2011 look before you lep - pugalis

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Look before you LEP

Paper should be cited as:

Pugalis, L. (2011) 'Look before you LEP', Journal of Urban Regeneration and Renewal, 5

(1), 7-22.

Abstract

State-led restructuring of sub-national economic governance and regeneration has been

rapidly evolving over the past year or so across England. With several waves of cross-

boundary Local Enterprise Partnerships approved by the UK Government, it is opportune to

take stock of some of the more notable shifts. Building on a preliminary analytical mapping

of the rocky road from regionalism to sub-regional localism, the paper pays particular

attention to the politicised process underpinning the alliances, and crafting, development and

subsequent submission of LEP proposals, as well as the eventual assessment and state

sanctioning of LEP bids. Examining the process from a variety of perspectives, the paper

highlights unequal power relations and extracts a number of powerful policy considerations.

The paper propounds the argument that the rhetoric of permissive policy masks centralist

controlling tendencies and unwritten rules.

Keywords: Public-private partnerships, sub-national governance, regeneration, economic

policy, regional development, business engagement, leadership and local enterprise

partnerships

INTRODUCTION

Following the Conservative Party’s announcements to replace England’s Regional

Development Agencies (RDAs) outside of London with Local Enterprise Partnerships (LEPs)

in the run up to the May, 2010 General Election, which broadly correlated with Liberal

Democrat views, it was clear that, failing a Labour election victory, RDAs’ dominant

economic regeneration role would be living on borrowed time.1 Once David Cameron and

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Nick Clegg had shaken hands on a deal to form a UK Coalition Government, the axe quickly

fell on RDAs as their powers, funding and responsibilities were curtailed, well in advance of

legislation set to formally abolish them by April, 2012. Alongside this act of demolition was

the fledgling idea of sub-national economic reconstruction centred on business-led LEPs.

Recognising ‘the constitutional paradox of a permanent civil service that has no permanent

memory’ (p. 214),2 it is considered crucial to analyse the ideas, thoughts and motivations

directing policy change in order to capture lessons that would otherwise go unnoticed or

remain concealed. Building on a preliminary analytical mapping of the rocky road from

regionalism to sub-regional localism that theorised the transitional landscape,3 the present

paper pays particular attention to the politicised process underpinning the alliances, and

leading to the crafting, development and subsequent submission of LEP proposals, as well as

the eventual state assessment of LEP bids. Consequently there is merit in briefly recapping

and updating the core aspects of the Conservative-Liberal Democrat’s (Con-Lib’s) state-led

restructuring of sub-national economic governance and regeneration since Pugalis posed the

exploratory question: ‘where do we go from here?’.3

The spatial scales favoured for the attempted management and governance of

economic regeneration policy have ebbed and flowed since the identification of the so-called

‘regional problem’ in the 1930s.4 Theoretical developments, policy-driven research and

socio-economic shifts have all played a role, yet it is arguably political ideology that has

instigated some of the more radical scalar-contingent institutional shifts. Whilst ‘regions’

performed an important administrative role prior to the 1990s (e.g. as statistical units), the

Major-led Conservative Government standardised them by way of introducing Government

Offices for the English Regions (GOs) in 1994. Partly in response to the European Union’s

preference for the regional administration of funding, such as the European Regional

Development Fund (ERDF), GOs provided Whitehall departments with regional tentacles.

The promotion of regions as preferable units for the administration and integration of sub-

national policy continued under New Labour, including the launch of RDAs in 1999. 5

Possessing statutory powers for furthering the economic development of regions, their

responsibilities grew incrementally and they wielded significant influence over regeneration

schemes involving the public sector. Despite largely favourable ‘independent’ evaluations,

they came under political scrutiny from the Conservatives and Liberal Democrats prior to the

General Election. Whilst space does not permit a detailed analysis here, against a background

of economic recession RDAs were attacked and criticised on democratic grounds owing to

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their locally unaccountable private sector-led boards and bureaucratic grounds perceived to

produce an ‘additional layer’ at an inappropriate spatial scale, amongst other things.

Supposedly aligned with their localism philosophy, the Coalition Government invited

English localities to put forward proposals – backed by democratic and business leaders – for

the creation of LEPs. This was initially restricted to those areas of England outside of

London, but the Government subsequently extended its invitation to London after discussions

with its Mayor. By way of these invitations, the gauntlet had been laid down by the Coalition

for a respatialisation of neoliberal economic regeneration entities. Providing localities – that

were originally expected to be composed of two or more upper-tier authorities – with less

than 70 days to put together propositions on the back of a few paragraphs of guidance in the

form of broad ‘parameters’ contained in a letter of 29th June, 2010 by the Business Secretary

and Communities Secretary,6 Government refrained from publishing any policy-guidance

until after the state-set 6th September, 2010 deadline. It was not until 28th October, 2010

when the Coalition issued their eagerly anticipated Local Growth ‘White Paper’7 that the

Government’s policy on LEPs was revealed.5

The White Paper is intended to provide the overarching framework for how the Con-

Libs seek to rebalance the country’s spatial economy as part of achieving an economic

recovery. It sets out three priorities:

1. Shifting power to local communities and businesses – by establishing local

partnerships of business and civic leaders (i.e. LEPs)

2. Increasing confidence to invest – by creating the right conditions for growth and a

new incentives regime

3. Focused investment – by tackling barriers to growth that the market will not address

itself and supporting investment that will have a long term impact on growth

As part of this broad brush agenda, a range of measures, designed to provide incentives for

local authorities (LAs) to promote business growth, is outlined in principle.5 The White Paper

also provided details of the first tranche of approved LEPs (see Figure 1), the process for

dismantling the RDAs and set out high-level criteria for the Regional Growth Fund. The

latter is set to be the prime (and only major) economic regeneration funding pot over the next

three years. The £1.4 billion England-wide fund, administered (but not financially supported)

by Vince Cable’s Department for Business, Innovation and Skills (BIS), will, among its

tasks, be instrumental in providing ‘match-funding’ for accessing the ERDF, administered by

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Eric Pickles’ Department for Communities and Local Government (CLG).8 The latter is an

example of the recentralisation of policy-funding functions; previously ERDF had been

managed by the RDAs and GOs before them.

Figure 1: A map of the first wave of state sanctioned LEPs

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Taking a critical look at the framing, process and politics underpinning the Coalition’s

‘open call’ for LEPs and the concomitant territorial alliances informing LEP submissions, the

paper extracts a number of powerful lessons that can be learnt from this policy story still

being written. Examining the process from several different perspectives, including business,

academic, political and practitioner views, the paper highlights unequal power relations.

Following the methodological approach via policy ‘chatter’ advocated by Pugalis,3 which

helps capture the political nuances and practitioner deliberations in a fast-paced policy and at

times chaotic environment, the paper propounds the argument that the rhetoric of permissive

policy masks centralist controlling tendencies and unwritten rules. The state-led orchestrated

politicised process is recounted in the next section, which is followed by an overarching

analysis of the LEP proposals submitted to Government. The assessment process is then

examined, before concluding with some lessons to date. As with all state-led restructuring

exercises, the motivations, implementation and outcomes are contextually embedded and thus

spatially distinct. Yet, in the realm of globally connected local places and practices, some

insights specific to England are likely to resemble processes evolving across other places,

countries and continents. In this respect, findings will be of interest and appeal to a wider

international audience of scholars and policy analysts. However, direct and unsympathetic

‘fast’ policy transfer of lessons learnt is not advisable.

THE POLITICISED PROCESS

The dismantling of regions, including the abolition of RDAs, was a political act. Con-Lib

critiques of RDAs – revolving around unsuitable administrative geographies, unaccountable

creatures of central government and inefficient bureaucratic machinery – can be viewed as a

smokescreen for eradicating vestiges of the Blair-Brown Labour era (1997-2010).9 Perhaps

owing to their primary desire of drawing to a swift end Labour’s regional policy-

infrastructure, the Coalition’s localist policy rebuilding plan was less developed.10

As

Damian Waters, the Confederation of British Industry’s (CBI’s) regional director in the North

West, put it: ‘There is a danger that [the Government] are throwing out the baby with the bath

water’. More extreme views attest that there is a danger of throwing the bath out as well!

Lesser and greater remarks of concern were reiterated from different perspectival lenses (e.g.

LA officers, entrepreneurs and regeneration practitioners), forming a strong impression that

whilst the ‘old’ regionalist policy approach was imperfect, wholesale demolition and

reconstitution was unnecessary, and potentially counterproductive.3, 9

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Prior to the General Election the most comprehensive account of LEPs was contained

in a letter by Caroline Spelman and Ken Clarke.11

Claiming that the RDAs were a legacy of a

failed regional government experiment, in reference to the North East of England’s ‘no’ vote

for an Elected Regional Assembly, the Spelman-Clarke letter suggested reforms to the

existing regional system, rather than ‘scrap it’ entirely. The assertion was that such reform

would strengthen local economic development and urban regeneration priorities. In terms of

leadership, Spelman and Clarke were insistent that ‘a leading local business person will chair

each new partnership’ (p. 2). Proceeding the General Election result, the Cable-Pickles letter

was a little more flexible, indicating that they were ‘willing to consider variants’ such as an

elected mayor (p. 2).6 The reference to elected mayors was a nod in the direction of their

intent to legislate for these in the 12 ‘largest’ cities (as set out in the Localism Bill).12

Yet, the

two page letter by Cable and Pickles has been widely rebuked across different sectors and

interests. Enraged by contradictory views pertaining from different ministers, Richard

Lambert, director-general of the CBI, described the manner in which the Government went

about creating LEPs as a ‘shambles’.

The quiet conflict between Eric Pickles (Conservative) and Vince Cable (Liberal

Democrat), icons of the notable policy differences that have traditionally existed between

their respective departments, CLG and BIS, goes much of the way in explaining why the

policy on LEPs lacks strategic cohesion, has developed unevenly and been riddled with

inconsistencies. It is feasible that the internal wrangling between BIS and CLG officials,

reminiscent of ‘negotiations’ that stretched out the implementation of the Treasury’s13

‘Review of sub-national economic development and regeneration’ in 2007 under a Labour

Government, may have expended valuable time and space for more creative, strategic

thinking. Though, it should be noted that this trait is not limited to national policy

deliberation. It is a pervasive peculiarity that transcends political affiliations and spatial

scales. Considering the vagueness of the policy of compromise contained in the ‘Local

Growth White Paper’,5 the role and scope of LEPs is yet to be adequately clarified, despite 12

months passing since the circulation of the Cable-Pickles letter. Consequently, LEPs in

practice are subject to be drastically transformed over time and across space.

In a letter addressed to Vince Cable, dated 14th September, 2010, which was leaked

to the press, Mark Prisk, Business and Enterprise Minister, alerted the Business Secretary to

the ‘strong concerns of the business community’ regarding LEPs. Prisk cautioned that LEPs

could be a ‘failure in large parts of England’ should business become ‘detached’ from the

initiative. Prisk’s letter of concern was in direct response to the public criticisms from

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powerful business lobby groups, such as the CBI. Sir Digby Jones, the former boss of the

CBI, claimed that LEPs are ‘politically driven and managed’, confused in their objectives, too

small to operate strategically and already had a ‘local authority mentality’. Jones’

condemnation epitomised the mood of the business community who began to refer to LEPs as

‘toothless tigers’ destined to be ‘talking shops’ and ‘empty vessels’.

The process, to date, has been a maelstrom of conflicting ministerial pronouncements

lacking the substance of a considered policy-framework, let alone any evidence supporting

the advocacy for yet another round of reterritorialised institutional manoeuvring, that shows

no signs of abating. Even Cable acknowledged that the process had been ‘a little Maoist and

chaotic’. In parallel to the ministerial induced confusion, LAs and businesses were presented

with the unenviable task, and potentially poisoned chalice, of garnering ambitious LEP

proposals in a relatively short period of time (i.e. 10 weeks).

SUBMISSIONS

In July 2010 the consultancy CommunitySense launched a research project to investigate how

LAs intended to progress the development of LEPs.14

More than 50 senior regeneration

professionals participated, with survey findings, unsurprisingly, indicating that LAs want

LEPs to adopt a strong enterprise focus including supporting employment, skills and business

development. Responses revealed a pragmatic acceptance that most LEPs would be formed

from existing partnership arrangements and there was a widely held expectation that

brokering business involvement would be particularly challenging. The Government received

a total of 62 LEP proposals, including a few propositions for strategic (regional) forums

intended to operate alongside and in cooperation with LEPs, such as, the Yorkshire

Enterprise Partnership. Content analysis of the majority of these submissions, alongside

interviews and media reports validates the public sector practitioners’ initial views captured

in CommunitySense’s LA survey.

Focus and priorities

Whilst there was no government blueprint for LEPs, at least no blueprint that Cable and

Pickles could agree and issue publicly prior to the September deadline, their letter provided a

broad steer and hinted at some of the Coalition Government’s emergent thinking.3 As cross-

boundary entities, the letter stated that LEPs should produce a ‘clear vision’ for their area

setting out ‘local economic priorities’. Providing the ‘strategic leadership’ for their functional

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economic space, the letter stated that they will play a key role in delivering the Coalition’s

commitment to ‘rebalance the economy towards the private sector’. The Cable-Pickles letter

intends LEPs to tackle issues like planning and housing, local transport and infrastructure,

employment and enterprise, and tourism in some areas, as analysed in more detail

elsewhere,3, 10, 15

thereby, supporting the Government’s aspiration to create the ‘right

environment for business and growth’. Although ministers claim that the model for LEPs is

that there is no model, by effectively – at first – ruling out the role of LEPs in some activities

including inward investment, sector leadership, responsibility for business support,

innovation, and access to finance, the broad parameters had been set. As a result, the salient

feature of LEP bids have several key characteristics in common (see Figure 2). However,

beyond the commonalities – reflective of the Government’s broad parameters and existing

economic regeneration priorities – proposals ranged significantly. It was clear that some, for

example, had been prepared late in the process; lacking broad partner input, analytical rigour

and thoughtful priorities. Some bids amounted to less than a handful of pages of text, whereas

others exceed 200 pages, including maps, diagrams and detailed economic analysis. Several

propositions mentioned an intent to adopt ‘innovative’ financial instruments, although

elaboration was absent in most cases.

Figure 2: Common characteristics of LEP bids

Key themes Common characteristics Bid examples Role Many bids consider the principal role to be that of

strategic leadership

Terminology, such as ‘influencing’, ‘advocacy’,

‘support’ and ‘enabling’, was frequently

mentioned

The East Sussex Prosperity through

Growth proposal did not outline

decision-making powers, instead

preferring a more strategic advisory

role

Scope and

priorities

Most proposals tended to reflect the enterprise

brief set out in the Cable-Pickles letter, although

addressing locally specific priorities featured

prominently in many bids

Some proposals used the Government’s language

of ‘rebalancing the economy’ to frame their

priorities

The Newcastle and Gateshead bid

suggested the use of a spatial

development plan to guide and

prioritise the work of the LEP

Form The proposed form of LEPs tended to be either an

informal partnership arrangement, often supported

by a LA acting as accountable body, or an entity

with a legal personality, such as a company limited

by guarantee

The East Anglia bid was silent on the

form of its proposed LEP

Functions Beyond those functions identified by Cable and

Pickles, such as housing, planning and transport,

other functions including access to finance,

supporting business start-ups and developing a low

carbon economy were frequently identified in bids

Functions identified by Government to be

delivered nationally, particularly inward

investment, were considered crucial to the

Oxfordshire’s submission proposed

joint-working with the Homes and

Communities Agency in allocating

housing and regeneration funds

Gloucestershire, Swindon and

Wiltshire sought devolved

responsibility for inward investment

through their bid

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workings of LEPs in many cases

Private sector

support

Most propositions claimed to have private sector

backing with some utilising signatories as

‘evidence’

The Atlantic Gateway bid was a rare

example of being genuinely private

sector-led

Governance The majority of bids mirrored the Cable-Pickles

guidance by proposing a private sector chair and

equitable board representation across the public

and private sector

Many propositions were explicit about their

intention to secure further/higher education

representation at board level

Most bids were silent on the matter of voluntary,

community and third sector representation at board

level

A number of bids intend to employ Employment

and Skills Boards

The Solent proposition set out to make

use of an Employment and Skills

Board

Business

representation

Some bids had clearly thought of different

mechanisms and processes to engender broader

business engagement beyond those nominated to

comprise the board

Hampshire’s submission cited

engagement through online

mechanisms and a business forum

Geography Almost all submissions were composed of at least

two upper-tier authorities, with frequent claims of

territories matching ‘natural economic areas’

Greater Manchester made a strong case

on the grounds of functional economic

space

A single upper-tier bid was submitted

in Cumbria

Boundary

disputes

There were competing bids covering similar and/or

overlapping geographies

Numerous LAs were included in two or more LEP

submissions

Competing bids were received by

Government across Lancashire,

Pennine Lancashire and Flyde Coast

Cross-boundary

working

Many propositions recognised the need for

working across LEP boundaries, primarily with

immediate neighbours but also with LEPs across

other parts of the country with similar sectoral

strengths

Some LEP bids proposed confederated working

arrangements and others set out to work within a

regional framework

Adopting consistent language, each of

the LEP submissions from across the

North East proposed to work with a

regional forum – the North East

Economic Partnership

Existing

partnerships

It was common for LEP submissions to recognise

the need to build on existing partnerships, though

not necessarily mirror existing geographies,

although some LEP bids are remarkably similar to

sub-regional governance entities established under

the previous Labour Government

Many of the City Regions and Multi-

Area Agreements, such as Leeds City

Region, put forward LEP bids

Governmental

relations

Several propositions were explicit about the need

to work closely with specific government

departments and agencies

The Birmingham and Solihull

proposition specifically mentioned its

intent to work closely with UK Trade

and Industry

Staffing

arrangements

Due to budget constraints and uncertainty of

funding most submissions outlined an expectation

that secretariat support would be kept to a

minimum

The Tees Valley submission identified

a core team of staff that would provide

policy and delivery support, and seek

to access additional funding

Funding and

other sources of

finance

Consistent calls for accessing the Regional Growth

Fund

Several bids suggested that they would consider

pooling public sector resources and there was

significant interest in place-based budgeting

Liverpool City Region’s submission

called for financial benefits where their

role in achieving welfare benefit

savings could be demonstrated

Assets Consistent calls were made through LEP bids for

taking on the ownership of RDA physical assets,

such as land and property

The Marches proposition sets out to

deliver ambition on the back of RDA

assets

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The majority of submissions identified workforce skills and inward investment as key

local priorities and therefore expected the LEP to play a decisive role.16

Yet, the Coalition

intends to recentralise these functions. Overall, an analysis of the LEP proposals shows a

clear trend towards LEPs performing a strategic enabling and influencing role – ‘steering and

cheering’. Locally distinct, specific details of the role to be performed by LEPs tended to be

sketchy in the propositions, which is understandable when considering the adventurous

timescales, lack of clarity from Government and no sign of state financial backing. It is clear

that some localities decided to design-in flexibility, with interview responses suggesting that

many LEPs intend to adapt once the landscape of LEPs becomes clearer. More than one

respondent made reference to waiting to see ‘which way the wind is blowing’ before

specifying functions and activities. Another practitioner involved in the crafting of a LEP

submission maintained that it was for ‘the board itself to determine priorities and activities ...

we [officers and representatives] can provide them with something to work with, but [the

board] need to have an input and make the final decision’. This type of stance indicates that

some proposals, perhaps even a significant majority, should be viewed as provisional works-

in-progress. Hence, it is likely to transpire that the actual focus and prioritisation of actions

over coming months and years may bear little resemblance to original bids. Indeed, the

announcement to revive Enterprise Zones (EZs), a favoured Conservative policy of the 1980s

and 1990s, with the 2011 Budget Report identifying the first 11 of 21 EZs across England,17

but only available to those places with a LEP, has prompted some commentators to claim that

‘New life has [been] breathed into LEPs’.18

Developing existing partnerships – LEPs are nothing new

In part owing to the compressed timescale for developing LEP submissions, but also

reflective of the array of neoliberal spatial governance arrangements developed over the

preceding decade – including but not limited to Multi-Area Agreements, City Regions and

Sub-Regional Partnerships – there was a strong propensity for LEP submissions to recast

existing arrangements. Indeed, the CommunitySense survey reported that ‘Over 87% of

Local Authorities sampled were preparing to utilise and merge existing partnership structures

to support LEP development’ (p. 7).14

Some of the most notable examples of LEP

submissions taking forward prior partnership configurations are the two pilot statutory City

Regions, announced in the 2009 Budget, covering Greater Manchester and the urban

conurbation centred on Leeds. Adopting such tactics prevents ‘reinventing the wheel’, which

is to be commended. These recast or simply rebadged partnerships will have accumulated a

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unique history of cooperation that any new partnership clearly has to negotiate. In this sense

established cross-boundary entities, such as Tees Valley Unlimited, may be at a distinct

advantage, as notwithstanding their own politico-institutional problems, they are

commencing life as a LEP with a track-record of economic governance at the larger than

local level. However, there is an apparent risk that some (predominantly public sector) actors

see LEPs as ‘business as usual’. In contrast, Dickinson asserts that the private sector ‘wants a

radical change’ in modes of working.16

Partly in response, terms such as, ‘fleet of foot’ have

entered the practitioners’ vocabulary to describe a new way of working that is more agile and

responsive than recent practice. Yet, so far, there has been little sign of a substantive cultural

shift to indicate that this will be the case other than in the most exceptional of circumstances.

It would be invidious if this latest round of state-led restructuring does not rouse more

innovative partnership arrangements and more creative ways of solving longstanding

economic issues.

Business involvement

Since the Coalition came to power, and especially in the period up to the September, 2010

LEP submission deadline, there has been a spate of policy announcements. Consequently, an

overwhelming weight of material was being fired in all directions and it was difficult for the

private sector to engage within such a small window of opportunity. A survey of almost 300

businesses by Shropshire Chamber of Commerce conducted prior to government deadline

revealed that approximately two-thirds of respondents were aware of the abolition of RDAs,

but there was less clarity on the role and governance of LEPs.19

For example, 37 percent of

respondents had no knowledge that LEPs are intended to be business-led with strong board

representation. Notwithstanding some promising exceptions and creative ways of engaging

businesses, such as through online networks, it is little wonder that the role of business in the

crafting, formulation and endorsement of submissions has been variously described as ‘thin’20

and ‘patchy’.21

As a result – implicitly and explicitly – the process can be characterised as

being LA-led, despite the Cable-Pickles letter calling for business leadership. The following

quote from a researcher at the Centre for Cities think-tank demonstrates the assumption that

LAs are the driving force behind the development of LEP submissions:

‘Partnerships will need to consider carefully who to involve from the business community,

and how to work with them to ensure a laser focus on growing local economies. The

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Partnership for Urban South Hampshire, for example, only engages with business on key

strategic issues, to make best use of their time’.21

There is an implicit inference that ‘partnerships’ are run by public sector stakeholders who

have more time to devote, with businesses only consulted ‘on key strategic issues’. If such a

view informs the workings of LEPs then the business as usual model will surely prevail. The

‘involvement’ of business interests in sub-national economic governance is an area that is

worthy of additional theoretical and empirical enquiry. It is far too simplistic to view private

sector or even more holistic multi-sector leadership as a magic bullet for the many complex

and entrenched issues that LEPs will inevitably face in the future.

In a context of economic austerity, some commentators are concerned that LEPs will struggle

to compensate for the ‘regional lacuna’ that has emerged following the demise of the RDAs.9

Drawing on the case of the North-West RDA, Kevin Meagher argued that the BBC would

never have moved to Salford Quays without a strategic regional body in place ‘to bang heads

together and get a rational approach agreed’ between Manchester and Salford councils.22

Calling for LEPs to have genuine powers that can help generate business interest, Meagher

opined that ‘the last thing anyone needs are a fleet of empty vessels manned by squabbling

local authorities as the big picture on regional economic development gets missed’. Yet,

prospective LEPs submitted their proposals lacking clarity on what they were permitted to do,

how they will do it, and how and by whom they will be judged.

RED, AMBER, GREEN: PERMISSIVE POLICY OR UNWRITTEN RULES?

As a consequence of the Government’s embryonic policy for LEPs, there was broad concern

from business groups and think-tanks that there could be ‘far too many little ones - which

would undermine their effectiveness’.23

Yet, a high number of bids was always likely to be a

by-product of localism, particularly if one agreed with the Coalition’s view that the eight

RDAs (excluding London) were too remote from local economic ‘realities’. A permissive

approach, what CLG’s deputy director of economic partnerships defines as ‘no prescription,

no guidance, no duties, with accountability [instead resting with] local people, and an end to

mindless reporting/strategies and plans produced to satisfy Government’s appetitive for more

and more data and information’,24

would therefore place an onus on the multiple stakeholders

within localities negotiating translocal economic forces. Here, local actors decide what the

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issues are, how to tackle them, who to work with and how to work – the What, Who and How

formula. Such a ‘bottom-up’ approach may not necessarily correlate with the views of

Whitehall, but it would demonstrate a first step of localism in action.

Emanating from the loose guidance provided by Government was the added

confusion derived from stakeholder interpretations. Creating ‘space’ for LEPs to respond to

local needs and priorities, which is welcome, Johnson and Schmuecker warned that this ‘also

creates uncertainty as to what will meet the criteria and what will not’ (p. 1).25

Whilst there

were generalities across the submissions, as identified above, there were also spatially

specific priorities and tailored ‘solutions’. The process, therefore, increased the likelihood of

competing bids and overlapping geographies. The Government subsequently received more

than 60 individual LEP proposals, which was decidedly more than BIS had hoped for, but

probably more closely attuned with the localism policy of CLG and its ministerial head Eric

Pickles. Pugalis3 demonstrates this patchwork quilt of prospective LEP geographies visually

and SQW20

quantified that at least 70 district authorities were included in two or more

submissions. Figure 3 identifies many of the geographically overlapping bids.

Figure 3: Competing LEP bids

Region Areas with competing bids North East None

Yorkshire and

Humber

York and North Yorkshire and Leeds City Region

York and North Yorkshire and Hull, East Riding and Scarborough

Hull, East Riding and Scarborough and Humber

Leeds City Region and Sheffield City Region

North West Liverpool City Region, Greater Manchester, Cheshire and Warrington and the

Atlantic Gateway

Lancashire, Pennine Lancashire and Flyde Coast

East Midlands South East Midlands and Northamptonshire

West Midlands Birmingham and Solihull with East Staffordshire, Lichfield and Tamworth and

Stoke on Trent in Staffordshire

East of England East Anglia and Norfolk

East Anglia and Greater Cambridge and Greater Peterborough

East Anglia and Kent-Essex

South East Kent-Essex and Kent and Medway

The M3 corridor and Surrey

The Solent and Hampshire and the M3 Corridor

Surrey and the Coast to Capital and the Gatwick Diamond

Gatwick Diamond and Coast to Capital

South West Cornwall and Isles of Scilly and Devon and Somerset/Heart of the South West

Devon and Somerset/Heart of the South West and South Somerset and East Devon

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With Government lacking substantive criteria with which to base their decisions, a

straightforward, objective and transparent assessment process of LEP submissions appeared

improbable. The Coalition had inadvertently set themselves an impossible challenge: how to

demonstrate commitment to their permissive approach and localist philosophy at the same

time as encouraging localities to overcome territorial disputes and rise above parochialism.

How the Coalition responded proved to be a significant early test in respect of their ‘appetite

for the reality as well as the rhetoric of devolution’.21

At this crucial stage, ministers were

forced to reveal their hand which confirmed that the ‘Whitehall knows best’ view had not

vanished, but had been masquerading through the concept of localism. The Government

opted to endorse an initial wave of 24 LEPs using ex-post rationalisation as a way out of the

trap they had inadvertently created (see Figure 1). Finding themselves in an unexpected

situation that tested their localist credentials, the Coalition, so as not to appear irrational,

modified their approach (philosophy) so as to ‘justify’ their course of action. Ex-post

rationalisation permits actors, in this case government ministers, to reformulate past actions

and processes to appear in a more positive light. The specific course utilised by the Coalition

Government involved the adoption of four key criteria to assess the LEP proposals: i) support

from business ii) natural economic geography iii) LA support iv) and added value and

ambition.7 Without explaining the use of such criteria or indeed acknowledging the existence

of such criteria prior to and/or during the open invitation for LEP submissions, it is doubtful

the extent to which this criteria informed the ministerial decision-making process. Whilst the

Coalition have been staunch advocates of transparency, with Pickles contending that Freedom

of Information requests would be rendered redundant if the public sector made more

information readily available, they have been far from transparent in the murky LEP approval

process. Indeed, politicised motives masquerading as rational policy decisions may also be

directing the location of EZs. In April, 2011 David Cameron reportedly stated that the Stoke-

on-Trent and Staffordshire LEP area would be granted one of the remaining ten EZs, pre-

empting what has been officially scripted as a competitive bidding process.

Decision letters to proposers support the view that ministers arbitrarily adopted a

traffic light system of assessing bids. ‘Red’ – limited chance of approval and a major rethink

required. ‘Amber’ – additional work need, largely in terms of geography or partner buy-in.

‘Green’ – approval granted. Around 90 percent of the content of decision letters to proposers

consisted of generic text, which provided the impression that individual bids had not been

systematically considered. The intention to provide ‘detailed and individual feedback to

partnerships’24

may have been laudable but was never realistic considering that the London-

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based civil servants in BIS and CLG were only ever resourced to liaise with nine RDAs, and

were themselves facing staff reductions as a result of the spending cuts announced in the

October, 2010 Comprehensive Spending Review.26

Figure 4: A map of 33 LEPs – April, 2011

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The first tranche of LEPs left approximately 40 per cent of the population of England

LEP-less, with significant left-over spaces occupying large swathes of the North East, North

Yorkshire, Lancashire, Humberside, East Anglia and the West Country. Since the initial

wave, three more were approved in December, 2010 and by the end of April, 2011 six more

had been approved on an incremental basis, which brought the number of state sanctioned

bids to 33 (covering approximately 93 per cent of England’s population and 1.9 million

businesses) (see Figure 4).

LESSONS TO DATE

In a rapidly evolving policy environment, change is the only constant at the moment.

Although it is too early to judge the efficacy of LEPs, marked differences in the LEP

submissions and, just as importantly, their process of production, can be identified in order to

extract some key points of learning from the process to date. Whilst it would appear obvious

that LEPs should have clarity of purpose, including strategies, funding and powers,27

the

compressed timescale and lack of guidance mean that in many cases this remains a crucial

aspect to resolve. Without this basic understanding of their raison d’être and the tools at their

disposal, LEPs face an uphill struggle to influence the regeneration and growth of local

economies (especially over the short-term). Therefore, the first lesson to be drawn from

England’s state-led restructuring of sub-national economic governance and regeneration is

that clarity of goals and objectives, in this case to enable local growth, should be thoughtful

and achievable. Whilst locally tailored priorities and approaches are advocated, visions

lacking the substance to deliver will be futile. Lesson two is for the rules of the game to be

explicit and agreed upfront. It is for this reason that new policy concepts, such as LEPs, are

normally consulted upon prior to policy formulation and implementation. Linked to this,

lesson three is to learn from what has gone before: salvaging what has worked, revising what

could work better and learning from what has not worked so well. It is perhaps this lesson

which the Coalition Government should heed most in the future. Lesson four is to be realistic

about what can be achieved within compressed timescales. For example, seeking views and

proposals for new ways of working between public, private and voluntary sector interests

within a 10 week period was overambitious. The fifth lesson is that old rivalries, territorial

disputes, local politics and histories of stakeholder relations die hard. A perceived peril of

some of the submissions and state sanctioned LEPs is that the cavernous cracks created by

longstanding tensions may have only been papered over rather than fundamentally addressed.

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As the results of May, 2011 local government elections have transformed the political

dynamics of some areas, it will be interesting to monitor whether this unsettles or stabilises

emergent LEP relations. Those LEP-less areas, such as north and south of the Humber, may

use changes in local political leadership as an opportunity to put in place some cross-

boundary arrangements. The sixth lesson is to acknowledge that the form and focus of LEPs

will be spatially and historically contingent and, therefore, each LEP will require variable

degrees of national support and autonomy. The seventh lesson is to recognise the unequal

power relations of partnerships and to negotiate these in an open and transparent manner. The

Coalition exercise considerable power across the landscape of LEPs, yet arguably, these

powers have been concealed by representations of localism.

The ground rules for LEPs and sub-national economic regeneration has shifted rapidly

over the past 12 months. In part, this can be attributed to the frenetic politicised process that

framed the alliances, crafting, development and subsequent submission of LEP proposals, as

well as the eventual assessment and state sanctioning of LEP bids. Commencing with only a

nebulous notion of what form a LEP may take and what they could achieve, some

commentators perceived this to be evidence of ‘localism in action’ – a truly permissive

approach from Whitehall. Other analysts point to the tension between the localism of Pickles

and the regionalism-centralism of Cable, and indeed their respective officials, as the primary

reason underscoring a lack of guidance. As a result, the proposed LEP geographies were

unlikely to tessellate. Given the permissive rhetoric of the Con-Libs, their criteria for

assessing bids would prove challenging and contentious.

The paper has identified a lack of transparency, shifts in politico-policy direction and

ex-post rationalised criteria, leaving a dark cloud over the deliberations informing the crude

traffic light system of endorsing some (Green), leaving the door open for others (Amber) and

the bold rejection of the rest (Red). Despite expressions of localism wrapped-up in a

demagogical strategy, after 12 months of Con-Lib rule the shift from RDAs to LEPs appears

to mask insidious centralism. If this is so, then the Coalition’s sub-national policy is

remarkably similar to Labour’s. Further, LEPs could be considered more of a reaction against

Labour’s RDAs rather than a direct replacement. Though the Labour Government

propounded the virtues of subsidiarity,13

they were reluctant to grant localities genuine

economic powers, financial levers or incentives beyond a duty to assess the condition of their

economy. At a time when many areas have an improved understanding of economic

opportunities and regeneration priorities, in part supported by the production of Local

Economic Assessments, it is hoped that the tendency for Whitehall to centralise power and

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resources, which concomitantly undermines the representative role of local government, will

be reversed by way of LEPs. Such a shift would go some way in addressing the state-local

power imbalances and truly differentiate the Coalition’s espoused ‘radicalism’ from what

went before.

Speaking at the London Development Agency’s annual public meeting on 9th

November, 2010, London Mayor, Boris Johnson, believed it would be a ‘mistake’ to create a

network of LEPs within the capital

‘My motto is look before you LEP. What we need to do is be very careful that we don’t

reinvent the wheel. I think it would be a mistake for London to create a confusing and

complicated Venn diagram of sub-regions … I don’t think that’s the way to go’.

It has subsequently transpired that the Mayor’s advice has been heeded, with a single LEP

created for the capital (which in many respects is a direct replacement of the London

Development Agency but with much less financial muscle). Yet, even in London the LEP

picture is not totally clear.28

As the boundaries of England’s sub-national economic

governance and regeneration landscape continue to be redrawn geographically, politically,

institutionally, and across sectoral interests and stakeholders, many questions originally posed

by Pugalis3 remain pertinent but are yet to be answered at this stage. The importance of

collaboration, governance, powers, responsibilities and resources will be crucial to the

efficacy of LEPs and worthy of more detailed investigation in the future.

The spatial injustices of a fractured society of the privileged and dispossessed could

potentially be exacerbated by LEPs, assuming that some will be more powerful and effective

than others or if some localities remain LEP-less in the post-regional landscape. Policies

focussing on enabling the market and responding to opportunities tend to have an unpleasant

track record of silencing marginal communities and actors, whilst benefiting more powerful

interests who tend to shout loudest.2 Considering that geographically rebalancing the

economy is purported to be a major strand of the Coalition’s growth strategy, such a situation

warrants serious political and analytical attention. Perhaps the Con-Libs and others should

have followed the advice of Boris Johnson and ‘looked before they LEPed’.

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REFERENCES AND NOTES

1. Due to its unique constitutional arrangements a separate process operated in London,

where the Mayor and London boroughs were invited to come forward with LEP proposals by

5 November, 2010, which was subsequently extended.

2. Houghton, J.H., and Blume, T. (2011), 'Poverty, power and policy dilemmas: Lessons

from the community empowerment programme in England'. Journal of Urban Regeneration

and Renewal Vol. 4, No. 3, pp. 207-217.

3. Pugalis, L. (2011), 'Sub-national economic development: where do we go from here?'.

Journal of Urban Regeneration and Renewal Vol. 4, No. 3, pp. 255-268.

4. Gudgin, G. (1995), 'Regional problems and policy in the UK'. Oxford Review of

Economic Policy Vol. 11, No. 2, pp. 18-63.

5. Pugalis, L., and Townsend, A.R. (2011), 'Rebalancing England: Sub-National

Development (Once Again) at the Crossroads'. Urban Research & Practice Vol. In Press.

6. Cable, V., and Pickles, E. (2010), 'Local enterprise partnerships'. Open letter to Local

Authority Leaders and Business Leaders, HM Government, London.

7. HM Government (2010), 'Local growth: realising every place’s potential'. The

Stationery Office, London.

8. The Regional Growth Fund is expected to provide £580 million capital and £840

million resource funding over the ensuing three years. Open to all parts of England, financial

support is made up of contributions from CLG, the Department for Transport and the

Department for Environment, Food and Rural Affairs. CLG is the largest contributor,

providing £890 million. The budget allocation for for 2011-12 is £495 million.

9. Pugalis, L. (2011), 'The regional lacuna: a preliminary map of the transition from

Regional Development Agencies to Local Economic Partnerships'. Regions Vol. 281, No.,

pp. 6-9.

10. Pugalis, L. (2010), 'Looking Back in Order to Move Forward: The Politics of

Evolving Sub-National Economic Policy Architecture'. Local Economy Vol. 25, No. 5-6, pp.

397-405.

11. Spelman, C., and Clarke, K. (2010), 'Strengthening local economies'. Open letter to

Conservative MPs, House of Commons, London, pp. 1-4.

12. Communities and Local Government (CLG) (2010), 'Decentralisation and the

Localism Bill: an essential guide'. The Stationery Office, London.

13. HM Treasury (2007), 'Review of sub-national economic development and

regeneration'. HMSO, London.

14. CommunitySense (2010), 'LEPs: the story so far, A survey of 51 Local Authorities by

CommunitySense (Part 1)'. CommunitySense, London.

15. Bentley, G., et al. (2010), 'From RDAs to LEPs: A New Localism? Case Examples of

West Midlands and Yorkshire'. Local Economy Vol. 25, No. 7, pp. 535-557.

16. Dickinson, S. (2011), 'LEPs: puzzle or journey?'. In Local Enterprise Partnerships:

Good Neighbours - Good Outcomes, Evolution Business Centre, Northallerton.

17. HM Treasury (2011), 'Budget 2011'. Stationery Office, London.

18. Jones, A. (2011), 'Zones give teeth to partnerships'. Planning, 21 April, pp. 16-17.

19. Shropshire Chamber of Commerce (2010), 'LEP Survey'. Shropshire Chamber of

Commerce, Shropshire and Telford & Wrekin.

20. SQW (2010), 'Local Enterprise Partnerships: A new era begins?'. SQW, London.

21. Maugham, C. (2010), 'What will life be like after RDAs?'. Public Servant, 11

October.

22. Meagher, K. (2010), 'Opinion: Talk of RDA 'abolition' is premature'. Regeneration &

Renewal, 6 July.

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23. Finch, D. (2010), 'Most LEP proposals not good enough - Cable'. Vol. Available at:

http://fishburn-hedges.typepad.com/dermot_finch/2010/09/cable-wrigglesworth-lukewarm-

on-leps.html [Accessed on 22 October 2010].

24. Francis, C. (2010), 'Local Enterprise Partnerships: The story so far and relationship

with planning', National Planning Forum, 8 October.

25. Johnson, M., and Schmuecker, K. (2010), 'Four Tests for Local Enterprise

Partnerships'. IPPR North, Newcastle.

26. HM Treasury (2010), 'Spending Review 2010'. The Stationery Office, London.

27. Lee, N., et al. (2010), 'No City Left Behind? The geography of the recovery - and the

implications for the coalition'. The Work Foundation, London.

28. Alongside a London Enterprise Partnership, covering the whole of the capital, the

North London Strategic Alliance (NLSA), representing business interests, public sector

bodies and eight councils, as of March, 2011, was intending to press ahead with their

London-Anglia LEP approach, which was rejected by Government. Despite no formal LEP

recognition, the NLSA contend that London’s economy is so diverse that a single LEP will

not adequately tackle its barriers to growth.

http://fishburn-hedges.typepad.com/dermot_finch/2010/09/cable-wrigglesworth-lukewarm-on-leps.html

http://fishburn-hedges.typepad.com/dermot_finch/2010/09/cable-wrigglesworth-lukewarm-on-leps.html

2011 look before you lep - pugalis

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