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Just whose hands are on the LEP and its Single Pot?

Just whose hands are on the LEP and its Single Pot?

🕔18.Mar 2013

hezzaSince the rest of Chamberlain Files’ top team (Marc Reeves and Kevin Johnson) have had their say, here’s my take on the rise and rise of the Greater Birmingham LEP:

Michael Heseltine, the arch-interventionist, who must by now be thinking all of his Christmases have come at once, posed a simple question when he took control of the Greater Birmingham Project: “Who is in charge?”

Lord Heseltine recognised there would have to be a clear and accountable chain of command if Whitehall was to be persuaded of the case for transferring billions of pounds of Government cash to enable Local Enterprise Partnerships to stimulate regional economies.

The initial attraction of LEPs for the Government was that these organisations would be lean and mean, with boards consisting of a majority of local business leaders. LEPs were not to be controlled by local councils, and most definitely were not to turn into new versions of the plodding, bureaucracy laden regional development agencies.

There was never much doubt that the Chancellor would accept most of the findings in Lord Heseltine’s No Stone Unturned report and that, as a result, a large sum of single pot money will soon be winging its way to the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) to be spent on a variety of much-needed job creation projects including development of the M42 Corridor and Birmingham Airport.

Whether this money can actually generate wealth by bucking the market and makes any more difference than previous Government initiatives remains to be seen, but let’s not go there at this stage.

The question that is being asked, particularly in Labour Party circles, is: “Who runs the LEP?” It’s an important question since initial estimates of the amount of total cash GBSLEP may get its hands on is about £7 billion.

Former Birmingham MP and mayoral campaigner Sion Simon put like this on Twitter: “The @gbslep‘s plan’s huge weakness, though, is ‘Who’s in Charge’. It’s the fault of the Government, not the LEP, but the answer’s still no one.”

John Clancy, who is expected to challenge Sir Albert Bore for the Birmingham City Council leadership, has taken to describing the LEP as “the Tory LEP”, since a majority of its council members are Conservatives and it is, apparently, a Government creation.

This week’s report from the Greater Birmingham Project outlining how a Single Pot might benefit the West Midlands has quite a lot to say about “clear political accountability”. Unfortunately, the words don’t quite spell out who actually is going to run the LEP.

A Supervisory Board consisting of the LEP’s nine council leaders – Birmingham, Solihull, Bromsgrove, Redditch, Wyre Forest, Cannock Chase, East Staffordshire, Lichfield and Tamworth – will be established to “provide clear political accountability for the management of the Single Pot”, according to Lord Heseltine.

The supervisory board will, presumably, be chaired by Sir Albert Bore.

In the report, Lord Heseltine attempts to suggest that the supervisory board will not “challenge or replace” the private sector-led GBSLEP board: “The Supervisory Board will empower the GBSLEP Board through formal decision-making powers and a scheme of delegated authority.

“This means that the private sector-led board, backed up by the democratic accountability vested in the nine elected leaders, will have the clear authority to make the decisions and write the cheques that will drive local growth in the GBS area.

“This will streamline and make more effective the implementation of the Local Growth Strategy.”

So, is it the case that all of the important decisions will have to be taken first by the council leaders and then delegated down the line to the LEP board? And how on earth does the proposed structure reflect Lord Heseltine’s claim that the LEP board will not be “challenged or replaced” by the supervisory board?

It must be assumed that each of the nine supervisory board members will have an equal say in voting, thereby putting the members for tiny Wyre Forest and Cannock Chase on a par with mighty Birmingham and slightly less mighty Solihull. This, then, returns to Cllr Clancy’s criticism about a “Tory LEP” with a political hold over Birmingham.

And don’t even think about how the LEP decision making process filters down to backbench councillors on the nine local authorities, or how the tantalising possibility of a regionally elected mayor might fit into all of this.

There’s more. It’s proposed to recruit a chief executive to oversee the GBSLEP board, or “strengthen” it as the report puts it. The CEO is likely to be the chief executive or senior manager from one of the LEP’s constituent councils.

So it immediately becomes clear that the original job description for the LEP is to be taken up several notches, with the organisation blending seamlessly into the local government landscape.

The Greater Birmingham Project gives some more details about how these arrangements will work in practice: “Once the details of the Single Pot are announced we will immediately establish a

Supervisory Board, comprised of the nine elected local authority leaders. This will provide clear political accountability for the management of the Single Pot. It will operate a cabinet style of accountability and will be a formal governance structure between a Joint Committeeand a Combined Authority.

“The Supervisory Board will empower the GBSLEP Board through formal decision making and a scheme of delegated authority and so will further strengthen the partnership between business and civic leadership.”

Somehow I get the feeling that a remote monster is being born. It would be disastrous if local government structures were to strangle entreprenurialism.

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