Regional imbalances to be examined by MPs

Bet our Local Enterprise Partnership has some “bigly beautiful” figures to support much more housing – fuelled by nuclear energy probably (bacause, as their hero Trump says – wind turbines cause cancer!).

“A parliamentary inquiry has been launched to examine the impact of regional imbalances in the UK economy.

The treasury committee is to examine the nature and impact of regional imbalances in economic growth across the country and the extent to which these explain poor productivity growth across the UK.

It will establish what regional data is currently available in the UK, how it could be used more effectively in policy development, and whether official regional economic forecasts should be produced.

MPs will seek to learn lessons from other countries on the use of regional economic data and forecasts, and understand how devolution has changed the need for regional data.

The effectiveness of regional bodies, such as combined authorities, in promoting growth will also be considered, as well as the extent to which the devolution of funding can help reduce regional disparities.

Treasury committee chair Nicky Morgan said that disparities between the areas represented by committee members had become “abundantly clear” in her time as chair.

“Whether it be a divide between north and south, towns and cities, or urban and rural, people experience the chasm which exists between various parts of the UK through their day to day lives,” said Ms Morgan.

That included differences not just in economic growth and income, but also in health and educational outcomes and the quality of infrastructure, she said.

“As part of this inquiry, we’ll examine why this is the case, what the effects are in terms of imbalances, such as wages and employment, and how successful regional programmes have been in promoting regional economic growth.

“The treasury committee will seek to identify the disparities and explore how better data can inform policy makers on how best to level the playing field.”

Committee member Alison McGovern said the inquiry would help build an accurate picture of how the economy affected people in different parts of the UK.

“We must understand how regional economic performance shapes people’s lives and their perceptions of where they live and work,” she said.

“It is not sufficient for the government to only offer figures on economic success in aggregate terms. I hope this inquiry can show how the government can get a full picture of the whole of the UK economy in the future.”

Written evidence will be accepted on the treasury committee website until 2 August.”

https://www.publicfinance.co.uk/news/2019/06/mps-investigate-economic-disparities-uk

Is our Local Enterprise Partnership attempting to hi-jack housing and infrastructure funding and control?

Yet another attempt by this unelected bunch of conflicted business people to suck up funding meant for local councils:

“…
Recommendations
2.1. 1.
That the Joint Committee pursue an area-based package to accelerate housing delivery which, at headline level, should include:

a. Resourcing of a strategic delivery team (capacity funding)
b. A major infrastructure delivery fund to unlock growth
c. A small schemes liquidity fund to bring forward stalled sites

2. That the proposed package as set out in appendix 1 is agreed as an
appropriate package to accelerate housing delivery across the HotSW
geography.

3. That the proposed package as set out in appendix 1 is used by officers as
the basis for future engagement with central government and its agencies in seeking to secure a bespoke deal for the HotSW area to structurally embed collaboration with central government on housing delivery.

4. That the Task Force seeks to now engage with senior figures within both Homes England and the MHCLG Growth and Delivery Unit to understand their appetite for driving growth and willingness to work with the Joint Committee on some kind of housing deal.

5. That the Task Force brings back any updates or progress to the Joint Committee to consider in due course.”

https://democracy.devon.gov.uk/documents/s26163/HotSW%20JC%20-%20Housing%20Task%20Force%20report.pdf

The appendix on pages 5 and 6 is particularly worrying.

And where does this leave the (stalled due to political changes) Greater Exeter Strategic Plan?

Why is the south-west (particularly our LEPs and press) backwards at coming forward on our behalf?

We are reading an awful lot in the press about how the north of England is being discriminated against compared to the south-east and London.

For example:

https://www.theguardian.com/uk-news/2019/jun/10/northern-newspapers-demand-revolution-in-regions-treatment?

Why does our local press and LEPs in the West Country appear to lack the ambition and drive to do something equally bold for our region?

Aren’t we in danger of being left behind (again). Owl thought LEPs were supposed to be leading us somewhere …not just spending our money on vanity projects.

“Nuclear: Energy bills ‘used to subsidise submarines’ “

Not just energy bills in Devon … a large tranche of our money is being used to subsidise Hinkley C via our Local Enterprise Partnership.

“Energy bills in the UK are inflated partly because households are subsidising nuclear submarines, MPs have been told.

Experts think one government motive for backing civilian nuclear power is to cross-subsidise the defence industry.

They say nuclear power is so expensive that it should be scrapped in favour of much cheaper renewable energy.

Others argue that nuclear still plays a key role in keeping on the lights, so the military aspect is not significant.

But in evidence to MPs on the Business Select Committee, researchers from the University of Sussex said the government should be frank about the inter-dependence of the civilian nuclear programme and the nuclear defence industry.

Supply chain

Prof Andy Stirling from Sussex argues that one reason the government is willing to burden householders with the expense of nuclear energy is because it underpins the supply chain and skills base for firms such as Rolls Royce and Babcock that work on nuclear submarines.

He said: “It is clear that the costs of maintaining nuclear submarine capabilities are insupportable without parallel consumer-funded civil nuclear infrastructures. …

The government has declined to comment on the research, but a committee source told BBC News the researchers’ evidence appeared persuasive and well-researched.

The committee is expected to release the evidence in coming days as it prepares to discuss whether the UK really needs nuclear power for energy security.

The debate has taken on greater significance as the true costs of nuclear power have been revealed.

It was once forecast that nuclear energy would be too cheap to meter. But it’s clear now that bill-payers will give price support to the Hinkley Point C nuclear station at a cost of £92.50 per megawatt hour, compared with £55 for offshore wind.

Ministers expect that, before long, wind energy will operate without support.

Prof Stirling says the issue of nuclear inter-dependence is addressed openly in the US.

In 2017, the former US Energy Secretary Ernest Moniz (a nuclear scientist) said: “A strong domestic (nuclear) supply chain is needed to provide for Navy requirements. This has a very strong overlap with commercial nuclear energy.”

Prof Stirling told BBC News: “We need this sort of transparency in the UK.”

Catch-22

But the government faces a Catch-22 situation on this issue.

If it continues to decline to admit the inter-dependence of civil and military nuclear, it will stand accused of hiding a self-evident truth.
But if it accepts that decisions on nuclear power are influenced with half an eye on manufacturing jobs and nuclear deterrent, it will face resistance from consumer groups unwilling to cross-subsidise submarines.

The MPs’ hearing is timely, as the government will shortly publish an energy white paper outlining how the UK will supply electricity in a zero carbon economy.”

https://www.bbc.co.uk/news/science-environment-48509942

Those optimistic “growth” figures from our LEP look even more unlikely

“Calling an organisation the “UK 2070 Commission” is not without its risks. Who cares what happens that far out?

But that, in a sense, is the point. The commission, set up to investigate Britain’s “marked regional inequalities”, publishes its first report today. And, as its chairman Lord Kerslake puts it: “If you want to understand what happens in economics, you need to look 50 years back and 50 years out.” Indeed, as the commission notes: “The reference to 2070 is an explicit recognition that the timescales for successful city and regional development are often very long, in contrast to the short-termism of political cycles.”

A Brexit-addled government nicely illustrates that — not that it’ll have been any surprise to Lord Kerslake, the ex-head of the home civil service. And in these distracted times, the report is doubly welcome. It kills the myth that inequality is not on the rise and helps to explain Brexit — or at least the disparity between Remainer London and the Brexiteer regions.

The report finds London “de-coupling from the rest of the UK”. And to nobody’s benefit. Research from Sheffield University professor Philip McCann finds the “UK is interregionally more unequal” than 28 of the 30 advanced OECD countries, the exceptions being Ireland and Slovakia.

Productivity in the capital is 50 per cent higher than the rest of the UK. Indeed, similar growth between 1992 and 2015 from cities outside London would have added at least “£120 billion to the national economy”. And, on present trends, half of the UK’s future jobs growth will be in London and the South East, which accounts for only 37 per cent of the population.

The effects show up everywhere. Healthy life expectancy in the UK’s poorest regions is “19 years lower”. The Joseph Rowntree Foundation found in 2016 that dealing with the effects of poverty costs the UK £78 billion a year. And, even then, poor is a relative term. The children’s commissioner for England found that “a child who is poor enough for free school meals in Hackney, one of London’s poorest boroughs, is still three times more likely to go on to university than an equally poor child in Hartlepool”.

No one wins from such imbalances. People and businesses in the North “miss out on the benefits of growth” — forcing more spending on benefits. But those in “overheating” London and the South East find “increasing pressures on living costs and resources”, so reducing “quality of life”. That forces spending on pricey infrastructure, exacerbating the imbalances. Hence Crossrail, a phase-one HS2 skewed to the capital and an environmentally damaging third Heathrow runway.

So, what to do? Well, here the commission suggests a mix of regional devolution and German-style national planning. It points to the eye-popping €1.5 trillion spent post-unification to help to bring east Germany up to speed with the west. For Britain, it proposes an extra £10 billion spend annually for the next 25 years: a fabulous sum equating to 0.5 per cent of GDP. Lord Kerslake says it’s for government to decide whether it would come from borrowings, tax or such things as levies on uplifts in property values.

Yet he reckons “higher regional growth rates would over time offset this cost”. He emphasises, too, that this is just an initial report, seeking feedback. And don’t the divisions over Brexit underline that Britain needs to do something? Waiting until 2070 isn’t an option.”

Source: The Times (pay wall)

Surprise, surprise: the business people running Local Enterprise Partnerships are not attracting funding – from business people!

As Owl has been saying for YEARS – THESE EMPERORS HAVE NO CLOTHES!!!!! Neither do they have transparency or accountability.

It’s verging on the corrupt, definitely a conflict of interest and is certainly unethical – it means a very, very few business people, taking no risks for themselves or their businesses, divvying up OUR money for their own pet projects, with almost no oversight from the councils they have robbed of funds and no loss for them if projects fail or over-run in time or cost.

A national scandal.

“Private sector firms are not matching public sector funding for local regeneration, senior civil servants have admitted.

Two senior civil servants at the Ministry of Housing, Communities and Local Government told MPs on Parliament’s Public Accounts Committee (PAC) that cash from the EU, public sector and higher education are still the main sources for funding regional development projects.

The department’s permanent secretary Melanie Dawes and director general Simon Ridley said match funding for the £9.1bn Local Growth Fund is largely dependent on match funding from councils and other public bodies.

Ridley also admitted there were still challenges over transparency and the boundaries of some Local Enterprise Partnerships (LEPs).

The LEPs were set up following the abolition of regional development agencies with the idea that they would be a partnership between business and local government – with an expectation that firms would help funding regional regeneration.

Ridley told the committee that the main private sector input into the LEPs is the time and expertise of board members who work for free.

Committee member Anne Marie Morris said: “Clearly, you are having the private sector involved, so how come you haven’t got a significant financial commitment from them?”

Ridley responded: “The capacity funding we give requires match from the LEP in different ways.

“A large number of business people on the boards do it without renumeration. A lot of the capacity support around the accountable body that the local authority provides is paid for by the LEP.

“Our core expectation was to set up partnerships between the private sector and local government to think about local area development.

“Some of those funding streams are matched by private sector funding schemes.”

Committee chair Meg Hillier asked if developers and construction firms were giving over and above Section 106 contributions to enable projects.

She said: “There is a danger that without having any skin in the game, businesses can walk away and local taxpayers end up picking up the bill.”

Ridley replied: “What the LEP is seeking to do is bring forward projects in the local area that wouldn’t otherwise be coming forward.

“They are often funded by more than one funding stream from the public sector.”

The committee also challenged the pair over a claim that LEPs tended to go to the top-five local employers and as a result, other firms were being left out of key decisions.

Oxford University has become a major decision-maker for its LEP, the committee heard.

Committee member Layla Moran asked: “How do we know that everyone who is a stakeholder in this money is actually involved in the decision?”

Hillier also questioned if the LEPs were accountable, citing Oxfordshire, where meetings were not being held in public.

Dawes said the use of scores in the LEPs annual performance review were conditional for funding being released and this had impacted on responses.

She said: “The real test is how it feels for local communities and I think that’s something that’s very difficult for us to judge in central government. We are on a bit of a journey here. It’s going to take a while.”

Ridley said local authorities had a crucial role in oversight, specifically through Section 151 officers who are ideally placed to deal with complaints.

He said: “All LEPs have got their complaints procedures. We have a clearer role realisation with the accountable body and the 151 officer, so they [the public] might write to them.

“The section 151 officer does have to get all the information that goes to the LEP board. I can’t personally here guarantee that absolutely all of that is in front of every scrutiny committee.”

Dawes confirmed the department has no metrics for assessing complaints being made about the LEPs.

MPs also raised concern about territorial battles between LEPs and combined authorities.

Decisions have still yet to be made about the boundaries in nine LEPs.

Dawes told the committee: “There are legitimate reasons why these geography questions are there. We are working actively with them.

“What ministers will have to work through is whether to impose a decision centrally.

“That would be a matter of last resort.”

Businesses failing on LEP match funding, MPs told

Local Enterprise Partnerships being better held to account? Not really

No evidence so far … Although LEP control is mostly with DCC, EDDC has an LEP role. Now we have a different councillor mix at EDDC we might get some answers about our LEP’s finances …..

“The National Audit Office has reported a significant improvement in the financial transparency of England’s Local Enterprise Partnerships (LEPs) after section 151 officers were given extra responsibility for ensuring that key data is publicly available.

But the public-spending watchdog has warned that the Ministry of Housing, Communities and Local Government’s unwillingness to evaluate the impact of the £9bn in Growth Deal funding channelled through LEPs since 2015 means it is unable to learn lessons on what has worked well. A total of £12 bn is committed to the fund by 2021.

Set up to drive economic growth as part of coalition government reforms introduced from 2011, there are now 38 LEPs in England, tasked with bringing together business and political leaders in a patchwork of sub-regional areas.

In its first report on their progress for three years, the NAO found a leap in the level of openness displayed by the partnerships, following concerns about financial transparency levels explored by the Ney Review, in 2017.

The NAO said that in 2016 only 13% of LEPs published financial data such as salaries on their websites, while only a third published their annual reports online.

As of February this year, 84% of LEPs were publishing their annual reports online and all gave financial information on the projects they funded.

The NAO said the improvements had followed an MHCLG and CIPFA drive to “set out stronger expectations” of the role of section 151 officers in assuring good financial governance of LEPs.

Section 151s now sign off monitoring information reported to the department.

Sign-off is also required for local assurance frameworks that confirm a LEP’s governance arrangements.

The drive came after the Ney Review’s 17 recommendations and is one of a series of initiatives addressing its findings.

Despite the improvements in transparency, the NAO report said MHCLG’s ability to make the most of opportunities presented by the UK Shared Prosperity Fund – created to replace EU economic development funding post-Brexit – would be hampered by its lack of understanding of LEPs success with the Growth Deals.

“We have previously reported that the department opted not to set quantifiable objectives for Growth Deals, including, for example, the number of jobs created,” it said.

“The absence of robust evaluation means the department and LEPs are less able to learn from what has worked well and ensure that this is reflected in the design or objectives of the new UK Shared Prosperity Fund.”

The report observed that that there was an “inherent tension” in the government’s need to develop a system of governance for a finance model that devolved funding and new responsibilities to ad-hoc business-led partnerships.

“While the assurance framework is stronger, backed up by checks on compliance, it is not proven yet whether these measures will be effective in detecting and responding to governance failures over significant sums of public money,” it said.

“The department’s accounting officer is accountable for the Local Growth Fund delivered through LEPs.

“However, the department has made no effort to evaluate the value for money of nearly £12bn in public funding, nor does it have robust plans to do so.

“The department needs a grip on how effectively these funds are used. It needs to act if it wants to have any hope of learning the lessons of what works locally for future interventions in local growth.”

Public Accounts Committee chair Meg Hillier said MHCLG had to ensure that huge sums of public funding were not wasted as it presses ahead with its devolved approach to delivering economic growth.

“It is too early to tell if the ministry’s remedial actions will get its governance up to scratch,” she said.

“Worryingly, the ministry also does not know if the funding is being used effectively to benefit local communities and businesses as intended.”

Last year the PAC called on MHCLG to implement the Ney Review recommendations and strengthen transparency and governance arrangements at LEPs following failings at the Greater Cambridgeshire Greater Peterborough LEP.

Concerns included the LEP’s relationship with local developers, and how it managed conflicts of interest. GCGP LEP went into voluntary liquidation in December 2017 after the department withheld funding from it.

This week’s NAO report notes that MHCLG “acknowledges that it cannot mitigate entirely the risk of a failure similar to the GCGP LEP”.

Boosted s151 officer role ‘significantly improves’ LEP transparency