Monday, October 11, 2010

LEP changing spots already?

It is a sign of the quiet conflict going on between Eric Pickles and Vince Cable that the ground rules on the Local Enterprise Partnerships is shifting rapidly. Partly, that may be because they started with only the vaguest idea of what a LEP might be and have used the various bids submitted to firm that up and develop some concept of a common framework, or it might be a sign of a genuine tension between the localism of Pickles and the regionalism of Cable.

Pickles let slip to a fringe meeting which LEPs looked to be greenlighted (although if anyone believes that this was anything other than intentional, you are spectacularly naiive) and Cable's BIS then backtracked, saying that nothing was set in stone - perhaps because Cable had mentioned a few days earlier that only a handful of bids were viable. David Bailey from Coventry University has been keeping a close eye on things and adds his take and report here.

Pieman Pickles then decided that if the LEPs want it, they can also have control of inward investment, business support and skills funding - items previously held by the RDAs, but slated to return up the chain to some sort of 'regional hub' under the Cable project. This 'regional hub' looks an awful lot like a mini-RDA in exile, waiting for the right moment to leap back into action, but Pickles seems determined to throttle it out of existence right now.

We've also been told that the LEPs will not be funnels for the Regional Growth Fund, which is to be distributed straight to deserving businesses, but Pickles said
there is a misunderstanding that LEPs will just receive money from the regional growth fund. We would not be setting up such an elaborate structure just to distribute £1bn. Without wishing to paraphrase Ronald Reagan, £1bn is neither here nor there... Their function is to push money and sovereignty to local authorities and get some enterprise cracking.

The danger here is that the LEPs were designed to be business-led, not to act as funding generators for local authority economic development teams. If they are perceived as merely an extension of local government, then I'm afraid that businesses aren't going to want to be involved, especially given the glacial movement of most local authorities over actually doing anything - a genuine frustration for anyone used to fast-moving business environments. If the businesses pull out or just pay lip service to the LEPs, turning up for the occasional lunch meeting, then the whole structure will prove completely worthless.

Aside from all this, it is fascinating to watch the dance between the Department for Communities and Local Government and the Department for Business, Innovation and Skills. I suspect that there is a broader agenda here on the part of Eric Pickles and it is to render BIS nothing more than a shell. Many are tipping Vince Cable to be the first Lib Dem to walk out from the Cabinet, but he might yet find that his seat disappears from beneath him.

Another political figure in for a surprise is Boris Johnson, who thought that he had secured the London RDA responsibilities for the GLA and Mayor's Office, but BIS and CLG have asked the London boroughs to put together LEP bids, although Allister Hayman reports that they will have a particularly high bar to reach to show that they add value. The Local Government Chronicle also reports that Alderman Pickles isn't having it all his own way. He is believed to have strongarmed Kent and Essex into submitting a joint LEP, against their own plans, and now all bar one of the 14 backbench Conservative MPs in Kent have agreed that this proposal is a bad one and may actually cost jobs within the county.

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