Local Economies Saved by Analysis

In a fit of pre-Christmas generosity David Cameron has set aside £4m for individual LEPs to identify and analyse their particular local economic circumstances.

I’m not so big headed as to think that the PM took his lead from reading UK Regeneration in the run up to the holidays but we have been touting the modest proposal that a little funding ought to go to LEPs to help them get off the ground.  Unfortunately, the PM hasn’t quite done what we asked.  We wanted some start up support and he is offering research funding.

What Were They Thinking

This ‘Capacity Fund’ is only £4m over four years so don’t everybody rush at once.  Applicants will need to find match funding to prove that they are serious about analysing their particular local economic issues and opportunities.

What sort of woolly name is ‘Capacity Fund’ anyway?   I bet Eric the John Wayne fan wasn’t aware of this.  He’d have changed it into the ‘Back of a Fag Packet Fund’ with absolutely no money, just a webpage saying ‘Get On With It’ in big letters and a link to the National Office of Statistics website.

Retentive rather than inventive is my take on the Capacity Fund.  Instead of more local analysis I think LEPs would respond to a little practical help in their early days.  Approval to go forward should attract some core cost to cover nuts and bolts of organisation and project development rather than another round of research.  As Elvis didn’t quite sing, ‘A little less contemplation, a little more action please’.

The BIS Select Committee agrees,

‘For LEPs to be a success, the Government will also have to commit to devolving power where possible, and supporting LEPs in their start-up period both through appropriate financial support and retention of RDA know-how.’

In the absence of core funding then LEPs are most likely to be administered by local government in some form or another because this is where the resources, experience and statutory powers lie.  The private and third sectors may be willing but don’t have the capacity or resources to manage a LEP as well as participate in its leadership.

A modest funding allocation for LEP boards to administer for their own development is what is needed, perhaps requiring match and in kind from LEP participants.  However, the government has seen different and wants the money used for analysis.  Why?  When virtually every region and sub-region across the country has been analysed, re-analysed, assessed, bench marked, modelled and monitored to death (then buried, exhumed a year later and evaluated).

Quangos, local authorities, government departments, academia and an army of think tanks have given us huge amounts of spatial intelligence that LEPs can already draw on.  Alright, some LEP boundaries defy the existing logic but they can adapt current intelligence to their geography.

Genuine Partnership Has a Price

The pressing challenge is not a lack of information.  It is whether LEPs are going to become the agencies that will fulfil expectations and deliver sustainable regeneration and economic growth.  27 have now been given the go ahead but how many will be set up in a truly balanced cross sector manner?  It is looking like a very mixed bag of board membership across the first ones out of the traps.

The Third Sector appears to be the loser with little showing in most of the developing LEPs to date.  Community or other alternative business formation is not appearing among the developing LEPs.  That is unless we consider Lincolnshire’s LEP which has appointed the local Chief Exec of the Co-op as its chair.   Does that count as a divi for the third sector?

Complaint is rife that women and ethnic minorities are sparsely represented or not at all.  That is as much a reflection of the failure of public and private sectors to diversify at senior level but LEPs could be trying a bit harder to step beyond the old school approach.

What of the private sector?  Big business features heavily as it should especially in its role as economic driver, employer and investor.  Then we have a slew of Chamber of Commerce Chairs, Chief Execs of inward investment agencies and even the odd NHS and university bigwig masquerading as captains of industry.  Nottingham and Derby have given a private sector shadow board seat to a local home owner.  A common touch perhaps?  Not really, it’s the Duke of Devonshire and he owns a detached period resi called Chatsworth.  I suppose that makes him part of the tourism industry.

Out With the Old

This is a brave new world and LEPs have the opportunity to rise above the musical chairs of senior jobsworths by including a little variety and radicalism in their make up.  This brings me back to the point that a little seed corn funding for set up might generate some more imaginative approaches to LEP formation than the current offerings.

There is good and bad happening out there and time will tell which boards last and deliver.  It is inevitable that council leaders or their chief executives will want a seat and their experience, resources and mandate are key to success.  Nevertheless, acceptance of LEPs and their success will only come if local government is fairly balanced by non-public interest and expertise.  The blogosphere is lively with small firms and community organisations complaining about a lack of consultation and representation.  So bring on the private and third sectors and make sure that they are the real thing.  If your LEP wants to identify and encourage different and more diverse growth solutions then the board needs to reflect that aspiration.

Let us see different sectors and businesses to balance the suits and the usual suspects.  For every regional director of a retail food chain you need the iPhone app designer.  For every council leader you need the manager of the community business that will soon be running that council’s out sourced services.

This Capacity Fund is misnamed and misdirected.  Given the choice LEPs need resources to help them put the right structures in place and the right board membership to lead them rather than more economic analysis.  If you want to put some money into LEPs then start with helping them to become strong and representative.  A lot of the rest they can work out for themselves.

Richard Cohen