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Paper 4 - 24 September 1999 Meeting

ASSOCIATION OF HAMPSHIRE AND ISLE OF WIGHT LOCAL AUTHORITIES

24 September 1999

REGIONAL DEVELOPMENT AND LOCAL DISCRETION - REVIEW OF THREE CONSULTATIONS

Report by the Policy Manager

RECOMMENDATIONS

(1) That the consultations on the Regional Economic Strategy, the Review of Post 16 Learning, and on the Small Business Service be noted; and

(2) That members compare their authorities' emerging responses to these three consultations.

SUMMARY

Three major consultations of relevance to the local and regional economy have been considered by member authorities over the summer period:

The South East England Development Agency's consultation on the Regional Economic Strategy "Building a World-Class Region".

The Department for Education and Employment's White Paper "Learning to Succeed" dealing with post 16 education and training.

The Department of Trade and Industry's consultation paper on the future of the Small Business Service.

This report outlines these consultations. Authorities are responding individually and in partnership. It is felt that additional joint responses would be superfluous. This report therefore invites members to compare their authorities' emerging responses, to consider the evolving economic strategy and its means of implementation.

The Government is changing the means of implementing strategy through its proposals for "learning" and business support. Particular concerns about the Government consultations are:

the need for local discretion within the national framework

the need for continued funding provision in support of Economic Partnership initiatives

the need for close involvement of Local Authorities in the decision making process for Local Skills Councils and Small Business Service franchises.

INTRODUCTION

1. This Government has produced a stream of consultation papers. In some cases the Association has co-ordinated a joint response. In the case of these three consultations (one from SEEDA, two from central government), local authorities are already responding in partnership through forums such as the Economic Partnerships and Solent Gateway.

2. It is hoped that this meeting of the Association will allow members to take stock and consider strategic aspects of the Regional Economic Strategy (RES) and of two particular means of implementing economic strategy - via post 16 learning/training and via the Small Business Service. Summaries of these consultations are annexed.

REGIONAL ECONOMIC STRATEGY (RES)

3. The first RES for South East England was published on the day of the South East England Regional Assembly (SEERA) meeting in Oxford on 22 July. The RES was described at the HIOW meeting on 23 July when individual authorities were urged to respond direct to the South East England Development Agency (SEEDA).

4. The RES outlines the strengths of the South East region but draws attention to certain weaknesses:

under-utilised assets

lack of investment in communications

failure to provide adequate support for business - support is described as "inadequate, fragmented, unfocused and confusing"

failure to provide the necessary learning and skills training for a world-class economy.

5. The RES provides a vision and a framework for change which are based on:

extensive local consultation conducted earlier this year

Hampshire Economic Partnership (HEP) and other submissions to SEEDA on topics to be included in the RES

HIOW's discussion with SEEDA Board Chairman last November when we briefed SEEDA on key development priorities for Hampshire and the Isle of Wight.

6. The core strategy of the RES identifies the following region-wide "programme areas":

business development
learning workforce
infrastructure
environment
regeneration and communities
rural economy

Each programme area section sets out issues and challenges and makes proposals. In addition to the core strategy, there is an extensive economic profile of the South East offering a detailed analysis of seven "areas of economic generation" and areas of "economic regeneration". Parts of Hampshire and the Isle of Wight are included in three of the areas of economic generation:

Thames Valley/Basingstoke

West Surrey/North East Hampshire

Central South Axis - which includes the Solent Gateway and the Isle of Wight.

7. SEEDA is to be congratulated on producing an impressive strategy document to a remarkably tight timescale. Positive comments, (eg from HEP) include the statement that SEEDA has managed to take on many of the points raised during the initial consultation process.

8. The RES will be an important guide for future Government and EU funding into this region and for inward investment and business support priorities. The Government intends that local delivery arrangements for the new Small Business Service, for example, will be shaped by the RES. It is important to get the RES "right first time". On the other hand it is the first broad brush production of a regional strategy and it is not cast in stone. It will be reviewed and refined. Many of its proposals need detailed work to define them more specifically and to implement them in a way that can be measured. The relationship between the RES and regional planning guidance in particular needs to be developed.

9. The next step in taking the RES further locally will be to draw up and consult on "area-based economic development strategies". The exact areas on which these strategies will be based has yet to be decided.

10. We can the influence the RES and the way it is refined and implemented directly through SEEDA and also via membership of SEERA. SEERA will be considering its final comments on the RES at a full meeting on 12 October in Portsmouth Guildhall.

LEARNING TO SUCCEED

11. The Government's proposals in the White Paper "Learning to Succeed" was set out in presentations and in a paper to the last meeting of HIOW on 23 July. The key points in the proposals are:

Establishment of a national Learning and Skills Council (LSC) with responsibility for all further education and training. The LSC will take on powers from the Further Education Funding Council (FEFC), the Training and Enterprise Councils (TECs) and Local Education Authorities (LEAs). FEFC and TECs will go. Local discretion could be reduced. However, LEAs will have a new duty to contribute to arrangements in their areas.

Establishment of local LSCs as local agencies of the national LSC.

LEAs to be "at the heart of the new arrangements" via the life long learning partnerships, of which there are three in our area:

Hampshire and Portsmouth
Southampton
Isle of Wight

Work-based learning to transfer to the Employment Service in order to integrate with Welfare to Work and New Deal.

SEEDA will work with both national and local LSCs whose plans will reflect the RES.

In considering these proposals at the last meeting, Members expressed their concern about:

(1) the accountability of the local skills and learning arrangements to democratic processes;

(2) the integration of skills, learning and business support arrangements into sound local governance; and

(3) the need to ensure that adequate funding is provided, particularly to replace the "Enterprise" funds levered into our area by the TECs.

SMALL BUSINESS SERVICE

12. The consultation paper on the Small Business Service (SBS), published by the DTI, covers a much smaller area of Government expenditure but is related to the post-16 training review in that:

skills development and business development are closely inter-related

delivery of the service is closely associated with training through the organisational ties between TECs and Business Link. In Hampshire (including Southampton and Portsmouth) Business Link is a subsidiary company of Hampshire TEC, sharing the same Chairman and the same geographical area.

13. The national SBS will provide a strong voice at central Government for small businesses. It will also let contracts/franchises to local small business services which would have the same boundaries as the LSCs. The consultation paper expresses general acceptance of the Business Link service and brand, and implies the likelihood that contracts for the SBS would be placed with a reduced number of Business Link companies. The consultation paper refers to the need to link the development of the SBS with the wider agenda on economic development and social exclusion. HEP has drawn attention to the need for an integrated approach at sub-regional level. "The enterprise functions and experience of the TECs could be lost once the SBS and LSCs are set up", warns the HEP response. Funding for local enterprise initiatives could also be in danger.

NICK GOULDER 
Policy Manager

Last update: 11/10/2000
Author: Nick Goulder, Policy Manager

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