15 February 2011

Looking locally

Regional development agencies are dead - long live local enterprise partnerships. Paul Fanning asks Greg Clark, minister for decentralisation and planning policy, what the new bodies mean for manufacturing

One of the earliest acts of the current government was to announce the scrapping of the regional development agencies (RDAs) that had previously overseen central government's support for business. While this was far from unanticipated, the announcement in June last year nonetheless sent shockwaves through engineering and industry as businesses faced uncertainty as to the nature of their future relationship with government. As minister for decentralisation and planning policy at the Department for Communities and Local Government, Greg Clark (pictured) is directly responsible for aspects of this policy and feels that RDAs will not be missed. "I think actually that towards the end of the life of the RDAs, there was a widespread feeling that they were very imperfect and often rather cumbersome institutions that didn't necessarily reflect the potential of some of the local economies they were supposed to serve. I think there was a general desire for change.. By the end, I don't think there were many defenders of the RDAs left." The organisations tasked with filling the gap left by RDAs are local enterprise partnerships (LEPs), designed to allow smaller regions to work together in areas of common interest rather than under the monolithic aegis of the RDAs.

The logic behind this, claims Clark, is simple: "When we asked people what kind of local enterprise partnerships they wanted, it came across very clearly that, while they wanted to work closely with regional neighbours, they wanted to have a clear focus on the skills and capabilities of the region itself. That came out very strongly and I think was suppressed by the previous arrangement." Given this government's expressed desire to rebalance the economy, it would seem logical to assume that LEPs will favour manufacturing, but Clark says there is no intention to dictate such a course. "For a lot of them, the basis of their bid has very much been about the fact that there hasn't historically been enough concentration on those areas. But the direction comes from the bids themselves... That was always the intention. Rather than central government saying to the regions what activities they should be pursuing or how they should be organising themselves, businesses can get together on the basis of shared interests and government will support them." That is not to say, however, that this government is not seeking to aid manufacturing where possible. "If you look at the things that help existing companies to prosper and expand, or are important in attracting overseas investment, there are two really important things - one is skills and the other is the whole environment for planning. "We know that the planning system is a real source of bureaucracy and cost. So we want to make it more intelligible and pro-growth for manufacturers and technological businesses to expand and relocate. The planning responsibilities in my department will play a big part in that. "

This attitude, Clark emphasises, reflects a more general concern by government for the future of UK manufacturing. "I think there's a huge enthusiasm for manufacturing and engineering within government," he says. "Look at the strengths we have: take the energy industry, for example. We know that within the UK, but also around the world, we are in the early stages of a real energy revolution, whereby in most developed countries, a lot of capacity was laid down in the 50s, 60s and 70s and now needs replacing. That's a huge challenge and a huge opportunity...Our industrial heritage in terms of the process industries, precision engineering and marine engineering are precisely the skills and abilities that are needed to prosper in those areas. So there is not only a need to rebalance the economy, but also a very real sense of excitement about the way the world is going, where high-tech manufacturing skills are going to be required. We are very well placed to have more than our fair share of that."

Paul Fanning is editor of WM's sister magazine Eureka

Paul Fanning

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