Local Enterprise Partnership takes shape – and it’s all power to the private sector

Article published: Wednesday, January 12th 2011

The new Greater Manchester Local Enterprise Partnership (LEP) is set to become operational on April 1 and alongside the Greater Manchester Combined Authority (GMCA), it will set the stall for governing the city region and its economy in the years ahead. According to Manchester City Council’s Deputy Chief Executive Steve Mycio, the LEP will institute a “more formal relationship” between local authorities and the private sector.

The LEP, which the Association of Greater Manchester Authorities (AGMA) successfully bid for late in 2010, will partially fill the vacuum left by the dissolution of the Northwest Development Agency (NWDA). The NWDA was one of nine Regional Development Authorities (RDAs) established by the Labour government to develop economic strategy, promote inward investment on a regional level and funnel central government funds into major public-private partnership projects.

Whereas the NWDA was a ‘business-led’ quango which operated on the regional level, its successor will work closely alongside the Association of Greater Manchester Council’s (AGMA) beefed-up successor GMCA. Its role in the future of the city region was the only item on the agenda today at the Economy, Employment and Skills Overview and Scrutiny Committee at Manchester Town Hall.

Answering councillors’ questions, Steve Mycio indicated that the Coalition’s aim for the private sector to play a “fuller part” in growth was at the heart of the LEP bid – and that this was absolutely in line with council strategy over recent years. He told councillors this next step would promote local private sector leaders from their previous “advisory role” in urban governance to becoming formalised “key partners.”

When the LEP’s recruitment process opens next week candidates are expected to be overwhelmingly private sector leaders and those who “can demonstrate a strong understanding of the business needs and requirements for growing Greater Manchester’s economic base.” At present a shadow board of the LEP is headed up by the omnipresent Chief Executive of the city council Sir Howard Bernstein, who is in effect the city region’s highest-placed and most powerful civil servant. In addition to co-leading the taskforce overseeing the transition away from NWDA Sir Howard will take up, in Mycio’s words, a “logical” and “accepted” leadership role in GMCA.

On a financial level the budget available to the LEP pales in comparison to that of its predecessor, and it already appears that the massive funding hole for local development left in the wake of NWDA will prove problematic for the city region’s leaders.

While NWDA had its own £1bn budget over three years for the region, the LEP will have to apply for money for specific projects from the new Regional Growth Fund, which only amounts to a national pot of £1.4bn over the next three years. Aside from this LEP will have to be funded through GMCA – which in turn will rely on contributions from the ten Greater Manchester authorities.

In response to questions tabled by Cllr Neil Swannick over how the LEP is to be financed without central government money, Mycio acknowledged that there is “no new money”, but said that the LEP is the “only game in town” with which to move forward.

Both AGMA’s bid and Mycio’s report to the committee revert to banal urban boosterism, designed to attract investors to Manchester. Cue the usual fanfare over the city region’s prospects in the ‘knowledge economy’, growth in science and technology, low carbon industries and tourism, while urban leaders’ commitment to tackling ‘worklessness’ and raising the skills base for businesses is firmly reasserted.

As a brochure for businesses this is all good and well. However, when challenged by Cllr Julie Reid on how the cuts are likely to affect education, especially in deprived areas, Mycio conceded there were “no easy answers” beyond attempting to target services more efficiently.

Moreover, Mycio admitted “the residents of Greater Manchester have not always benefited” equally from the region’s growth trajectory in recent years. As commented upon by Cllr Hugh Barrett, the recent history of private sector growth in the city region is hardly encouraging, with only around 23,000 jobs created in the past six years of which the vast majority were low pay, something which fails to inspire “much great confidence” for the future.

Overall the economic strategy to be channelled through the fledgling institution provides little hope for Greater Manchester residents, while appearing to implicitly accept the long march to ever-declining job security, stagnating wages and contraction of public services. At the same time as cuts to council budgets of up to 21 per cent across the city region are projected to cost 7,000 town hall workers their jobs over the next few years, it seems the Greater Manchester LEP is set to tighten the private sector’s grip over local governance.

Andy Lockhart

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Comments

1. surprise surprise! however surely the acknowledgement that Sir Howard is the ‘logical’ and ‘accepted’ boss of the new entity goes against all rules on recruitment for positions? even if the post is opened up for public application then the process would be prima facie prejudiced? if this organisation were a new school, hospital or any other public body there would be an outcry and accusations of nepotism if the chief exec was announced before the advert was even put in the MEN jobs section!

   Comment by Red Mick on January 18, 2011 at 1:14 pm

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