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Local Enterprise Partnerships: putting the enterprise into LEPs

Local Enterprise Partnerships: putting the enterprise into LEPs. UKSPA conference, Harwell Science & Innovation Campus 9 &10 February 2011 Chris Green, Chief Executive, SQW Group. Content of presentation. Why me? What are LEPs? What do they say their role is in relation to enterprise?

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Local Enterprise Partnerships: putting the enterprise into LEPs

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  1. Local Enterprise Partnerships: putting the enterprise into LEPs UKSPA conference, Harwell Science & Innovation Campus 9 &10 February 2011 Chris Green, Chief Executive, SQW Group

  2. Content of presentation • Why me? • What are LEPs? • What do they say their role is in relation to enterprise? • So how do we put the enterprise into LEPs?

  3. Why me? • SQW Group comprises: • SQW Ltd, a specialist economic development and regeneration provider of research, analysis and advice • Oxford Innovation, which runs business and innovation centres across UK, and innovation programmes focused on high growth businesses • SQW published research on LEPs which analysed the submissions to Government, and has since maintained as far as possible an overview of what is going on

  4. What are LEPs? • Abolition of RDAs announced in Budget 2010 • Ministers wrote to business leaders and local authority leaders on 29 June 2010 inviting them to jointly prepare outline proposals for Local Enterprise Partnerships (LEPs) • The letter stated that LEPs • are central to a vision of rebalancing the economy towards the private sector • will want to “create the right environment for business and growth” and set out “local economic priorities” • should “cover real functional economic and travel to work areas” • The letter said that some responsibilities would be retained at the centre, including innovation, access to finance and inward investment • The letter said nothing in relation to the resources on which LEPs might draw • Responses were required by 6 September 2010 – 69 days later

  5. Enterprise was “mid table” in relation to LEP themes it was identified as a local priority in 39 out of 50 LEPs 31 LEP submissions provided some indication of what they would do in relation to enterprise 9 submissions provided some rationale for intervention to support enterprise What do LEPs say their role is in relation to enterprise?

  6. Most submissions talked about “generating economic growth” in a general sense But genuine, hard, thinking about rebalancing was thin on the ground… And the geography of LEPs was very mixed Did LEP submissions respond to the Government’s stated priorities?

  7. Government approved 24 submissions in the first round (28 Oct) and another 4 since then – Black Country, North East, New Anglia (Norfolk & Suffolk), Worcestershire Still some notable gaps (e.g. Humberside, Lancashire) Some curious geographies - Hertfordshire Kent, Greater Essex & East Sussex The current situation (Source: Financial Times)

  8. Funding for LEPs • White Paper made it clear that no resources will be provided for LEPs… • …although they are eligible to bid into the Regional Growth Fund… • …but RGF is worth £1.4bn over 3 years… compared to an aggregate RDA budget of £2.2bn in 2009/10 • 450 bids submitted by deadline for first round RGF bids (21st January) for £250k-300k of funding • Most resources appear likely to go to Assisted Areas due to State Aid rules and Government intention to focus on “areas that have a preponderance of public sector employment, most of which are in the north”

  9. So how do we put the enterprise into LEPs? • With difficulty…… • Although there are other funding opportunities • Notably for Technology & Innovation Centres • And the property sector is waking up after the recession, and showing renewed interest in science parks and innovation centres • But the public sector will need to play a role in supporting enterprise and innovation, and it will need resources to do that – even if it is only seed funding, some stimulus is likely to be needed to get LEPs going

  10. Some specific suggestions • Government should incentivise/leverage re-use of premises for innovation centres and science parks – e.g. empty rates relief could be used to leverage such investment, but instead….. • Current change in empty rates legislation has damaged the sustainable performance of innovation centres. Maximum size is too small at Rateable Value of £2,600 – This is broadly a 2 person office at 90ft2/workstation • RDAs invested in innovation centres, science parks and other initiatives to support innovation. A successor body needs to pick this up and drive the innovation agenda using these assets as leverage

  11. Some more specific suggestions • Need to focus public funding more on innovation and enterprise services than the bricks and mortar of centres: to make the difference between a straightforward managed office and a genuine innovation centre • Many of the 31 LEP submissions that gave some information about what they would do to support enterprise referred to access to finance and business angels • Very few business angel networks survive without subsidy: those that do have a scale of operation which is larger than most LEP geographies • This suggests that if LEPs are to get involved in access to finance, they need to work together, not separately.

  12. Contact Chris Green Chief Executive SQW Group t. 01223 209400 e. cgreen@sqwgroup.com w. www.sqw.co.uk

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