Ministry of Housing, Communities & Local Government
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Strengthening Local Efforts to Tackle Economic Challenges

Strengthening Local Efforts to Tackle Economic Challenges

COMMUNITIES AND LOCAL GOVERNMENT News Release (285) issued by COI News Distribution Service. 25 November 2008

The Government today announced new powers to tackle the local impacts of the credit crunch.

The reforms make it easier for action to be taken at every level to boost jobs and skills, support businesses and make sure that all areas are making plans for recovery from the economic slowdown.

Economies don't conform to local authority areas. The plans announced today ensure that powers are available to take decisions at the right level.

Today's announcement follows a public consultation on some of the commitments outlined in the Sub National Review of Economic Development and Regeneration (SNR) in July 2007. Government will legislate on these powers at the earliest opportunity.

There will be:

* a new duty on local authorities to assess the economic conditions of their area;

* New legal powers to help local authorities work together on economic development

* a new board of Local Authority leaders to provide stronger leadership at the regional level and to take over accountability from Regional Assemblies; and

* a streamlined process for regional planning

* a joint duty on Regional Development Agencies (RDAs) and the Local Authority Leaders Board to prepare and agree a single strategy for each region outside London

In its response to the consultation, the government has taken account of the views of stakeholders. In particular, the joint approach agreed by the RDAs and the LGA has been the basis for the Government's approach, which will deliver both strong partnership working and more streamlined strategic planning in each region.

Publishing the Government's final response to the SNR consultation, Local Government Minister, John Healey said:

"Every community, town, city and region needs to play its part in dealing with the current economic climate and also prepare for economic growth in the future. As part of Government's comprehensive response to the international economic situation, these SNR reforms will bring together the expertise, the will and the decision-making powers to plan effectively for sustainable economic growth in all our English regions.

"This is the latest step in the SNR's progressive evolution and devolution of new powers and freedoms for regions, cities and local authorities. These plans and the new devolutionary package for cities announced in the PBR by the Chancellor yesterday will build on reforms to 14-19 year old skills funding, city strategies on employment, the new Working Neighbourhoods Fund, regional select committees in Parliament, new economic funding powers and Multi Area Agreements. They will boost jobs and skills, increase prosperity across the country, and reduce inequalities between and within regions."

Pat McFadden, Minister for Employment Relations and Postal Affairs said: "Business success is crucial to the health of regional and local economies. It is essential that in implementing this review we focus on what business needs to survive and thrive.

"We have responded to calls from business for a streamlined system of regional economic plans to create better conditions for business success. The reforms will allow RDAs to work more closely with local councils and give them a sharper focus on promoting investment and growth in the regions."

Notes to editors

* the Government's response to the consultation on the SNR - Prosperous Places: Taking forward the Review of Sub-National Economic Development and Regeneration was published today. The consultation closed on June 20 with over 500 responses having been received. The Government's response sets out its intention to implement the following:

* a new duty on upper tier councils in England to map out their economic circumstances and challenges - this will help ensure better targeted investment in economic development by local authorities and their partners, based on a clear understanding of their economic needs

* each region in England will produce a single plan for their area so spatial and economic decisions are taken together not separately. One single regional strategy will ensure plans are connected, coordinated and complementary - whether on planning, housing, transport or economic development. Aligned plans should help regions to deliver more effectively and efficiently, with shared goals and resources, less duplication and more effective contributions from businesses and communities

* new legally-binding partnerships which pool economic responsibility within cities or sub-regions instead of efforts stopping at councils' borders. Areas will be able to form and set in law their commitment to deliver shared economic goals through ''Multi Area Agreements with duties'' or "Economic Improvement Boards". These will give partnerships between local authorities a legal status and will enable them to coordinate their efforts on economic development more effectively, to the benefit of their citizens

* new 'Leaders Boards' set up in and by every region to replace regional assemblies. These will give councillors - on behalf of their electorate - a bigger and louder say over future economic plans, to take high level decisions and influence how funding is prioritised. Leaders Boards will have a full role in developing, agreeing and delivering the single regional strategy jointly with RDAs. The boards will provide stronger, tighter leadership at regional level and a firm focus on delivering regional priorities

* a bigger role for Regional Development Agencies (RDAs). RDAs will take on a more focused investment planning approach with partners and will have joint oversight with the Leaders Board over the Regional Strategy. RDAs will also ensure that the right decisions are taken at the right level to best drive the economy, devolving decision making through investment planning

* the Government's response to the consultation is the latest in a series of reforms which follow the principles set out in the SNR. Others include:

* 14-19 year old skills funding

* city strategies on employment

* the new Working Neighbourhoods Fund

* train to Gain brokers moved to business link

* multi Area Agreements

* the new transport bill

* powers for local authorities to introduce new planning levies and business rates supplements

* regional Select Committees

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