Payday for projects to boost regional business

The ‘Regional Growth Fund’ was launched today by Deputy Prime Minister Nick Clegg. The fund, which will operate in 2011/2012 and 2012/2013, will target communities that are most dependent on public sector employment, and therefore at risk of being affected by public spending cuts.

Both private bodies and public-private partnerships will be able to bid for funding by demonstrating that their proposal will bring in private investment and support sustainable increases in private sector jobs and growth in their area.

Speaking in Bradford after the first Coalition Cabinet meeting outside of London today, Mr Clegg said: "While we sort out the nation's finances we can also help to foster a thriving and more balanced economy so that no region or community gets left behind.

"The Regional Growth Fund will create the conditions for growth and enterprise in the regions by stimulating investment and create sustainable private sector jobs.

“Alongside our commitment to waive some employment taxes for new businesses starting up in targeted regions of the country, this fund can make a real difference to companies during difficult times."

Full details of the Regional Growth Fund, including who will be eligible to apply, and the criteria and process for assessing bids, will be set out in a forthcoming 'White Paper' on local and regional growth.

Mr Clegg also set out plans to invite councils and business to join together to form 'local enterprise partnerships' that will provide strategic leadership in to improving their communities' economic health. These partnerships are planned to replace the current Regional Development Agencies (RDAs).

Business Secretary Vince Cable and Communities Secretary Eric Pickles today sent a joint letter to councils and business leaders, asking them to consider forming local enterprise partnerships and to put forward their ideas about what is required locally to boost economic activity and growth.

Mr Cable said: “We are determined to rebalance the economy towards the private sector, so it’s important we create a more effective structure to drive economic growth and development across the country.

“We want a structure that reflects the genuine interests and commitment of enterprise, local councils and other stakeholders like universities and colleges... Today we are asking them to tell us about their vision and I’m looking forward to what they’ve got to say."

Mr Pickles said: "If you want to rebuild a fragile national economy you don’t strangle business with red tape and let bloated regional quangos make all the decisions.

“Urgent action is needed to rebuild and rebalance local economies so that new businesses and economic opportunities spread across the country.

"The solution needs to be local - we know that when councils and local business work hand-in-hand they can drive economic growth together and places can be transformed.

"By giving up central control we will put democratic accountability back into the local economy making it responsive to the needs of local business and local people."

The government expects to introduce the legislation allowing the transition from RDAs to local enterprise partnerships to Parliament in autumn.

Parties interested in forming local enterprise partnerships should submit outline proposals by 6 September to: Local Enterprise Partnerships, Economic Development Directorate, Department for Business, Innovation and Skills, 1 Victoria St, SW1H 0ET; or by emailing: LocalEnterprisePartnerships@bis.gsi.gov.uk.