Details start to emerge regarding abolition of RDAs and establishment of ‘Local Enterprise Partnerships’

Following the proposal to abolish the regional development agencies (RDAs) and replace these with Local Enterprise Partnerships (LEPs) included in the Queen’s Speech and the Budget, Vince Cable, secretary of state for business, and Eric Pickles, secretary of state for communities, have just written jointly to all local authority and business leaders setting out the key aims and criteria for LEPs and inviting authorities’ proposals by the 6th September 2010. For those who either haven’t seen the letter, or are only gradually catching up with this news (me, in both cases), the full text is here, on Dermot Finch’s Centre for Cities blog.

Some RDA functions — such as regional strategies — will be scrapped entirely; others — such as inward investment, responsibility for business support, and access to finance — are best led nationally, the letter says.

The letter also emphasises that one of the things LEPs must help address is the failure of some existing local and regional boundaries to reflect ‘functional economic areas’; LEPs should therefore be built on the ‘natural economic geography of the areas they serve’. LEPs will be joint local authority/business partnerships, chaired by prominent private sector figures (unless LEPs choose to be chaired by a mayor, which they can do). I understand that in Birmingham the hot issue currently being debated is whether Birmingham goes it alone or puts forward proposals for a LEP that reflects a larger economic area.

Interestingly, the letter also confirms the continuing importance of ‘small business start-ups’ to the coalition’s economic agenda.  In recent years this opinion has been strongly divided on the role and economic value of start-ups, with some coming down much more in favour of existing business growth rather than start-up as an economic driver. The conventional wisdom is achieving growth is quicker (and cheaper) than achieving start-up. The job and wealth creation also flows faster from business growth than from start-up.

Nonetheless, an emphasis on start-up should theoretically be good news as far as the provision of business support and advice is concerned. However, it is significant that so far there has been no mention at all of the Business Link service. Few that I have spoken to seem to expect it to survive in its present form. But it is interesting that the letter locates business support as a function best led nationally. One might have expected it to pass to the LEPs as a natural part of their enterprise responsibilities. We shall see.

However all this pans out, in LEPs we will have a new local structure to relate to, and a new set of people to whom we will need  to make the social enterprise case. Stand by.

  1. Sheva-Viv Reply

    Where I can I get hold of a copy of the Paper outlining the structure and remit of the LEP’s?



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