Annex
Letter of 29 June 2010 from the Secretaries of
State for Business, Innovation and Skills and for Communities
and Local Government to Local Authority Leaders and Business Leaders
Dear Colleague
Local enterprise partnerships
We are writing to you to invite you to work with
the Government to help strengthen local economies. The Coalition
Government is committed to reforming our system of sub-national
economic development by enabling councils and business to replace
the existing Regional Development Agencies. The purpose of this
letter is to invite local groups of councils and business leaders
to come together to consider how you wish to form local enterprise
partnerships.
We are working with the Regional Development Agencies
(RDAs) to enable this transition. We are reviewing all the functions
of the RDAs. We believe some of these are best led nationally,
such as inward investment, sector leadership, responsibility for
business support, innovation, and access to finance, such as venture
capital funds. Some of their existing roles are being scrapped,
such as Regional Strategies. The forthcoming White Paper on sub-national
economic growth will set out our approach in more detail.
Separate arrangements will apply in London, where
discussions are currently underway with the Mayor of London on
how we can further decentralise powers, particularly in the context
of the abolition of the Government Office for London.
We are determined that the transition from the existing
RDAs be orderly, working to a clear timetable.
Meanwhile, we are keen to encourage local businesses
and councils to work together to develop their proposals for local
enterprise partnerships. We want to encourage a wide range of
ideas, and to aid that, we would suggest some parameters.
Role
We anticipate that local enterprise partnerships
will wish to provide the strategic leadership in their areas to
set out local economic priorities. A clear vision is vital if
local economic renewal is to be achieved. The Coalition Government
is determined to rebalance the economy towards the private sector.
We regard local enterprise partnerships as being central to this
vision.
Partnerships will therefore want to create the right
environment for business and growth in their areas, by tackling
issues such as planning and housing, local transport and infrastructure
priorities, employment and enterprise and the transition to the
low carbon economy. Supporting small business start-ups will therefore
be important. They will want to work closely with universities
and further education colleges, in view of their importance to
local economies, and with other relevant stakeholders. In some
areas, tourism will also be an important economic driver. Further
details will be set out in the forthcoming White Paper.
Governance
To be effective partnerships, it is vital that business
and civic leaders work together. We believe this would normally
mean an equal representation on the boards of these partnerships
and that a prominent business leader should chair the board. We
would, however, be willing to consider variants from this, such
as where there is an elected mayor responsible for the area, if
that is the clear wish of business and council leaders in the
partnership area. The governance structures will need to be sufficiently
robust and clear to ensure proper accountability for delivery
by partnerships.
Size
We have been concerned that some local and regional
boundaries do not reflect functional economic areas. We wish to
enable partnerships to better reflect the natural economic geography
of the areas they serve and hence to cover real functional economic
and travel to work areas.
To be sufficiently strategic, we would expect that
partnerships would include groups of upper tier authorities. If
it is clearly the wish of business and civic leaders to establish
a local enterprise partnership for a functional economic area
that matches existing regional boundaries, we will not object.
We will welcome proposals that reflect the needs of every part
of England, not least areas that are economically more vulnerable.
Government is keen to work closely with and through capable local
enterprise partnerships which meet these criteria.
Going forward
As set out in the Budget, we will publish a White
Paper later in the summer, which will set out the Government's
approach to sub-national growth. Legislation to abolish RDAs and
enable local enterprise partnerships was announced in the Queen's
speech and is expected to be introduced to Parliament in the autumn.
We would therefore welcome outline proposals from
partnerships of local authorities and businesses, reflecting the
Coalition Government's agenda, as soon as possible, and no later
than 6 September.
| 
