East of England: Business groups welcome ‘local’ approach to growth and skills

Andy Wood, chairman of the New Anglia Local Enterprise Partnership

Andy Wood, chairman of the New Anglia Local Enterprise Partnership - Credit: Archant

BUSINESS groups have welcomed plans to devolve greater decision-making and spending controls to the country’s regions in a bid to boost jobs.

The Government today confirmed that it is accepting, either in full or in part, 81 of the 89 recommendations contained in Tory peer Lord Heseltine’s report No Stone Unturned, which was published last year.

Lord Heseltine’s report accused Whitehall departments and civil servants of having “stifled” growth outside London, and called for more decision-making in areas including transport, housing, and vocational training to be devolved regionally.

England’s 39 business-led Local Enterprise Partnerships (LEPs) will receive an immediate funding boost worth £500,000 over the next two years, to be spent on drafting plans on how best to create economic growth.

The Government will also create a single pot of money, the value of which has yet to be determined, from which LEPs will be able to bid for a share on a competitive basis from 2015.

Andy Wood, chairman of New Anglia LEP, which covers Suffolk and Norfolk, said: “We are pleased the Government is backing Lord Heseltine’s report which will enable more funding and decision making to be taken at a much more local level. Within the New Anglia LEP we are ready to embrace the opportunities these freedoms will bring our area.

“We have begun consulting on our Plan for Growth which will be central to the Growth Deal we will negotiate with government. We are working closely with local authority colleagues on the City Deals for Norwich and Ipswich which will be a key element in this process.”

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Susan Priest, a director at the South East LEP, which includes Essex, said: “This is a welcome vote of confidence in our business-led Local Enterprise Partnership.

“Business welcomes the opportunity to influence and secure much needed investment to bring about growth.”

Dr Priest added: “While it is disappointing a bidding process will be followed, we will press for a flexible system to be put in place that allows the business-led partnership to secure funds commensurate with the vast opportunities we have for growth in the South East.”

John Dugmore, chief executive of Suffolk Chamber of Commerce, said: “Firms across Suffolk will welcome the Government’s commitment to localise some funding and decision-making around transport and skills in order to unleash the enterprise and growth latent in local communities across the county and the rest of the UK.

“We commend Lord Heseltine for his dogged pursuit of a growth blueprint that promotes business and innovation and reduces dependency on Whitehall and Westminster.

“Over the coming months, the chambers of commerce will seek to ensure that local businesses have a strong voice in the new system, and that its overriding objective is to help areas generate wealth and prosperity.”

Katja Hall, the CBI’s chief policy director, said: “Ministers must pursue growth aggressively. The UK needs a robust, coherent industrial strategy that promotes trade and taps into business potential across the country, not just in the South East.

“The memories of failed 1970s industrial policies mean politicians have shied away from this area for decades, but this is a strong package and can give businesses the long-term confidence to invest, expand and export.”

However, while acknowledging the role of LEPs in respect of skills, she warned that localism was only a means to and end and it was vital that major programmes requiring a national or sector-based approach were not undermined.

In return for the granting of greater financial control, the Government will make LEPs set out their long-term plans in Local Growth Deals.

The Government has also backed Lord Heseltine’s suggestions for closer working between councils, civil servants, business leaders, schools and universities.

Not all the recommendations were accepted, with Lord Heseltine’s call for the Government to “clarify urgently” its position on increasing airport capacity in the South East rejected.

Chancellor George Osborne said Lord Heseltine was able to “challenge received wisdom and give us bold ideas on how to bring government and industry together. That is why we are backing him today,” he said.

Business Secretary Vince Cable said: “The plans will boost the UK’s competitiveness”.

He added there would also be further support for key industries, including the aerospace and automotive sectors.

Deputy Prime Minister Nick Clegg said Lord Heseltine’s report had set out “the best way” to boost regional growth.

“It’s a big change from the hand-out attitude of the past that stifled innovation and turned the regions into powerless centres that relied on Whitehall for jobs and spending,” he said.

Lord Heseltine said the decision to accept the most of his recommendations would allow England’s regions to “share in the rewards” of higher employment and greater prosperity if they could develop good enough economic strategies.

Communities Secretary Eric Pickles said: “Today’s response reinforces the local approach the Government is taking to grow the economy. Jobs are created in offices, on high streets and in industrial parks around the country, not in Whitehall.

“We are giving more power than ever before to Local Enterprise partnerships and councils to drive growth in ways that best suit their local economy, not through diktats from central government bureaucrats.

“This is also a challenge to councils to innovate, to come together and pool resources and functions, to better deliver economic development across their area.”