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'Troubling' LEP exposes governance failings

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The government has failed to clarify what role local enterprise partnerships have where elected mayors and combined authorities exits, the public accounts committee has said in a report on governance failings at the Greater Cambridgeshire and Greater Peterborough LEP.

MPs took evidence during the winter following a damning report by the National Audit Office on the LEP, which in December entered voluntary liquidation and is now merging with the region’s combined authority.

The committee’s report said the Ministry for Housing, Communities & Local Government “needs to get its act together and assure taxpayers that it is monitoring how LEPs spend taxpayers’ money and how it evaluates results”.

It added: “The department assures us that there was no misuse of public funds in this instance; however, this is due more to luck than effective oversight…we are not at all convinced that the issues uncovered in GCGP LEP might not be found elsewhere in other LEPs.”

MPs were particularly critical of former LEP chair Mark Reeve, chair of construction firm Chalcroft, who “failed to appreciate the importance of good governance, showed a lack of remorse about the outcome for GCGP LEP, and was evasive when questioned about his potential conflict of interest”.

Labour’s Meg Hillier, the committee’s chair, said: “This troubling case only serves to underline our persistent concerns about the governance of LEPs, their transparency and their accountability to the taxpayer.”

The committee said the government must be clear about LEPs’ roles, assess whether they had the right boundaries “and set out their place alongside new mayors and combined authorities”.

Ms Hillier said: “Taxpayers surveying the increasingly complex landscape of local government might reasonably ask what LEPs are for. It is wholly unacceptable that central government does not have a clear, up-to-date answer to that question.”

She called on MHCLG to rapidly implement the conclusions of a review of LEP governance by Mary Ney, former chief executive of Greenwich RBC.

MPs complained the section 151 officer of Cambridgeshire CC - the LEP’s accountable body - signed off its assurance framework “without checking all of its supporting documentation”.

Gillian Beasley, chief executive of both Cambridgeshire and Peterborough City Council, told MPs the section 151 officer’s view was that he could only check the LEP had agreed a framework in line with the national one and “it was very clear to him at that time that he was not to look at the adequacy of those documents, because there was no standard against which he should judge that”.

An MHCLG spokesperson said: “Local enterprise partnerships help drive economic growth and we have put clear rules in place to ensure they are transparent, avoid conflicts of interest and use taxpayers’ money effectively.

“We have committed to fully implement the findings of an independent expert into the way they are governed.”

Cambridgeshire said it had nothing to add to the evidence it gave the committee. The LEP have been contacted for comment.


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