Written evidence from Alex Murray
Thank you for providing the opportunity to comment
on your Committee's Inquiry into the above, the attached paper
is offered as evidence to the Inquiry and is provided in a personal
capacity.
I have 25 years experience of working in the
field of economic development and regeneration encompassing the
associated disciplines of enterprise development and business
support, sectoral initiatives and innovation, vocational training
and access to employment. I have been employed in managerial and
other principal officer positions within both unitary urban and
rural local authorities including 10 years experience of working
within sub-regional partnerships.
For the majority of my career economic development
services have been delivered through partnerships of private,
public and third sector agencies, typically utilising a "cocktail"
of different funding streams, management and reporting requirements
and funded through local, regional, national and European level
programmes requirements.
Most recently this local authority and sub-regional
experience has been complemented by a national position as Economic
Development Adviser to the Improvement and Development Agency
(IDeA). I therefore was involved in a number of Government policy
initiatives such as the new duty placed on upper tier authorities
to undertake an economic assessment of their area, guidance to
support areas combating worklessness/work and skills plans and
acting as local government lead for the Building Economic Resilience
theme of the new Local Innovation Award. I worked closely with
officials in key Whitehall Departments and a conduit for advice
on implementation of new policies to practioners in local authorities
and partner agencies responsible for delivering enterprise, economy
and employment related services at the "coalface".
I am a full member of the Institute of Economic
Development and would be delighted to provide oral evidence to
the Inquiry if needed.
INTRODUCTION
The Government has quickly set about developing
its "Localism" policy agenda and proposals for Local
Enterprise Partnerships (LEPs) should be seen as one of the core
elements of the devolution of "decision making" down
to the local and sub-regional level. This is welcome and undoubtedly
LEPs can better reflect how local economies actually function
in comparison with their Regional Development Agency (RDA) predecessors.
SPECIFIC TOPIC
AREAS OF
THE INQUIRY
1. The functions of the new Local Enterprise
Partnerships and ensuring value for money
I consider an assessment of current arrangements
such as the plethora of different agencies and their associated
reporting lines and funding is critical to avoid the mistakes
of the past where the private sector are, more often than not,
totally confused by the range of "public funded agencies"
offering elements of enterprise and business support and development
services. The previous administration "streamlined"
the number of "products" available via the Solutions
for Business(S4B) portfolio but for the small enterprise looking
for advice their first point of call, certainly for general advice,
would be their solicitor/accountant. What is the "market
penetration" of the S4B portfolio amongst these potential
advocates of the service, I suspect very little!
A range of benchmarking measures should be established
during the development phase that could be used as value for money
"comparators" amongst groups of LEPs that display similar
characteristics and/or are "statistical neighbours".
2. The Regional Growth Fund, and funding
arrangements under the LEP system
This Regional Growth Fund (RGF) must bring together
the fragmented funding streams, channelled through various agencies
which should reduce duplication and bureaucracy as a matter of
course. At the same time the fund needs sufficient flexibility
to allow specialist "sub-regional" sectors to develop
and grow, "one size does not fit all". As an example
in the early 1990s Whitehall funding streams were merged into
the generally agreed successful Single Regeneration Budget (SRB)
programme, this provides a successful template for a similar "single
pot" arrangement for enterprise and economic development.
Merge various Whitehall Departmental budgets
for local economic development into the new RGF with flexibility
built in to take into account local conditions. As an example,
in areas with "over reliance" on the public sector more
emphasis may be needed on promoting an enterprise culture/entrepreneurship
to develop a long-term sustainable private sector.
3. Arrangements for co-ordinating regional
economic strategy Structure and accountability of LEPs
The regional economic strategies made little
sense in terms of how economies operate and I see little reason
for the need to coordinate arrangements for Regional Economic
Strategies. LEPs will undoubtedly want to formulate an appropriate
strategy that makes sense for their "natural of functioning
economic area" and may wish to cooperate with neighbouring
LEPs; this voluntary cooperation should be encouraged. The new
duty placed on upper tier local authorities to undertake an economic
assessment of their area should provide an ideal foundation for
the development of a LEP economic strategy to which all key partners
from private, public and third sector involved can contribute
and "sign-up" to and subsequently align their services
to deliver to the key objectives and priorities
1. In developing their economic strategy
LEPs should take account of the relevant RDAs economic strategies.
2. Voluntary co-ordination between neighbouring
LEP areas should be encouraged.
We should be very careful not to spawn a whole
new bureaucracy in terms of structure and accountability of LEPs.
A persistent criticism of RDAs (and other quangos such as Learning
and Skills Councils) was their lack of democratic accountability.
Therefore, a leading role for elected members of the local authorities
involved in LEPs which will operate across administrative boundaries
is essential and will provide a strategic fit with the wider "localism"
agenda promoted by the Government. However as the thrust of the
policy is to stimulate private enterprise and growth it seems
sensible for the chair of the LEPs to be a private sector nominee
with other representation from the private sector being reflective
of sectoral strengths within the LEP area.
Building upon existing local structures such
as those of the local authorities and the Local Strategic Partnerships
should be encouraged.
More importantly will be the functions of the
LEPs and what current services will be "subsumed" into
both their direct control and "sphere of influence".
1. A thorough and wide ranging review of
services and projects that support enterprise development funded
from local authorities, education institutions, RDAs, as well
as individual Whitehall Departmental should be examined. It
should be noted Local Economic Partnerships and Local Employment
Partnerships already exist in areas and care must be taken not
to further confuse the private sector.
2. Bringing together housing, transport and
planning functions to support the work of the LEPs will be a major
challenge, inviting consortia of local authorities in a LEP area
to "market test" how this will operate is recommended.
4. The legislative framework and timetable
for converting RDAs to LEPs, the transitional arrangements, and
arrangements for residual spending and liability of RDAs
Dependent on existing levels of cooperation
areas will all be at different stages (eg in Multi-Area Agreement
(MAA such as Greater Manchester and Leeds City Region should be
more advanced) so some form of transitional arrangements are sensible.
Perhaps an 18 months period until April 2012 should be considered,
to coincide with the negotiations for successor arrangements (if
any) to the current round of EU Structural Funds ending in 2013
which its emphasis on enterprise and economy?
An evaluation of liabilities and committed spending
of RDAs should be commissioned
5. Means of procuring funding from outside
bodies (including EU funding) under the new arrangements
Note response in 4 immediately above regarding
EU funding.
August 2010
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