Posted on:
19th July, 2020

Independent report concludes longer-term funding needed to support LEPs

A new research report from the independent Industrial Strategy Council, 'Understanding the policy-making processes behind local growth strategies in England', concludes that: "...there is a clear need for a commitment to longer-term funding to support LEPs in building policy making capacity."

Independent report concludes longer-term funding needed to support LEPs

The report provides insight into the policy-making processes behind Local Industrial Strategies (LISs). The research undertaken for the report identifies areas of good practice, and common challenges, emphasising their wider relevance to debates regarding the implementation of future local economic growth policies in five areas:

  1. Purpose – There is a need for better communication and understanding between central government and Local Enterprise Partnerships (LEPs). There is widespread understanding about the purpose in principle of LISs but less of an understanding to what this means in practice.
  1. Process – Local stakeholders thought that the process has worked well locally and LEPs are well placed to coordinate sub-national economic policy. Improvements should still be made in terms of co-production with government, and inter-LEP policy co-ordination. Uncertainty related to future funding and government policy impeded the process of developing LISs.
  1. Collaboration - Collaboration was the strongest theme identified in this research LEP staff are well embedded locally, are aware of local strengths and challenges and have good working relationships with key local stakeholders. Local areas consulted widely with a range of diverse stakeholders, including local businesses, academia, and local authorities. Most interviewees believed the development of LISs was a constructive exercise that focused minds on achieving common goals.
  1. Prioritisation – There is a widespread appreciation of how data can drive prioritisation processes alongside stakeholder engagement. However, evidence reviews were mostly conducted by external consultants indicating lack of analytical capacity in LEPs. A partial solution to this issue is to improve access to the latest regional data and academic research.
  1. Evaluation –  Robust evaluations are a cornerstone of understanding “what works” and making informed funding decisions. However, there was little focus on ensuring robust policy evaluations locally. There is a disjoint between the long-term nature of evaluation and short-term funding cycles. Central government and LEPs/Combined Authorities should work together to agree a minimum analytical requirement in LEPs, including both staff and evaluation spend.

Andy Haldane, Chair of the Industrial Strategy Council said:

‘Covid is likely to increase the importance of the Government’s levelling-up agenda.  As this research report from the Industrial Strategy Council demonstrates, making a success of levelling-up will require a significant investment in capacity and capability at the sub-national level.’

Christine Gaskell, member of the Industrial Strategy Council said:

‘Local Enterprise Partnerships and Combined Authorities are well-placed to develop local economic policies, but some of them are under-staffed and under-funded. Our research clearly reinforces the importance of key messages of the Council's Annual Report - scale, longevity and policy coordination. Funding of local policies and institutions needs to be proportionate to the size and the long-term nature of the challenge that is "levelling up". National coordination of Local Industrial Strategies needs to be improved to ensure that local policies are greater than the sum of their parts. Local institutions are at the forefront of policy delivery and will have to play a greater role in the near future, if we want to see an effective recovery from the COVID-19 economic crisis.’

Kate Barker, member of the Industrial Strategy Council said:

‘This study demonstrates that local coordination and enthusiasm have been significant positives in the development of Local Industrial Strategies.  But now the LEPs and Combined Authorities are looking for evidence of coordination and enthusiasm from central government in response.  The combination of the Covid crisis and Brexit uncertainties should not become a reason for delay from Whitehall, which needs to support local leaderships to maintain this positive momentum.'

A full copy of the report is available here.