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Deloitte
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Heather Hancock, Head of Regional Development and Regeneration at Deloitte, comments on the implications of Budget 2006 for the Regional Development Agencies (RDAs).

“The Chancellor’s pre-budget report last year indicated what the key thrust of his Budget announcement for the RDAs and the regeneration sector would be.  The Government’s current approach to regional economic development - led by the RDAs - has been in place for seven years. The Chancellor announced the logical next step - to intensify their focus the globalisation opportunity, and the continuing challenge in sustaining the skills base demanded by British business.

“The Chancellor's stance offers an opportunity for the RDAs - and for the UK’s larger and more ambitious cities - to rediscover their radicalism.  Particularly for the RDAs, it is a chance to reinforce their strategic leadership role, and perhaps to free themselves from a raft of additional responsibilities they have accumulated over the last seven years.  Driving forward the city and regional response to global economic challenges requires energy and focus on some big, long term strategic and structural issues in the regional economy - the things that only RDAs can do.  It will be interesting to see whether RDAs seize this opportunity to reposition themselves, playing to their strengths, and to pass more short term or local roles down to other local players. 

“The Comprehensive Spending Review (CSR) 2007 gives the RDAs the opportunity to make a virtue out of this approach.  But the direction the RDAs take will need also to reflect the outcomes of the impending review of the effectiveness of sub-national interventions on economic development, and the regeneration and renewal of deprived neighbourhoods. Many approaches to economic development, regeneration and renewal (particularly outside the city-regions) are more focused on tackling acute social exclusion than directly addressing the UK's global economic challenges.  It isn't clear where the economic exclusion agenda sits in the face of the Chancellor's global economy focus, and in the face of a tightened public spending regime, some of these programmes may be at risk, unless they can be realigned.  It certainly could encourage those who wish to see social exclusion issues tackled by local government rather than the RDAs.

“The Chancellor’s announcement also highlights the importance of tackling the skills agenda – something which despite real efforts remains obstinately difficult to crack.”

“A renewed focus on addressing global economic challenges within a tightened public finance regime under the CSR will mean making some difficult choices. RDA’s will have to focus on long term, global-facing business support, as well as regeneration that delivers economic competitiveness within cities, and a renewed focus on addressing skills. But perhaps less investment for regeneration and renewal and social exclusion outside those areas which are considered to contribute most to global economic drivers."

Ends

Notes to editors

About Deloitte
In this press release references to Deloitte are references to Deloitte & Touche LLP which is among the country’s leading professional services firms, providing audit, tax, consulting and corporate finance services. Known as an employer of choice for innovative human resources programmes, it is dedicated to helping its clients and people excel. Deloitte & Touche LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu (‘DTT’), a Swiss Verein whose member firms are separate and independent legal entities.  Neither DTT nor any of its member firms has any liability for each other’s omissions.  Services are provided by member firms or their subsidiaries and not by DTT.  

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The information contained in this press release is correct at the time of going to press.