Mark Conrad 27 November 2017

Industrial Strategy snubs councils

Business secretary Greg Clark has snubbed councils and empowered local enterprise partnerships (LEPs) as the drivers of future local growth in the Government’s long-awaited Industrial Strategy.

Mr Clark’s blueprint for Britain’s economic growth, which has assumed greater importance due to Brexit, reveal ministers’ plan to kick-start Britain’s ailing economy in the period after its departure from the EU.

The blueprint outlines plans to boost flagging productivity and bolster businesses and private investment in parts of the economy which promise to deliver growth, jobs and tax income well into the 21st Century – including artificial intelligence, pharmaceuticals and clean energy.

Local industrial strategies are to be led by combined authority mayors where they exist across England, but for the rest of the country, LEPs have been handed the key role in delivering the same strategic economic plans.

Ministers want to agree the first local industrial plans by 2019, but local government experts have described the plans as a snub to councils, which were hoping for a greater role in delivering local growth.

Chief executive of think-tank Localis, Liam Booth-Smith, said: ‘The decision to give LEPs primary control for strategic economic planning is a disappointing, and a sub-optimal option for driving national growth and productivity.

‘There must be concerns about LEPs - rather than councils - gaining the central role in driving local industrial strategy.

‘Put simply, LEPs are not the right groups for this task.’

Mr Booth-Smith voiced concerns about the quality of leadership at some LEPs, arguing that they are ‘less well-equipped’ to deliver, and warned that the proposed structure means that it may take some time for local industrial strategies to be finalised – something, he argued, Britain cannot afford in the post-Brexit climate.

To help speed up sub-regional growth plans, Localis has called for those areas of the UK without devolution deals to be handed an ‘industrial compact’ allowing them to assume ‘full and immediate ownership’ of fresh economic powers.

Vice-chairman of the County Councils’ Network, Cllr Philip Atkins, and leader of Staffordshire County Council, said: ‘While the direction of travel is promising, this strategy could represent a missed opportunity and its aims may fall short in counties because of an over-emphasis on cities.

‘Counties ought to be in the driving seat to lead local industrial strategies - not just LEPs - while investment appears to be city focused.

 ‘County authorities already work closely with their own LEPs, but we have concerns they are not always the most effective bodies to dynamically lead local industrial strategies.

‘Counties contain the size to do business nationally and the intimate knowledge of their economies to grow communities locally while offering the democratic transparency that LEPs currently cannot.’

Mr Clark has said that local leaders could yet be handed greater responsibilities for local growth plans at sub-LEP level, claiming he would ‘consider’ striking deals with individual towns, for example.

Mr Clark has pledged a further £725m over three years through the Industrial Strategy Challenge Fund (ISCF) to boost regional growth and target specific sectors, and announced a string of ‘sector deals’ covering areas of the economy he wants to target for growth.

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