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MULTI-MILLION POUND BOOST FOR DEPRIVED AREAS

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Ten schemes from 15 local authorities were today awarded£126m over three years in a new Government programme to bo...
Ten schemes from 15 local authorities were today awarded£126m over three years in a new Government programme to boost the economies of some of the most deprived areas in England.

The Local Enterprise Growth Initiative (LEGI) is a joint programme between the Office of the Deputy Prime Minister, HM Treasury and the Department for Trade and Industry. LEGI is a neighbourhood renewal programme that aims to increase entrepreneurial activity in the local population; support the growth and reduce the failure rate of locally-owned businesses; and attract appropriate inward investment and franchising - making use of local labour resources.

Local Government Minister Phil Woolas announced that the first round of the programme will award a share of almost£126m to the following local authorities for the period 2006/07 to 2008/09:

1. Ashfield, Bolsover and Mansfield (joint bid) £3.8 million

2. Barking & Dagenham£15.5 million

3. Bradford £21.4 million

4. Coventry £12.6 million

5. Croydon £20.3 million

6. Easington, Derwentside, Wear Valley, Sedgefield (joint bid)

£10.2 million

7. Great Yarmouth £8.7 million

8. Hastings £3.6 million

9. St Helens £13.4 million

10. South Tyneside£16.2 million

Local authorities were invited to submit proposals setting out how LEGI funding would be used to stimulate enterprise and transform their most deprived areas. A national advisory panel, which included two senior private sector representatives, recommended that funding be awarded to these 10 bids from 15 local authorities.

Phil Woolas said:

'We aim to create prosperous, inclusive and sustainable communities for the 21st century - places where people want to live that promote opportunity and a better quality of life for all. It is crucial to ensure local authorities in the most deprived areas are provided with opportunities to stimulate economic growth through enterprise development.

'The LEGI programme, together with the Local Authority Business Growth Incentive scheme, which we announced earlier this month, confirms our commitment to supporting economic development in deprived areas and ensuring a real joined up approach is adopted across national, regional and local levels to reduce the gap between deprived areas and the rest.'

LEGI closely follows the principles of devolution and provides local institutions and communities with the authority and freedom to best determine local needs and develop targeted solutions for deprived areas. John Healey, Financial Secretary to the Treasury, added:

'Our aim is to encourage a step-change in economic activity in some of the most deprived areas in England.

LEGI is a new approach and we are backing the best of more than 50

bids with substantial flexible and long-term funding. The action we

want to support should boost the enterprise base in areas which need increased entrepreneurial activity, more sustainable growth of local businesses and greater investment in local jobs.'

DTI Minister forIndustry and the Regions Alun Michael said:

'Enterprise is a key driver for our economy and the importance of this new initiative is demonstrated graphically by two key facts from the latest Global Entrepreneurship Monitor survey. First, the survey shows that the UK has the third highest rate of entrepreneurial activity of the G7 economies, behind the US and Canada. Second, the survey shows that you can teach or train people to be entrepreneurial.

'This new funding will help to create the 'can do' attitude needed to ensure that the UK continues to be one of the most enterprising places in the world. If we are to compete effectively in the accelerating global economy we have to develop that 'can do' attitude in every section of the community - including women, young people and ethnic minorities. This is particularly crucial in communities with traditionally low entrepreneurial activity.'

All eligible local authorities that have been unsuccessful in this round, and those that did not bid, will be asked to bid again in early summer this year. Ministers have asked the five LAs (Bolton, Wigan, Rotherham, Wakefield and Redcar & Cleveland) that were short-listed this time, but were unsuccessful, to submit revised proposals in the second round. In addition, the Government is particularly interested in bids from local authorities that have the lowest rates of enterprise formation and are furthest from meeting their enterprise targets.

Notes

1. For more information on individual bids contact the relevant local authority. For the latest information about LEGI visit www.neighbourhood.gov.uk/LEGI

2. The Local Enterprise Growth Initiative (LEGI) was announced in the 2005 Budget. LEGI is worth£300m over the three years to

2008-2009 subject to the comprehensive spending review. LEGI is a

long term commitment and many of these bids were for more than three years. All 10 schemes have had the first three years of their bids funded in full and further allocations will be subject to the review.

3. LEGI will be delivered through local area agreements where they exist and will form a key part of a new LAA fourth block which is based around economic development.

4. The Local Authorities that are eligible to apply are those that were listed at least once within the 50 most deprived local authorities under the various domains of the Indices of Deprivation 2000 and 2004. This means that about 90 local authorities are eligible to apply.

5. Today's LEGI awards follow the announcement of£105 million funding for local authorities also to encourage business growth. The Local Authority Business Growth Incentives (LABGI) scheme provides an incentive for local authorities to promote economic growth in their area by allowing them to be rewarded for an increase in rateable value above a certain level. LABGI was announced by Local Government Minister Phil Woolas on 8 February.

6. The national LEGI panel was made up of three senior officials from the LEGI Departments (ODPM, DTI and HMT) and two senior private sector executives, Steve Olive, vice president Orange PLC and Nicola Nichols, Charterhouse PLC.

7. The Global Entrepreneurship Monitor (GEM) UK report was published on 15 February 2006 by the London Business School. The report is the largest study of entrepreneurship in the world.

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