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08/07/2019

MPs criticise lack of clarity in government’s £12bn Local Growth Fund

Words: Huw Morris
Funding / iStock-878953966

An influential committee of MPs has accused the government of a lack of transparency and accountability over its £12 billion investment in the Local Growth Fund.

Members of the Public Accounts Committee said the government has “no real understanding” of the fund, despite claiming that every £1 given to local enterprise partnerships (LEPs) generates £4.81 in benefits.

The MPs dismissed this claim as an “unsubstantiated estimate”.

The committee said that while the Ministry of Housing, Communities and Local Government receives quarterly performance data from LEPs, it did not use this to measure the impact of local growth funding nationally. The ministry has not measured what value for money LEPs have delivered so far, nor could it provide the committee with examples of private sector investment generated through their activities.

LEPs had also underspent their Local Growth Fund allocation by around £1.1 billion in the three years to the end of 2017-18. The MPs said this called into question their capacity to deliver the complex projects they maintained were critical to economic growth in their areas.

“The committee has previously raised concerns about the transparency and governance of LEPs and more action is needed to ensure they are held properly accountable for spending,” said committee chair Meg Hillier.

“LEPs are supposed to be an engine room of local economic growth but they have been dogged by a lack of local accountability and there is little evidence that they have levered in the promised private sector funds,” she added.

Image credit | iStock 

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