Radical approach will deliver growth, says Clegg
The government has outlined its plan for promoting economic growth across England and helping those that have been hit hardest by the public spending cuts. As business secretary Vince Cable confirmed that 24 LEPs in England had been accepted, deputy prime minister Nick Clegg launched the £1.4bn regional growth fund. Speaking to Insider, Clegg described the government’s actions as “a radical new approach”.
“We’re doing something completely different,” he said. “The regional development agencies had great intentions and some really good people working for them, but they were a bit remote. I think everyone accepts that.
“The people that create the jobs across England are the entrepreneurs and innovators. They’re the ones that can tell us better than any public sector organisation, civil servant in Whitehall or minister in Westminster what works best in their local area.
“We want to find a new way of providing support to them. That’s why we’ve created this fund and the LEPs.”
The new partnerships will be able to support local projects and bid for state funding, with the government targeting money at areas hit by public spending cuts. During a visit to Oldham yesterday, Clegg gave details about how the private sector can bid for money and what conditions will be attached.
Former Conservative MP and deputy prime minister Lord Heseltine will chair an independent advisory panel, which will consider all bids submitted to the fund and make recommendations to ministers on which to approve. There will be a minimum threshold of £1m and the first round of bids have to be submitted before 21 January.
“Some people think we’ve launched this too quickly but we want to get started as soon as we can,” said Clegg. “We hope this fund will work alongside other pots of money that are available – there’s European funding available, while the banks have finally set up their own pot of about £1.5bn.”
Speaking to Insider, Lord Heseltine said projects that suffered RDA spending cuts could be in line to secure cash from the regional growth fund. “We’re aware of a number of projects that are in a position to submit bids to the fund,” he said. "If they are good enough then they’ll receive the money. We can’t rule anything out.”
The government’s new White Paper on Local Growth also set out new proposals to look at ways for local authorities to keep the business rates they collect locally. Under the current system, more than £20bn of business rates collected by councils are pooled by central government and redistributed across all local authorities.
“We are simply balancing the books,” said Clegg. “If you don’t do that there’ll be bigger and more difficult decisions that will have to be made in the future. We have to wipe the slate clean so we can move on as a country.”
