11/03/2019

The Stronger Towns Fund – It’s just a bit weak

Why The Stronger Towns Fund won't make up for years of successive cuts to local authority budgets.

In what many have described as a bid to secure the support of Labour MPs in constituencies that voted leave ahead of a crucial Brexit vote on the 12 March, Theresa May has unveiled £1.6bn worth of funding for regional towns.

While the motive is being called into question, money is money and the idea behind the Stronger Towns Fund is to address regional inequalities, with the money being used to create jobs, train local people and boost investment.

But is this new investment going to help plug the funding gap left by years of cuts? Is it going to compensate for the loss of EU structural funding? The short answer is no.

Local authorities have been navigating austerity since 2008 and the 2019 spending review is going to be critical to the continued delivery of vital local government services. The government did announce in July 2018 that a Shared Prosperity Fund would be introduced to mitigate against the loss of EU structural funding, however, like much of Brexit, there is a continued lack of clarity on the detail, which makes it difficult for businesses, communities and local authorities to plan beyond 2020.

The cumulative cuts to local authority budgets in England since 2010 has been £15.7bn, the £1.6bn Stronger Towns Fund would only just compensate for the loss of EU structural funding the West Midlands and North of West England will face if the new funding was solely allocated to these two regions.

But the reality is the £1.6bn pot of money from the Stronger Towns Fund does nothing to compensate for years of austerity, it is to be invested over seven years and will be divided between a number of towns, which means that the funding splits into tiny pools of money for each region – from £25 million for the East of England up to £281 million for the North West.

The cash being made available is less than 2 per cent of English local authority spending and we are still waiting for a funding announcement for Wales, Scotland and Northern Ireland. We can see the impact council cuts are having on communities and funding that breakdowns to a maximum of £40 a person isn’t going to make the fundamental difference we need.

Local authorities are at breaking point and while they are looking for opportunities to innovate and maximise income through utilising their estate, they need more support.

Mark Robinson, Scape Group Chief Executive

Towns across the UK are vital to successful local economies. Over the last decade we have seen, and are continuing to see, the impact of local government cuts on the provision of services. We need to acknowledge that libraries, swimming pools and parks alongside other council-maintained services draw people in and create a sense of community, which is vital to encouraging people to both stay in the area and move to the area.

As the retail sector continues to take a hit from online shopping, we have also seen an increase in empty shops littering high streets. This will have a knock-on effect on the value of commercial land and will impact business rates – further harming the solvency of local authorities.

For towns to survive, especially those who have lost their traditional industries, it is crucial that there is a pool of money for local authorities to invest in essential infrastructure. Towns flourish when they are well-connected – a regular bus service, a train station, reasonable parking costs – all of these things invite people in and make towns more accessible to employees.

Whether it is transactional politics or not, local authorities would welcome funding that will enable them to deliver essential services, provide employment and create flourishing high streets for their local communities.

The problem is that the Stronger Towns Fund doesn’t go far enough.

Written by:

Mark Robinson

Group Chief Executive

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