The Government has announced that following an information gathering exercise earlier this year, it is now transferring the core functions of the Local Enterprise Partnerships (LEPs) to local councils. 

Whilst the LEPs will no longer exist in their current form, the Government has promised to provide ‘some revenue funding’ for 2024/25 to support authorities to “deliver the functions currently being delivered by LEPs”.  However, it has stated that “funding beyond 2024/25 is subject to future Spending Review decisions.”

In a letter to all LEP Chairs and Local Authority Leaders, Dehenna Davison MP (Con, Bishop Auckland) and Kevin Hollinrake MP (Con, Thirsk and Malton) cited an ‘overlap’ between the work of LEPs and LAs as the primary reason for the move.  The letter goes on to say that there is scope for “greater join-up, efficiencies, and clarity for the private sector by these functions being discharged within Mayoral Combined Authorities, devolution deal areas and upper tier local authorities, working together as appropriate.”

The Local Enterprise Partnerships were introduced in 2010 and there are currently 36 operating in England, reflecting functional economic areas.  The LEPS are also responsible for Growth Hubs, a network of locations across England offering SMEs a place to meet and free business support and advice.

LEP Network Chair Mark Bretton said the announcement was a ‘watershed moment’ and thanked all involved for their efforts:

“To all my LEP colleagues, whether you are one of the over 2000 business leaders giving our time mostly freely, a leader in FE, HE or the third sector, a Local Authority board member or one of the over 1000 employed team members, thank you. Thank you for pulling out all the stops to address the three reviews, for going the extra mile during the pandemic and for keeping going as we steered ourselves to today’s outcome.  A recognition that what we do matters and should not be lost. I know your local businesses and communities value your contribution highly whether it is in support of skills, delivering complex infrastructure, seeding new businesses or through our excellent Growth Hub network.  Getting these final next steps right is therefore vital to ensure that the capabilities that we have spent so long developing are protected and that our talented people are fully respected.”

A recent survey by the British Chambers of Commerce looking at the suitability of SMEs’ local trading environments, found that those based in rural areas were less optimistic about the future, citing access to talent, public transport, and connectivity as key issues. 

However, Dev Chakraborty, the Deputy Chief Executive at GFirst LEP (Gloucestershire Local Enterprise Partnership) has told RSN that local businesses will not be left high and dry. He said:

“This announcement has been in the offing for many months now.  It has been a turbulent time for staff but we are now looking to the future.

“We know that our services, especially the Growth Hubs are vital for many SMEs especially in rural areas like Gloucestershire.  The good news is that the Growth Hub network should continue until at least March 2025, so local businesses struggling with issues like recruiting staff to grow their business or accessing finance will still have access to a Hub including free, impartial advice from our experts who staff them.”