Seven key recommendations for economic growth from the study

National and subregional growth plans should plot the path to prosperity, says the report.

Heseltine's report makes 89 separate recommendations across a broad range of areas. Below we summarise his key messages.

Create a national strategy for growth

The government should produce a national strategy for growth, including concrete commitments against which it can be held to account. It would be drawn up by a cross-departmental National Growth Council, chaired by the Prime Minister. All government departments' business plans would need to include growth commitments. The strategy would be overseen on a day-to-day basis by a growth minister supported by a dedicated secretariat.

Hand LEPs growth-related spending

Around £12 billion a year of central government growth-related spending should be made available to the public-private, sub-regional local enterprise partnerships (LEPs) via a competitive bidding process. The money, from skills, infrastructure, employment support, housing, regeneration and business support budgets, should be brought into a single pot, with the ring-fencing removed. Heseltine calculates that, if this approach had been applied in the current four-year spending review period, £49 billion would have been available through the single pot. Chancellor George Osborne responded to the report by saying there would be "concrete action" on ceding more spending to local areas.

Funding should be tied to growth plans

The money would be allocated to the subregions that produce the best growth strategies. The strategies should be drawn up by the LEPs, taking account of the national growth strategy, and would be assessed by the National Growth Council, which would approve single pot funding. The partnerships should each get up to £250,000 of new public funding in both 2013/14 and 2014/15 to devise the plans.

Revive regional government offices

Regional teams of central government officials should be re-established to support the LEPs. Heseltine says that the coalition's closure of regional government offices, which he established in the 1990s, has meant that no-one in central government looks at local issues in the holistic way needed to optimise growth. He recommends creating six or seven central government "local growth teams", each working to support a cluster of LEPs. Central government engagement with LEPs should be encouraged by requiring each cabinet minister and permanent secretary to work with one or two partnerships.

Encourage more unitary councils

Two-tier councils outside London should move towards unitary status. Heseltine says the multi-tiered system makes it hard to fully exploit economic opportunities. The Local Government Act 2010, which halted councils' exploration of unitary status, should be repealed. Formal collaborations between councils, including the creation of combined authorities in conurbations outside London, should be encouraged, as long as they align with the LEP boundary and reinforce the LEP's standing. Councils should have a new duty to consider economic development, and must collaborate on this issue with other councils in the same functional economic area.

Airport decision needed urgently

Central government must make more timely decisions. Heseltine calls on it to "clarify urgently its preferred solution to the problem of airport capacity in the South East" and "set out a definitive and unambiguous energy policy". More generally, secretaries of state would have the right to refer inter-departmental issues that had been unresolved for six months to the National Growth Council. The report says: "We must eradicate the scope to kick difficult questions into the long grass".

Create a new body for the Thames Gateway

Create a new development corporation for the Thames Gateway. "Existing arrangements for the development of the Thames Gateway are wholly inadequate," says Heseltine, who argues that there is too little business involvement in the Thames Gateway Strategic Group, the body currently taking forward the future vision for the area. The report calls for a new private sector-led corporation, but involving representatives of central government, the London mayor, the relevant London boroughs and Kent and Essex County Councils.


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