Power To Change’s Vidhya Alakeson and Jack Hunter from IPPR North discuss the Stronger Towns Fund.<\/p>\n
On the 4th March, as Brexit negotiations reached fever-pitch, Theresa May announced that the \u00a31.6 billion Stronger Towns Fund<\/a> (STF) was to be \u201ctargeted at places that have not shared in the proceeds of growth in the same way as more prosperous parts of the country\u201d.<\/p>\n The Government\u2019s intention for the Stronger Towns Fund is to build more economically prosperous towns. Specifically, it intends that the STF will be used to \u201ccreate new jobs, help train local people and boost economic activity \u2013 with communities having a say on how the money is spent<\/em>\u201d.<\/p>\n But, as yet, there are few details about what the STF will look like. We know that a total of \u00a31 billion will be allocated from 2019 to 2026. More than half this share (\u00a3583 million) will go to towns across the North of England with a further \u00a3322 million allocated to communities in the Midlands. Another \u00a3600 million will be available through a bidding process to communities in any part of the country.<\/p>\n At the time, the announcement was met with widespread criticism, particularly in terms of the level of\u00a0funding available, the proposed method of distribution and its announcement within the wider context of the Brexit negotiations.<\/p>\n Some of these criticisms are perhaps misplaced. For example, some compared the size of the Stronger Towns Fund to that of the EU structural funds in the UK, which is misleading \u2013 given that it doesn\u2019t take into account the Shared Prosperity Fund, which is the government\u2019s intended replacement for EU funds and which will be substantially larger than the Stronger Towns Fund (although there are very valid concerns about the scope, scale and timing of the Shared Prosperity Fund itself).<\/p>\n Some, however, are more valid. In particular, and despite some of the government rhetoric that accompanied its announcement, the STF cannot reasonably be expected be transformative on its own.<\/p>\n This is because:<\/p>\n <\/p>\n But despite this, there are still opportunities for a well-designed\u00a0Stronger\u00a0Towns\u00a0Fund\u00a0to make a tangible difference to the areas that it is intended to support.<\/p>\n There is also a sizeable evidence base of learning from the successes, and failures, of previous schemes. A well-designed STF could draw upon this learning and, despite the limitations inherent in its design, be used to experiment with new ways of working at the local level, and to catalyse wider systems change.<\/p>\n In this blog, we set out what an effective Stronger Towns Fund would look like. We draw upon discussions at a roundtable held in Wigan in June 2019, with stakeholders drawn from across civil society, the public sector and academia.<\/p>\n What should the objectives of the Stronger Towns Fund be?<\/strong><\/p>\n The Stronger Towns Fund is explicitly focused on towns<\/a> where levels of productivity, household income and skills are low, and where deprivation is high.<\/p>\n In this, it marks a radically different approach to the government\u2019s principal approach to economic development, which has (through the industrial strategy, and the Northern powerhouse agenda, for example) focused primarily on boosting GVA and productivity through investment in skills and transport infrastructure, targeted at sectors identified as \u2018high growth\u2019.<\/p>\n If the STF is to have its desired effect, the main objective should be to build the foundations for healthy local economies, by investing in the wider determinants of growth.<\/p>\n There is a strong body of evidence (here<\/a> for example, or here<\/a>) which demonstrates the importance of investment in social infrastructure in helping to provide the conditions for a flourishing economy.<\/p>\n As such, and given the time frames and the scale of the funds available through the STF, there is an economic case for focus investment on improving people\u2019s<\/strong> health and wellbeing<\/strong>, as a necessary foundation of a successful local economy in the long-term. Many deprived areas are characterized by low levels of social capital, poor health and multiple social exclusions. Without investment to address these issues in the first instance, schemes to raise employment and productivity will pass these areas by.<\/p>\n The government has effectively acknowledged<\/a> the importance of well-being and social capital as a foundation for economic growth, as has the Bank of England<\/a>. And there is evidence of positive links<\/a> between increasing rates of social capital and economic growth and sustainability.<\/p>\n This means making the STF about boosting participation<\/strong> rather than just employment<\/strong>. There are many people for whom getting a job is likely a long-term ambition, rather than a realistic or desirable outcome from a policy intervention. Instead, a more appropriate aim is to build community and social capital by including more people in the lives of their town, whether that\u2019s through employment, volunteering, or other forms of social participation. Over time, this can lead to higher levels of sustainable job creation<\/a>, but it can help people feel more included, involved and in control of decisions affecting their local area.<\/p>\n Finally, an objective of the STF should be to catalyse<\/strong> long term change<\/strong> \u2013 the STF should be used to generate the conditions for wider systems change that can make a lasting difference beyond the scope of the scheme itself.<\/p>\n Lessons from previous area-based initiatives<\/strong><\/p>\n This type of approach, which could be broadly characterised as community economic development (CED), is by no means new. In fact, there is a considerable weight of evidence from previous schemes, which could be drawn upon that could inform the design of the STF.<\/p>\n The most pertinent example, the New Deal for Communities (NDC) Programme, was designed to be one of the most intensive and innovative area-based initiatives ever introduced in England. Over 10 years from 1998, the fund was intended to help transform 39 areas in England which were considered to be \u2018deprived\u2019 based on the Index of Multiple Deprivation (IMD).\u00a0 The NDC Programme was focused on achieving improvements in three people-based<\/em> outcomes: education, health and worklessness and three place-based<\/em> outcomes: crime, community and housing and the physical environment.\u00a0 39 NDC Partnerships were established, each with approximately \u00a350m in funding.<\/p>\n Evaluations of the programme (for example here<\/a>) found that it had delivered positive change and in many cases made significant benefits to deprived neighbourhoods during the investment period. There was a strong emphasis on engaging with local communities, which was associated with positive outcomes.<\/p>\n However, although tangible benefits were observed, ultimately the overall impact of even a relatively well-resourced scheme such as the NDC was rather limited against the wider context of the systemic issues in the local economies. In addition, the legacy of the programme was much harder to identify. Sustainability was built in at a relatively late date, with the consequence that its lasting impact was \u201cless robust than many partnerships would wish\u201d.<\/p>\n Wider evidence from evaluations of other schemes supports this. For example, a recent review<\/a> by the Community Wealth Alliance found that the success factors in neighbourhood-based regeneration initiatives included greater resident control, long-term investment, flexibility in approach, the development of an asset base in the community, and attention to legacy.<\/p>\n What lessons for the Stronger Towns Fund?<\/strong><\/p>\n Drawing upon our discussion, as well as evaluations of previous schemes, we set out the following 5 principles for a Stronger Towns Fund that is designed to meet the objectives presented above regarding well-being, participation <\/strong>and long-term change<\/strong>.<\/p>\n Five principles for a Stronger Towns Fund:<\/strong><\/p>\n Local control and ownership of schemes was consistently identified as an important step towards a successful scheme that has a lasting and impactful legacy.<\/p>\n Previous schemes have tended to be reluctant to hand over real power to communities \u2013 and that this has undermined well-intentioned programmes that have, as a consequence, resulted in projects that were neither desired nor valued by the people they were intended to help.<\/p>\n Allowing for local ownership will have consequences for the governance of any local scheme. For example, while involvement of the Local Enterprise Partnership (LEP) will be important to ensure integration with wider economic strategies, they might not be best placed to lead on this \u2013 particularly given that they have to date had little or no focus at the neighbourhood or community level. As Locality have argued<\/a> in the context of the Shared Prosperity Fund, the government could consider whether it might allocate funds to \u201ccommunity-led partnerships\u201d, comprised of community organisations, residents, local businesses and councils, built around a shared vision for their area.<\/p>\n Involving residents and community groups is essential but it requires resource to make this effective. Drawing on lessons from the NDC, locally-led schemes should ensure time and resource are invested in training for community representatives, and on building and demonstrating resident representation.<\/p>\n As a centralised pot of funding, where a government department in Whitehall is ultimately responsible for the design of how funds should be spent, there is a substantial risk that the Stronger Towns Fund is too restrictive to be useful.<\/p>\n To mitigate against this, the government should build in the maximum amount of flexibility into the design of the STF, including allowing local areas to set their own outcomes, in order to maximise community control and community buy-in (and therefore legacy), as well as ensuring that any money is spent in a way that is most likely to make a tangible difference to the communities that it is \u00a0intended to benefit.<\/p>\n Flexibility also allows for a more joined-up approach with regard to schemes that are already in place, including EU funded programmes. Evidence from previous work (such as CLES 2017<\/a>) found that a key feature of successful schemes is that they are integrated with and build upon existing local plans, in order to deliver wider benefits.<\/p>\n\n
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