Business secretary Vince Cable has given the green light to 24 proposals for Local Enterprise Partnerships, out of 62 bids submitted so far. Vince Cable also confirmed the Business Link service would be shut down by the end of 2012 – read our analysis here.
These are the first wave of proposed Local Enterprise Partnerships to be approved and asked to progress to the next stage and include Greater Manchester, Leeds and Liverpool city regions. You can view the full list here.
Local Enterprise Partnerships are partnerships between councils and local businesses, designed to replace the current Regional Development Agencies. The idea is that the councils and local businesses will work together to stimulate private sector growth.
“The knowledge and expertise of the private sector, local authorities and their local communities will be crucial as we work to create a better environment for business and ensure that everyone has access to the opportunities that growth brings,” comments Vince Cable.
Vince Cable adds that he has been “delighted” that so many Local Enterprise Partnership bids have displayed “real imagination and initiative”.
At the same time, deputy prime minister Nick Clegg has announced that the new £1.4bn Regional Growth Fund is ready to accept funding applications.
The funding is targeted towards creating more private sector jobs in areas that are currently heavily dependent on government jobs.
“The measures set out in today’s white paper demonstrate the Coalition’s ambition to create a fairer and more balanced economy – one that is driven by private sector growth with business opportunities spread more evenly across the country and between industries,” says Nick Clegg.
But will they work?
All very well, but it remains to be seen whether the proof is in the pudding. Although the Coaliton’s ambitions are grand, we do have to be slightly cynical about how/whether the Local Enterprise Partnerships will work and whether they’ll be useful.
The lack of government funding for the Local Enterprise Partnerships begs the question of whether, in these cash-strapped times, local councils and local businesses will actually buy into them.
Vince Cable has been very clear that although the RDAs were funded by Whitehall, the Local Enterprise Partnerships will have little or no central government funding. Most of the Local Enterprise Partnerships are expected to apply for funding from the £1.4bn Regional Growth Fund, but they’ll be competing against some very strong private sector bids – and won’t receive preferential treatment.
If local businesses and councils don’t collaborate and invest in the Local Enterprise Partnerships, the model will fail before it even gets off the ground.
For all that the RDAs were costly, they did work. To some extent, at least. It would be a terrible shame if all regional help for local businesses were to disappear.