making inherent in such processes.
5. THE EXTENT
OF, AND
NEED FOR,
RDAS' OVERSEAS
ACTIVITIES
5.1 The South East is an international economy
and therefore the global economy is an important dimension of
SEEDA's work. We have first hand experience of the value of SEEDA's
efforts to influence the European agenda, having shared a small
team in Brussels. This shared approach was a constructive use
of limited resources. However, we have limited direct knowledge
of SEEDA's other overseas operations and seek clarity on their
added-value and how decisions are made regarding where and when
overseas interventions are appropriate.
5.2 In our select committee examining SEEDA's
response to the global challenge, partners suggested it was difficult
to isolate SEEDA (or any other partner) as being solely responsible
for attracting foreign investment. Many felt that the businesses
drawn to the region would have chosen the South East with or without
SEEDA interventions. This view was compounded by the fact that
new businesses tend to be drawn to strong areas of the region[225]
rather than areas performing less well, which arguably have a
greater need for new businesses. SEEDA apparently has little ability
to influence these decisions.
5.3 Our select committee found clear support
for SEEDA's joint work with the RDAs in the East of England and
London on the "Greater South East". We support such
joint inter-regional approaches where they are able to make best
use of resources and avoid duplication. Joint working could also
be utilised more effectively within the region. A more coordinated
approach with local and sub-regional partners conducting overseas
activities could lead to better resource utilisation and minimise
duplication.
6. THE CONSEQUENCES
OF EXPANDING
RDA REMIT TO
INCLUDE NEW
FUNCTIONS, AS
PROPOSED BY
THE SUB-NATIONAL
REVIEW, INCLUDING
THE DELIVERY
OF EU FUNDING
6.1 We fundamentally oppose the transfer
of Regional Planning Body functions to the RDAs. The SNR proposals
could have significant consequences:
(i) Democratic deficit: The transfer of Regional
Planning Body functions to RDAs marginalises democratically elected
councillors from key planning decisions. Local authorities may
be unwilling to provide democratic ownership for a regional strategy
they had limited involvement in developing, thus risking its legitimacy
and threatening delivery.
(ii) Sustainable development: A single strategy
prepared in a context of primacy for economic objectives may fail
to meet the principles of sustainable development. An unsustainable
regional strategy could have significant impacts for communities
and the environment in the South East and threatens long-term
economic growth.
(iii) Delegation of delivery: We are concerned
that the SNR's promise to empower local authorities in delivering
economic development will come to little. Councils need the resources
as well as the freedom to shape and lead economic development
in their areas. RDAs have an important supportive role to play
but regenerating and sustaining the prosperity of local economies
demands above all communities that are active and empowered through
their locally elected representatives. Delegation must be real;
RDAs must let go.
(iv) Stakeholder involvement: Stakeholder participation
"within the tent" of regional decision-making has enhanced
wider community engagement with, and ownership of, the South East
Plan. In limiting stakeholders' formal role in single strategy
development, the SNR threatens these benefits.
(v) Resources: There is a risk that if current
Regional Planning Body funding does not transfer with the functions
either the new job will not be done properly or existing work
will suffer, or both. We estimate it costs around £3.1 million
per year to undertake this role effectively at present. The costs
associated with the wider scope of a single integrated strategy,
as proposed by SNR, would be even greater. SEEDA may have to divert
funds from economic development duties to deliver the new functions,
which is particularly concerning given the Assembly's planning
budget as a percentage of the RDA's budget is probably the greatest
of any region (given the relatively small size of SEEDA's budget
in comparison to most other RDAs).
6.2 As an organisation SEEDA does not currently
possess staff with the skills and/or capacity to prepare and deliver
regional planning, housing and transport policies or the range
of related Regional Planning Body functions, such as monitoring
and conformity. We have a significant and parallel concern that
the expertise within the Assembly, highly valued in the region,
may be lost as a result of the uncertainty arising from SNR. We
also recommend that this Select Committee consider the findings
of the Communities and Select Committee which has recently reported
on its inquiry "Planning Matters—Labour Shortages and
Skills Gaps".[226]
6.3 The SNR under-estimates the complexity
of achieving regional democratic ownership of a regional strategy,
as indicated by the wholly unrealistic timescale proposed in "Prosperous
Places". SEEDA does not currently have sufficient skill and
experience in brokering agreement on strategic policy and delivery
priorities across different political groups, geographical locations
and constituencies of interest. Neither does SEEDA have sufficient
experience of wide-spread engagement and consultation with the
public. The significance accorded to public engagement in the
development of regional planning policy is demonstrated by the
different levels of input received throughout the South East Plan
and RES development: for the main South East Plan consultation
in 2005 we received 95,200 responses, whilst SEEDA received 500
written responses to the RES consultation.[227]
7. THE ACCOUNTABILITY
OF RDAS
7.1 The current arrangement for our scrutiny
of SEEDA has contributed to strong and close working relationships
between the two organisations. It has also gone some way to address
the lack of democratic accountability inherent to all RDAs. However,
scrutiny and accountability should not be considered one and the
same. Regional scrutiny is one element (albeit a vital one) which
could help to ensure accountability in post-SNR arrangements.
However, accountability is also dependent on good governance;
accountability should be built in to all elements of the new arrangements
and not bolted on as scrutiny at the end of the process. Accountability
must be more than a tick box exercise.
7.2 Similarly, future arrangements for regional
local authority-led scrutiny of the RDA must be properly resourced.
Without the resources of the current assemblies, the ability of
the local government forum to scrutinise effectively will be constrained.
There will be little interest amongst busy local authority leaders
in participating in weak and poorly resourced scrutiny arrangements.
Stakeholder representatives have played an extremely active role
in RDA scrutiny in the South East, yet their experience and interest
risk being lost as a result of SNR.
7.3 The proposals for future accountability
"down" to the region and its communities are far too
weak. They are seriously insufficient given the significance of
regional planning, which demands far stronger transparency, scrutiny
and accountability in future. In a recent survey commissioned
through Ipsos MORI[228]
South East residents were asked who they thought should be involved
in setting regional priorities and taking regional decisions on
large scale planning, housing and transport developments. Results
show that residents have a clear and strong preference for priority
setting and decision making to be led by accountable local councillors.
7.4 While local authority representatives
were clearly residents' first choice to be involved in setting
regional priorities—chosen by 73%—there was also support
for other groups. Some 60% wanted to see community representatives
involved, while 38% mentioned local business representatives,
34% mentioned environmental groups and 24% mentioned the voluntary
sector. This emphasises the need for formal arrangements for stakeholder
involvement in the future.
7.5 However, residents' views hardened when
asked who should be involved in decision making—75% chose
local councillors as their first or second choice to be involved
in regional decisions on planning, housing and transport. Around
a third of people (34%) chose voluntary/community sector representatives
as their first or second choice. Further down the scale, 22% put
regional business representatives in first or second place—the
same number that chose civil servants working for a Government
appointed regional organisation. The desire for accountability
is clarified further by residents' responses on ultimate responsibility
for regional decision making. Again, local councillors were first
choice with 41% support, followed by central Government with 35%
support. Much further down the scale were civil servants working
for a Government appointed regional organisation (9% support).
7.6 We believe that stronger accountability
could be provided through stronger governance, such as that suggested
in our proposal to make SEEDA a "shared agency", with
a board comprising 50% local authority leaders and 50% ministerial
appointees, and a more open approach to decision-making. A joint
venture will increase accountability to the region and enhance
confidence in the regional policy-making process. This proposal
could help allay public concerns implied by our Ipsos MORI polling
outlined above. Residents also showed a clear willingness for
the wider community to be involved in, at least, setting priorities.
We would therefore like to see SEEDA create formal mechanisms
that ensure regular stakeholder input into its work at all levels,
which will also strengthen its accountability to the region.
7.7 The proposal for Parliamentary regional
select committees may help strengthen RDAs' accountability to
central Government. However, it does nothing to resolve the need
to improve accountability to the regions. Further, we are concerned
that the proposals fail to provide the means for examining the
impact of Government policies on the region. There seems to have
been an assumption that Parliamentary scrutiny would look at the
region and regional institutions. We suggest strongly that the
Parliamentary telescope should turn through 180 degrees and look
at the impact of central Government policies and investment on
each region. This would seem a more sensible and less duplicative
approach given RDAs are already subject to inquiry by the Business
and Enterprise Committee.
8. HOW RDA PERFORMANCE
HAS BEEN
MEASURED IN
THE PAST
AND WILL
BE MEASURED
IN FUTURE
8.1 Performance measurement should be one
element of accountability, but it is important that the two are
not considered one and the same. We are therefore disappointed
that Government believes RDAs in future should primarily be held
to account through a central Government performance framework.
This does not equate to true accountability (see comments in section
7).
8.2 The performance management framework
only provides accountability upwards to Government, rather than
dealing with the important dimension of how accountability to
the region is secured. We are also concerned that the RDA monitoring
framework is dominated by central Government targets, with insufficient
scope for regionally-specific targets agreed with regional input
and therefore owned by the region as a whole.
8.3 We also believe that performance measurement
must measure the RDAs' delivery of all three elements of sustainable
development—environmental, social and economic—and
not simply the economic performance of their region. This is already
a significant concern, and one recognised by SEEDA, but becomes
increasingly important if Regional Planning Body functions are
to pass to RDAs.
16 September 2008
221 Our full response to the "Prosperous Places"
consultation can be found at:
http://www.southeast-ra.gov.uk/subnational_review.html Back
222
See our select committee's report at www.southeast-ra.gov.uk/committees_select_9.html Back
223
See our select committee's report which will be available on our
website
(www.southeast-ra.gov.uk/committees_select_2008-02.html)
once agreed in September 2008. Back
224
See our select committee's report at http://www.southeast-ra.gov.uk/committees_select_3.html Back
225
See SEEDA's "South East Foreign Direct Investment Report,
2006-2007", available from SEEDA Back
226
http://www.publications.parliament.uk/pa/cm/cmcomloc.htm Back
227
South East Plan figures provided by the Regional Assembly. RES
figures as quoted in the RES 2006-16. Back
228
The findings of this survey are available on our website: www.southeast-ra.gov.uk/polls.html Back
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