“A revolution in the way our economy is run.” That’s what the government called the recent £6 billion funding round for England’s 39 Local Enterprise Partnerships (LEPs). Those bold words could place huge expectations on promising organisations that were established just three years ago, but LEPs represent an opportunity for real change.
LEPs are voluntary partnerships between businesses, local authorities and councils, which have been given funding and powers so they can transfer control away from London and towards regional businesses and local authorities.
The reasoning is simple: who could be better than local people when it comes to deciding how to tackle issues such as skills shortages and small business support, and improving planning and transport infrastructure? LEPs are designed to end an unbalanced national economic reliance on London, and empower cities and localities across England to shape their own destiny – creating jobs, skilled workers and thriving businesses. A revolution in the regions could finally end the culture of ‘Whitehall knows best’.
Supporters of the approach – which now includes the leaders of all the major parties – believe LEPs will stop over-centralised power being allowed to support national institutions while ignoring the regions and the reality of business on the ground.
A meeting of business minds
The UK’s Local Enterprise Partnerships (LEPs) were established in 2011 by the Department for Business, Innovation and Skills to support economic growth and job creation within local economies, replacing the old Regional Development Agencies.
Many businesses may not yet have heard about Local Enterprise Partnerships (LEPs), but they represent a bold attempt to arrest the long-term trend in economic centralisation by rebalancing strategic influence over the factors of production in favour of the speeds and needs of the business coalface.
LEPs seek to blend local business leadership with local authorities to review the hard economic evidence and prioritise – given the limited available resources – what needs to be done, and in which order, to shift the jobs and growth dials in each local area. That could mean an LEP in the Midlands focusing on business support in advanced manufacturing, while an LEP near Cambridge works on the development of skilled tech workers and inward investment.
Funding for freedom
LEPs will start work in earnest in 2015/16 with delegated authority over an initial £2 billion per annum. However, there is a clear cross-party aspiration for further devolution of funds and freedoms to empower places to make better, faster decisions on matters of local economic importance that impact directly on jobs and growth. This represents a possible return to making common sense common practice. That is, by focusing more on integrated, long-term, evidence-led strategies at the level of individual places, and focusing less on well-intentioned national policies and institutions that fail to take into account the economic realities in the regions.
Involving the private sector in this drive towards localism is crucial. Business combines the benefits of labour, land and capital. The availability of a skilled workforce, the right infrastructure and access to finance are all needed for job-creation and economic growth, and these areas are all reflected in the strategic economic plans outlined in the government’s guide for LEPs .
Local authorities and LEPs are natural allies in the need to rebalance aspirations towards those investment opportunities that result from localism. In this regard, it helps that LEP boards benefit from more than 200 active senior business leaders, including Nick Pulley, Regional Director of Santander Corporate Bank, who will chair Leicester and Leicestershire Enterprise Partnership for the next 12 months. He calls it “one of the highest-performing LEPs in the country”, the LLEP having bid for £250 million from the government's £2 billion Regional Growth Fund. Officials also say the money would likely attract £2.5 billion of private sector funding and create 45,000 jobs.
It is the blended mix of experience, skill and perception from the public and private sectors that lies at the heart of the potential for LEP-added value. The point of LEPs is for us to take a more balanced and timely localised look at the relative importance of different factors and to build for the future, not just pacify present anxieties.
It is crucial for businesses and policymakers to remember that LEPs are inherently eclectic in terms of size, priorities, opportunities, governance, politics and business base. It would be a mistake to adopt a common network-wide approach to LEP relationships, but most involved in the organisations acknowledge the need to strike the right balance between one-off local solutions and great practice, so as to avoid 39 reinventions of the wheel. Going some way to remedy this is the LEP Network, of which I took over chairmanship as of this year.
LEPs may be the new kids on the economic block but they have strong cross-party support and look set to be an increasingly important locus for influence on all growth matters. I wager we are more likely to leave the EU or see the collapse of the Euro than to witness the demise of LEPs within the next nine years. It therefore makes sense for every business to get involved with their local LEP. Visit the LEP Network’s directory map and click on the relevant geographical link to find out which LEP covers you. Each page provides information on any relevant Enterprise Zone that could benefit your business, as well as contact information, web and social media links.
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