Selecting towns for the Towns Fund Contents


The £3.6 billion Towns Fund was introduced at pace by the Ministry of Housing, Communities and Local Government (the Department) in summer 2019. It relied upon Ministers selecting which towns would receive funding from a ranked list prepared by officials. The Department claims it had good reasons for this approach, but we are not convinced by the rationales for selecting some towns and not others. The justification offered by ministers for selecting individual towns are vague and based on sweeping assumptions. In some cases, towns were chosen by ministers despite being identified by officials as the very lowest priority (for example, one town selected ranked 535th out of 541 towns).

The Department has also not been open about the process it followed and it did not disclose the reasoning for selecting or excluding towns. This lack of transparency has fuelled accusations of political bias in the selection process, and has risked the Civil Service’s reputation for integrity and impartiality. We are therefore disappointed that, although the Department’s Permanent Secretary confirmed he was satisfied the selection process met the requirements of propriety and regularity, a summary of his Accounting Officer assessment remains unpublished.

It is still far from clear what impact the Department expects from the Towns Fund, when it expects to see the benefits, and how it will measure success both at the town level and across the whole programme. The Department says that it wished to give money to towns which it deemed unlikely to have the expertise to succeed at bidding for funding through an open competition; which also raises concerns about whether those towns will have the capacity to spend the money well. The impact of Covid-19 is also likely to mean that some towns will need to reconsider how best to spend the money, and that financially stretched towns will find it even harder to come up with match funding.

By experimenting with a different approach to local investment and bypassing existing structures the Department was taking an innovative approach. This makes it even more important for the Department to monitor the programme, identify and encourage what works, and act when things go wrong. With much remaining unclear about how the programme will be delivered or how the Department will oversee progress, we will be expecting regular updates from the Department so we can hold it to account for how it has used taxpayers’ money.

Published: 11 November 2020