The government will only agree growth deals with Local Enterprise Partnerships if ministers are confident that the funding and powers devolved will be exercised robustly, cities minister Greg Clark has warned.
Clark, who is also financial secretary to the Treasury, told a Conservative Party fringe event that there would be no automatic striking of deals with LEPs.
Under the proposals, which have emerged from Lord Heseltine’s review of local growth, LEPs will be able to bid for additional powers and a share of funding from a £2bn annual single pot.
It had been thought that all 39 LEP areas would come to an agreement with Whitehall. Government guidance stated that a ‘growth deal for every place’ would be reached to ensure nowhere is left behind.
However, there would be ‘vigorous negotiation’ between LEPs and government when the pacts are being discussed, and it ‘is not automatic’ that agreements for all areas would be reached.
‘If there are places taking on substantial budgets and powers currently vested in central government [and] if there isn’t the confidence that they’re going to be exercised well and robustly, then no deal will be done,’ he said.
‘It has to be a serious city or a county that will say, “We have the capacity, we have the ability, we have the vision, to do these things that are currently exercised by central government, and to do them locally”. And if that is demonstrated, we will say yes.
‘So it’s going to be a vigorous discussion, and a lot depends on it, and the one thing you can count on is my desire to do these ideas if it is in the interest of both parties.’