Fiona Bruce – 2014 Parliamentary Question to the Department for Communities and Local Government

The below Parliamentary question was asked by Fiona Bruce on 2013-06-25.

To ask the Secretary of State for Communities and Local Government, what powers and freedoms relating to (a) skills and employment, (b) housing and (c) economic development have been devolved since May 2010 to (i) local government and (ii) local enterprise partnerships.

Kris Hopkins

[Holding Reply: Monday 1 July 2013]

The Government is taking considerable steps to devolve power and freedom to local government and Local Enterprise Partnerships.

Through the Localism Act, councils now have the general power of competence that enables them to do anything that an individual might do, apart from that which is specifically prohibited. In addition we have radically reformed the local government finance system putting levers and incentives in the hands of local authorities, for instance:

· The removal of ring-fencing from local government grants has given councils the freedom and flexibility over the money they receive and allows them to work with their residents to decide how best to make their spending decisions to fit their local priority needs.

· rewarded places that deliver growth, through the New Homes Bonus and Business Rate Retention.

· Local authorities now directly retain 50% of business rates locally which amounts to nearly £11 billion, instead of returning it to Whitehall.

· We established five pilot Rural Growth Networks aimed at tackling the barriers to economic growth in rural areas, such as a shortage of work premises, slow internet connectivity and fragmented business networks. These pilots expect to create up to 3,000 new jobs and support up to 700 new businesses, offering a local approach to local problems. We will share the lessons they learn with other Local Enterprise Partnerships and Local Authorities to help them promote growth in other rural areas.

We have also given councils the ability to borrow against their Housing Revenue Account.

Through the city deals programme we have devolved powers and responsibilities to 26 cities. For example we have:

•provided levers to deliver the skills and jobs that local businesses and people need;

•created joint investment programmes; and

• devolved greater financial powers and incentives to invest in growth to all cities.

As we made clear in our response to Lord Heseltine’s review of Growth, we intend to go further. We have committed to negotiating Growth Deals with every Local Enterprise Partnership through which we will allocate the Local Growth Fund and negotiate broader powers, freedoms and flexibilities where a strong case for decentralisation can be made. The Local Growth Fund brings together funding from skills, housing and transport and we have committed £2 billion in 2015/16 and it will continue to be at least £2 billion a year up to 2021. The Local Growth Fund includes:

• over £6 billion of transport funding;
• £300 million of additional Housing Revenue Account borrowing;
• £50 million of Local Infrastructure Funding for housing developers; and
• £300 million skills capital funding.

We are also for the first time putting £5 billion of European Structural Investment Funds for the 2014-20 period under the strategic direction of Local Enterprise Partnerships, bringing the total resource (including the Local Growth Fund) under the control of Local Enterprise Partnerships to over £17 billion up until 2020.