Issn: 1367–3882

QUARTERLY

MAGAZINE OF THE

THE VOICE OF THE MEMBERSHIP

NO. 281, SPRING 2011

REGIONALISM VERSUS LOCALISM

6

In Depth, pp. 6-9 Regions No 281 Spring 2011

Setting the

sceneS u b - n a t i o n a l

development in

England is once

again at a deci-

sive crossroads

in its persistent

journey of state-

led restructuring.

Whereas the territories of Scotland,

Wales and Northern Ireland achieved

significant devolutionary packages under

the UK’s Labour Government (1997-

2010), decentralisation in England was

rather more constrained and could be

more aptly described as a regionalisation

of central government functions. Since

the election of a Conservative-Liberal

THE REGIONAL LACUNA: A PRELIMINARY MAP OF THE

TRANSITION FROM REGIONAL DEVELOPMENT AGENCIES TO

LOCAL ECONOMIC PARTNERSHIPS

Lee Pugalis, Newcastle University and County Durham Economic Partnership, UK

Figure 1: Map of English regions indicating RDA spend and impacts

Democrat (Con-Lib) UK Government

in May 2010, the demise of England’s

regional framework has featured promi-

nently in political discourse. It is a case

of ‘out with the old’, including Regional

Development Agencies (RDAs),

Government Offices for the Regions

and Regional Leaders’ Boards, and ‘in

with the new’ such as Local Enterprise

Partnerships (LEPs), as the Coalition

Government embark on their quest of

economic rebalancing and recovery at the

same time as state spending retrenches.

An ‘orderly’ transitional period is

programmed to be largely completed by

March 2012, the outcome being a radical

transformation of the geography of sub-

national development policy, governance

and delivery. Consequently, these shifts

have stimulated a resurgence of interest

in the future of sub-national development

policy, including the ‘politics of scale’, une-

ven development and spatial inequalities,

as observed by the editors of this magazine

in issue 279. The transition is all the more

intriguing from a European vantage, con-

sidering that regions are the bedrock of the

EU’s territorial cohesion policy, perform-

ing a key role in the administration of the

European Regional Development Fund

(ERDF). Contemplating how this transi-

tion may play out, I sketch a preliminary map

of the road from RDAs to LEPs. Whilst

the analytical focus is spatially specific to

England, the policy journey of economic

space in transition is of wider appeal.

Hopefully the international community

of researchers, practitioners, policy-makers

7

In Depth

and academics can draw on these insights

to help inform the scale, scope and pace

of policy transitions in other time-space

trajectories.

From RDAs to LEPsConceived under a Labour Government,

RDAs are non-departmental public bod-

ies, or quangos, set up under the Regional

Development Agencies Act 1998 to be

strategic drivers of regional development.

Responsible to Whitehall and governed

by state appointed private sector led

boards, the nine RDAs were arguably

the chief institutional configuration

under Labour for promoting enterprise

and innovation within the regions (see

Figure 1). Until the Coalition signalled

their abolition (subject to legislation),

RDAs performed at a key nexus of

power between localities and Whitehall,

and were collectively responsible for

the annual administration of billions of

pounds of central government Single

Programme resources and ERDF.1

Guided by the objective ‘to help

strengthen local economies’, LEPs

were put forward by the Coalition

Government as the only key apparatus

by which to reform sub-national devel-

opment. Circumventing the customary

consultation procedures and discarding

other options, such as reviewing RDAs,

the Con-Libs invited “councils and busi-

ness leaders to come together to consider

how [they] wish to form [LEPs] ... ena-

bling councils and business to replace the

existing [RDAs].”2 This open invitation

was by way of a letter, dated 29 June,

2010, penned by Vince Cable, Secretary

of State for Business, Innovation and

Skills, and Eric Pickles, Secretary of State

for Communities and Local Government.

The letter is an example of the Coalition’s

so-called permissive policy approach

(i.e. unautocratic), which is claimed to

reflect localist ideals (or a ‘Big Society’)

whereby the delivery of services and

other responsibilities are passed-down

to local communities and volunteers.

Yet, the letter states that Government

is “reviewing all the functions of the

RDAs”, surmising that ‘some of these

are best led nationally, such as inward

investment, sector leadership, responsi-

bility for business support, innovation,

and access to f inance.” Arguably, the

centralisation of these RDA responsibili-

ties would significantly undermine the

Coalition’s localism agenda together with

the ability of LEPs to play a significant

role in developing their local economies.

Therefore, the purported transition from

a regionalist framework (synonymous

with the previous Labour Government)

to a localism approach (championed by

the Con-Libs), may not be as clear-cut

as some would have us believe. Indeed,

there is a suspicion that the rhetoric of

decentralisation may be thinly disguising

centralist tendencies (Pugalis, 2010).

LEPs: Guiding (state-set)

parametersBy way of the Cable-Pickles letter, the

Coalition Government set an extremely

ambitious deadline of 6 September 2010

for joint public-private LEP propositions.

Government provided stakeholders with

less than 70 days to develop proposals,

guided by their embryonic ideas for LEPs

and some broad parameters covering role,

governance and geography (see Figure

2). Indeed, with Ministers encouraging

‘a wide range of ideas’ underpinned by

little more than a few paragraphs of loose

guidance, stakeholders were tasked with

quickly negotiating territorial alliances

against the background of local politics,

histories of cross-boundary and multi-

sector collaboration, business views and

the logic(s) of functional economic geog-

raphies. An additional layer of complexity

was the fact that the Government’s White

Paper on Local growth (HM Government,

2010) was not published until 28 October

2010 – at which point the deadline for LEP

submissions had passed. Consequently, pro-

posals – of variable quality, ambition and

stakeholder buy-in – were quickly worked

up on the basis of limited national criteria

and the absence of even a partial road map

of the Con-Libs’ economic transition plan.

The result was the submission of over 60

bids, of which many were clearly ‘rival’

and/or geographically overlapping.

The transition periodContending that the transition period is

likely to be anything but orderly, what

follows in the remainder of this article

is a preliminary map as I navigate the road

from RDAs to LEPs. Firstly, I consider

timing to be paramount. With most

RDAs set to stay operational (to lesser

or greater degrees) until March 2012, it is

crucial that LEPs hit the ground running

and maintain momentum. Coordinating

the rollout of one sub-national economic

entity with the rollback of another would

aid the transfer of key skills, knowledge

and assets. If the Con-Libs decide to cash

in on RDA assets, as a short-term strat-

egy to ease the budget deficit by way of a

‘fire sale’, it may well result in significant

delays to long-term regeneration schemes

Figure 2: Government parameters

Role Governance Geography- Provide strategic leadership; setting

out local economic priorities

- Help rebalance the economy towards

the private sector; creating the right

environment for business

- Tackle issues such as planning

and housing, local transport and

infrastructure priorities, employment

and enterprise, the transition to the

low carbon economy and in some

areas tourism

- Collaboration between business and

civic leaders, normally including

equal representation on the boards of

these partnerships

- Work closely with universities and

further education colleges

- A prominent business leader should

chair the board

- Sufficiently robust governance

structures

- Proper accountability for delivery by

partnerships

- Better reflect the ‘natural’ economic

geography; covering the ‘real’

functional economic and travel to

work areas

- Expect partnerships would include

groups of upper tier local authori-

ties, which would not preclude that

which matches existing regional

boundaries

8

underpinning the revival of depressed

local economies. With a dearth of inves-

tors, and development financing almost

impossible to obtain without pre-lets,

the stalling and ‘mothballing’ of complex

urban regeneration projects would strug-

gle to regain development momentum.

Secondly, the positive role and ambi-

tions of LEPs must be supported with a

reasonable level of resources. With the

Coalition reluctant to support the single

running costs associated with operat-

ing a cross-boundary economic agency,

although there are signs of a change

in stance,3 the goodwill and financial

backing of local partners will only go so

far. Regardless, the issue of day-to-day

operational costs will be incidental if the

finance (including lending powers) is not

in place to deliver. Lib-Con rhetoric that

the public sector needs to retract from

an interventionist role in order to release

the business community to lead an eco-

nomic recovery may have some merit in

those places underpinned by a relatively

buoyant private sector. However, such an

approach is likely to perpetuate uneven

patterns of spatial development and

exacerbate socio-economic disparities

(Peck, 2010). For the rest of the coun-

try, the areas of need and public sector

dependency, lying beyond the places of

(investment) choice and opportunity,

there is a danger that the progress made

over the previous decade up until the

credit crunch will rapidly recoil. Slavishly

reducing regeneration resources for those

places most in need, and in turn where

the private sector refuses to invest, is akin

to robbing Peter to pay Paul: savings

made through regeneration funding cuts

are likely to be soaked up by increased

demand for health and welfare support,

for example.

Thirdly, a cavernous policy vacuum

is expanding between localities and the

national level. Whilst the letter was co-

signed by Cable and Pickles, providing

the impression of a united front, noises

of a ‘turf war’ between the two figure-

heads and their respective departments

4

16

7

21

22

19

6

10

15

4

13

11

26

3

17

2

5

9

20

18

1

12

28

27

8

24

14

23

25

Local Enterprise Partnerships

Produced by the Geographic Analysis Team, ASD© Crown Copyright and database right 2010. All rights reserved.Ordnance Survey Licence number 100018986 2011 01 03

Data Sources:OS Boundary Line0 30 60 9015

Kilometres

±

Isles of Scilly Inset

List of local enterprise partnerships

1 Birmingham and Solihull with EastStaffordshire, Lichfield and Tamworth

2 Cheshire and Warrington

3 Coast to Capital4 Cornwall and the Isles of Scilly

5 Coventry and Warwickshire

6 Cumbria

7 Greater Cambridge and GreaterPeterborough

8 Greater Manchester

9 Hertfordshire10 Kent, Greater Essex and East

Sussex

11 Leeds City Region

12 Leicester and Leicestershire13 Lincolnshire

14 Liverpool City Region

15 New Anglia16 Northern Eastern Partnership

17 Nottingham, Nottinghamshire, Derby,

and Derbyshire18 Oxfordshire City Region

19 Sheffield City Region

20 Solent

21 South East Midlands22 Stoke-on-Trent and Staffordshire

23 Tees Valley

24 Thames Valley and Berkshire25 The Black Country

26 The Marches Enterprise Partnership

27 West of England28 Worcestershire

Local Authority Districts in

overlapping local enterprisepartnerships

Figure 3: The geography of LEPs

In Depth Regions No 281 Spring 2011

9

continue to grow louder. The former is

considered to see the benefits of retain-

ing a regional economic presence in

some parts of the country such as the

North and Midlands, whereas the latter

is antipathetic to anything ‘regional’ or

indeed ‘strategic’ as many planners and

developers would attest in response to

the hasty revocation of Regional Spatial

Strategies, (Pugalis and Townsend,

2010). In policy and practice terms, the

Coalition’s intentions and policy shifts

thus far reveal an outright abandonment

of regional policy-architecture, which

has created a regional lacuna.

A map of the ‘first wave’ of 24 LEPs

approved by Government shows the

complexity of the geography of emerg-

ing economic governance. Incidentally,

from the announcement of the first wave

of LEPs in October 2010 up to the date

of writing in January 2011, four further

LEPs – Norfolk & Suffolk, the Black

Country and Worcestershire – were

approved between December 2010 and

January 2011, with others set to follow

(see Figure 3). Hence, whilst it is reason-

able to surmise that the white areas on the

map will continue to reduce, the geogra-

phy of sub-national development policy,

governance and delivery is at the cusp of

radical transformation. Estimating that

circa 35 LEPs could eventually replace

the eight RDAs outside of London, a key

question is how London-based ministerial

departments could feasibly engage with

each LEP on an individual basis? Indeed,

will Whitehall mandarins appreciate

the spatial particularities of these new

geographies of economic governance?

More so, what prospects for non-LEP

geographies of England?

Without some form of strategic eco-

nomic body to negotiate the policy space

in between sub-regional groupings of

localities and the national level, I would

caution that the spatial particularities of

LEPs, outside the ‘big hitters’ organised

around a core city such as Birmingham

or Manchester, may struggle to make

their voices heard in Whitehall policy

circles. Notwithstanding the limitations

of regional administrative areas in pro-

viding the ideal spatial fix for the delivery

of all sub-national policy, strategically-

focused regional bodies would help

in coordinating the activity of LEPs,

facilitating cross-boundary cooperation,

the management of some programmes

(including ERDF) and could even

assume responsibility for signif icant

strategic projects (unworkable at lower

or higher spatial scales), such as some

transport schemes. It appears to me that

the Coalition have become ideologically

blinded to the reality that the English

regions, or at least some of the regions,

provide a pragmatic spatial scale for

bridging the national-local divide.

Concluding remarks on a

shifting agendaInterest in LEPs has been enormous,

with 62 propositions submitted to

Government ahead of the September

2010 deadline. This is perhaps hardly

surprising considering that LEPs have

been conceived as a direct replacement for

RDAs, notwithstanding the recentralisa-

tion of some notable responsibilities to

the state. Whilst the White Paper (HM

Government, 2010) is now in circulation,

countless questions remain in respect of

the transitional process and the role(s) of

LEPs. How long will it take to establish

LEPs as effective economic leadership

vehicles? When established, will the

boards of LEPs be composed of the usual

suspects? Alternatively, are democratic

accountability and business leadership

a recipe for disaster? Might governance

issues and institutional reconfigurations

distract attention from delivering positive

change? How will succession planning

be carried forward and in what ways

may noteworthy RDA successes provide

a positive legacy for LEPs? How will

ERDF be managed and by whom? In

terms of multi-level governance and

coordination across multiple spatial

scales, how will nationally ‘led’ eco-

nomic programmes interact with LEPs?

Indeed, does such an approach run the

risk of contradicting the localism agenda?

Only time will tell. It will be interesting

to take stock of the transition and how

LEPs are bedding down in a year’s time.

However, at this juncture I am sceptical

that the Coalition Government posses

the majority of the answers.

Critics suggest that this slight reshuf-

fle of the same pack of cards is merely

“economic development on the cheap ...

a no-frills version of the economic pol-

icy of the past decade” (Larkin, 2010),

that may marginalise or overshadow

the interests of some places and groups

(Herrschel, 2010). If this is so, then

improvements remain ambiguous, but

the potential to lose out is significant.

Not least for any place on the periph-

ery of a LEP board’s spatio-economic

ReferencesHerrschel, T. (2010), “Regionalisation,

marginalisation and the role of govern-

ance in Europe and North America

(Part 2),” Regions 280(Winter), p.28.

HM Government (2010), Local growth:

realising every place’s potential,

London: The Stationery Office.

Larkin, K. (2010), “Regions after RDAs,”

Public Finance Blog, 1 July.

Peck, F. (2010), “Post Election policy

debate in the UK: Whither the regional

agenda?,” Regions 279, pp.4-5.

Pugalis, L. (2010), “Looking Back in

Order to Move Forward: The Politics

of Evolving Sub-National Economic

Policy Architecture,” Local Economy,

25(5-6), pp.397-405.

Pugalis, L. and Townsend, A. (2010), “Can

LEPs fill the strategic void?,” Town &

Country Planning, 79(9), pp.382-87.

Dr Lee Pugalis is a Visiting Fellow

at the Global Urban Research Unit,

Newcastle University, and man-

ages the County Durham Economic

Partnership. Prior to his existing role,

Lee was the Regeneration Specialist

Advisor to One North East Regional

Development Agency and has also

worked for central and regional gov-

ernment in policy-making roles.

lee.pugalis@ncl.ac.uk

priorities or, worse still, for any white

space on the map left out of the LEP

equation. Let us hope that the Lib-Cons

stay true to their localism philosophy,

which would put the onus on localities

to devise unique policy solutions, sup-

ported by financial freedoms, flexibilities

and powers. Maybe those plying their

trade outside of England can ref lect

on this form and manner of state-led

restructuring and act accordingly the

next time a new (and presumably better)

policy innovation is proposed.

For a more extensive examination of

the issues addressed in this article consult:

“Sub-national economic development:

where do we go from here?”, Journal of

Urban Regeneration and Renewal.

Endnotes1 The RDAs’ combined budget was

£2.3 billion in 2007-08 and remains at

just over £1.4 billion in 2010/11.

2 The letter is available at:

http://www.parliament.uk/deposits/

depositedpapers/2010/DEP2010-1363.pdf

[accessed 2 July 2010]

3 In January 2010, the Coalition announced

that it is to launch a £4 million fund aimed

at boosting the analytical capacity of LEPs.

In Depth

Xyxyyxyx Yxyyxyyyx Regions No 281 Spring 2011

32

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RegionsTHE VOICE OF THE MEMBERSHIP

The Regional Survey in this issue focuses on regional integration in Latin America. Our contributors explore the difficulties that these countries have traditionally faced in integrating interventions to develop their peripheral regions as well as the potential for growth that coordinated interventions might generate in the continent. Despite the widely held belief that the lack of linguistic and religious barriers would simplify integration efforts between these countries; the lack of both political and economic coordination, the large size of the areas, regional disparities both between them as well as within them, and poor infrastructure have always worked against integration efforts in the region.

This series of articles edited by Carola Ramon-Berjano provides expert views on three different integration initiatives in Latin America; namely MERCOSUR (the area between Argentina, Brazil, Uruguay and Paraguay), UNASUR (a more ambitious project involving 12 Latin American countries) and ZICOSUR (an economic zone comprising neighbouring and peripheral areas of Argentina, Chile, Paraguay and Bolivia). These articles approach the issue of larger versus smaller integration schemes as well as differences and similarities between countries and regions. These schemes are viewed at different scales from the wider Latin American perspective, to the national and regional levels to illustrate how the potential gains as well as problems vary between countries and regions.

This issue also contains insights into the changing landscape of regional and local development in the UK and in France. John Diamond discusses the new Coalition Government’s concept of the “Big Society” and renewed interest in ‘localism’ in the UK. He argues that these concepts may have little to do with democratisation of local decision-making but more to do with a decline in the role of the state at all levels, including the demise of the Regional Development Agencies that were set up under the previous Labour Administration. This theme is picked up by Lee Pugalis in the In Depth article on the changing institutional structures surrounding sub-national development in the UK. It is noted that these changes are particularly intriguing from the perspective of European Cohesion Policy which remains firmly based on ‘regions’ as the basic spatial unit for territorial development. In contrast, Anna Geppert provides a research note on the French Government’s plans to strengthen the City-Region scale of development through the promotion of collaborative networks.