The TaxPayers’ Alliance report into the performance of regional development agencies was always going to be a brutal condemnation of what is termed “wasteful bureaucratic excess by unaccountable quangos”. Given the TPA’s mission to act as self-appointed scrutineers of the finances, an investigation into RDAs would have been akin to hitting a barn door from five paces.
The agencies are, in many ways, easy targets. Tightly bound by Government red tape, covering unwieldy geographical areas, these bodies are the very antithesis of the dynamic, fast-acting economic intervention envisaged when Labour came to power in 1997.
Advantage West Midlands does not escape the TPA’s wrath, finding itself accused of squandering money on nonsensical ventures. And it is certainly the case that serious questions remain unanswered about the wisdom of subsidising BizTV to the tune of £3.6 million, or paying £118,000 to organise a one-day conference to discuss the region’s economic future.
But these are relatively small amounts of money in the overall scheme of things. The far more challenging part of the TPA paper concentrates on the RDAs’ record on the number of new jobs created since 1999 and the number of small businesses helped to get off the ground. The picture nationally, and in the West Midlands, is not good. Regional economic performance actually improved at a faster rate before the RDAs were established, even though the agencies were in place during the period 2000-2005 when the UK economy was growing at a healthy rate.
The TaxPayers’ Alliance believes RDAs should be abolished, with the £15 billion a year saved spent on reducing corporation tax for small businesses. Another idea, which it is not surprising the TPA ignores given the organisation’s mistrust of local government, is to hand back powers for economic development to councils.
Giving town halls responsibility for work currently carried out by the RDAs would restore accountability, while bringing decision making much closer to communities where unemployment, a lack of skills and deprivation is rife. Certainly, local authorities feel they have something to prove, having spent nine years complaining about the length of time taken to extract funding from AWM, and could bring a fresh impetus to regeneration.
The Government has other ideas, and intends to strengthen the powers and budgets of the RDAs when regional assemblies disappear in 2010. This does not, judging by past performance, fill us with any great enthusiasm.