New resources and new responsibilities for RDAs

One of the cornerstones of the Government’s new regional economic policy today received a major boost as the Chancellor, Gordon Brown, unveiled substantial new resources and new responsibilities for the Regional Development Agencies, further strengthening their role as catalysts for economic development in the regions.

In his announcement of Government spending plans for the next three financial years, the Chancellor built on the additional £185m already allocated to the RDAs for 2003-04, by providing them with an additional £82 million in 2004-05 and £204 million in 2005-06. Taking account of the estimated reduction in Single Regeneration Budget commitments, the RDAs will have an effective increase in the resources at their disposal of £910 million by 2005-06 compared to 2002-03. These significant new funds will be used to boost the RDAs’ work on driving forward economic development and regeneration in the regions.

RDAs are being given considerable new influence in areas with a direct bearing on the regions’ economic performance. For the first time they will be given responsibilities in the areas of transport, tourism, planning and housing. They will also work closely with the Small Business Service (SBS) and Learning and Skills Council (LSC) to pilot the regional management of services to small businesses and improvements to adult skills.

The Chancellor stressed today that, in return for the flexibility given to RDAs, he will be looking to them to deliver against the stretching targets that have been set for them by their sponsor Departments.

Welcoming the settlement, the RDAs’ lead sponsor, Secretary of State for Trade and Industry Patricia Hewitt, said today:

“I am delighted with the very good settlement for the RDAs announced today by the Chancellor. It sends a strong signal of this Government’s commitment to the regional agenda, backing up the move towards greater flexibility and earned autonomy elsewhere. This settlement will ensure that we are able to maximise the benefit of a combination of the RDAs’ strategic overview of the regions and the sub-regional and local knowledge of what will work best.

“This spending review announcement demonstrates the Government’s commitment to ensuring the regions play a full part in providing opportunity for everyone to fulfil their potential through education and employment and to promote a fair and inclusive society in which communities are productive, healthy and secure.
“On a personal note, as lead sponsor for the RDAs, I am particularly pleased that, with the advent of the Single Pot, we are all able to benefit from commonsense and co-operative partnership working in Whitehall as well as in the regions. I am pleased to welcome DCMS as a fellow contributor to the Single Pot, and look forward to continued joined-up working.”

Notes for editors

1. The eight Regional Development Agencies for English regions outside London were created in 1999, whilst the London Development Agency was established in 2000.
Since 1 April 2002, the funding streams from different Government Departments (DTI, ODPM, DfES, DEFRA, BTI) have been amalgamated under the ‘Single Pot’ funding mechanism.

2. As a result of the additional functions RDAs have been given for tourism promotion in this Spending Review, DCMS will become an RDA sponsor department from 1 April 2003. Once DCMS has completed its review of the structure of English tourism promotion, full responsibility and funding for managing regional tourism promotion will be given to the RDAs.

3. SBS and RDAs will pilot and evaluate different RDA-led approaches to achieving improved coordination of business support services at the local level and ensuring that local Business Link services promote Regional Economic Strategies. Examples of such approaches include piloting the setting up of RDA business support boards to coordinate business support activities and piloting regional management of Business Link services in one or two regions. The SBS will work closely with pilot RDAs. These pilots should start by April 2003. In the light of the evaluation of these approaches and the results of the SBS drive to improve the delivery of services from Business Link operators over the next year, the government will consider what further changes in the organisation and management of Business Link operators might be appropriate. Pilots of RDA-led approaches to coordination and management of Business Links services will commence by April 2003. A further announcement will be made on which RDAs have been selected to pilot business support boards, and which will pilot RDA management of Business Links operators.

4. As part of a drive to strengthen the regional dimension to skills, pilots will operate from April 2003 in one or two regions whereby budgets for adult learning are pooled between local LSCs and RDAs and coordinated in partnership. A review of funding for adult learning, to be completed in time for new arrangements to be introduced by April 2004, will consider how current funding arrangements can be reformed to enable RDAs to play a full and effective role in developing and implementing regional skills strategies.

5. As a result of this settlement, the total amount of funding allocated to the RDAs’ Single Pot for the years 2003-04 to 2005-06, broken down by Department, will be as follows:

£ million	2002-03	2003-04	2004-05	2005-06
DTI (incl BTI)	172	191	236	296
ODPM	1369	1522	1552	1609
DfES	42	42	42	42
DEFRA	42	41	46	51
DCMS	0	2	2	2
Total RDA funding ("Single Pot")	1625	1798	1878	2000

For further details please contact the DTI Press Office on 020 7215 2345 or visit the DTI website at www.dti.gov.uk. A full set of Spending Review 2002 Press Notices is available at www.hm-treasury.gov.uk.