Heseltine warns of funding battle

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Lord Heseltine has warned of a “battle” in the corridors of Whitehall over the amount of public money due to be handed to local areas under his radical programme for regional growth.

Speaking at a conference of local enterprise partnership (LEP) bosses in London, the Tory peer said Government departments are desperately fighting to “protect their interests” and hang on to tens of billions of pounds of public funds which he wants local areas to be able to spend for themselves.

Lord Heseltine produced a landmark report for the Treasury last year focused on how to spark economic revival in the regions.

Its centrepiece was the creation of a £70 billion ‘mega-fund’ of existing Whitehall money, currently being spent on ‘growth’ schemes such as housing, infrastructure, skills training and apprenticeships.

The peer wants LEPs to be able to spend the money from this so-called ‘single pot’ of funds for themselves, to deliver grassroots projects across their local area.

“The word transformational is used all too often in government,” he said. “I believe the single pot has the potential to be just that.

“It is a huge opportunity to drive your local economy; to show that public-private partnership is more than a slogan.”

The Yorkshire Post is calling for the Government to implement Lord Heseltine’s reforms as swiftly as possible, as part of its Give us a Fair Deal campaign.

The Chancellor, George Osborne, has said he accepts the key recommendations and will set out detailed plans in his next spending review in June.

But the Treasury has refused to be drawn on precisely how much money is going to be made available for LEPs to bid for.

Sources have suggested the final total could be a fraction of the amount envisaged by Lord Heseltine.

The Tory peer said he accepts the battle has not yet been won, and that people are “rightly” asking whether Government will really deliver.

“They have said they accept my proposals,” he said. “That is about 25 per cent success. The prize is in the delivery.

“I am encouraged by the language of their reply, but I have been in politics long enough to know that change is never as easy as one would hope.

“You need a pot that is of a scale to warrant the effort.”

Lord Heseltine said now was the time for business leaders and politicians to speak up for their local areas, ahead of the crucial announcement in June.

“There is an inevitable battle going on in Whitehall,” he said. “Some who want (the pot) bigger, some who want it smaller. There are those who are trying to protect their own interests.

“So you must marshal your forces, lobby your MPs, get your MPs to lobby Ministers, and use the media to drive your campaign.”

Speaking after the conference, York Council leader James Alexander, who is vice-chairman of the Leeds City Region LEP leaders’ board, said local leaders are “up for the challenge” and called on Ministers to prove their stated commitment to devolution is not a mere “sham.”

“Lord Heseltine’s growth plan is radical because nobody before has done the things that need to be done,” Coun Alexander said.

“He challenged us to say whether we are up for it ,and in the Leeds City Region we are.

“Where his plan falls short is he believes in genuine devolution and localism, as I and many of my colleagues do, but the Government - whether that be the Ministers or the civil service are more cautious at cutting the apron strings. Devolution is slow, and sometimes a sham.

“Lord Heseltine said growth is local and he is right. If the Government wants economic growth it is up to local businesses and councils working together to be the delivery arm of that agenda.

“In the Leeds City Region we can do it - we just need the tools, and we are demanding the tools, to get the job done.”

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