October’s Autumn Budget brought a fresh injection of new funding into economic development. This included the first instalment of the Levelling-Up Fund totalling £1.7bn. In addition, £220m of investment in the UK Community Renewal Fund was announced. This is regarded as a one-year prequel to the long-awaited UK Shared Prosperity Fund (UKSPF).
Levelling Up Fund
The Levelling Up Fund (LUF) provides capital funding, with a focus around transport, urban regeneration, and cultural infrastructure, enabling spending over a multi-year period. It covers comparable areas of investment to the Local Growth Fund which preceded it. Similar to the Community Renewal Fund detailed below, it is being channelled through local and combined authorities.
Community Renewal Fund
The Community Renewal Fund (CRF) is valued at £220m. It constitutes approximately 90% revenue funding that will support most of the interventions currently funded under the European Regional Development Fund (ERDF) and European Social Fund (ESF) programmes. These funds are now being wound down towards closure by 2023. CRF includes investment in:
people – focusing on skills, training, and employability support.
businesses – with innovation support, enhanced energy efficiency, general business support.
places – investing in energy infrastructure, culture led regeneration approaches, broadband investments, and public realm improvements.
The CRF will support projects up until June 2022, by which time it is expected that the UKSPF will take over investment in these intervention areas. Prospective projects being delivered during this period will need to launch and deliver quickly so will benefit from drawing on strong existing structures and tried and tested methodologies.
With substantial funding announcements, and sustained Government messaging around levelling up and devolution to local areas, this is an important time for Councils and Combined Authorities to take a more strategic approach to the monitoring and evaluation of projects and programmes focused on economic development. Well commissioned evaluation work can be critical for a number of reasons.
A localised evidence base enables stronger local provisions and outcomes
If local areas are to have control of greater resources for economic development, it is important for them to build a strong local evidence base focused on what works in that area. This means using robust evaluation methods to analyse and draw out lessons about the effectiveness of programme delivery, the impacts that have been generated, and how cost-effective programmes have been. Local evidence is therefore critical. Although it can be useful to draw inspiration from schemes elsewhere, we know for example that the landscape for economic development programmes that work around Wavehill’s office in West Wales will be very different from the economic development landscape around our offices in London, Bristol, or Newcastle. Understanding what works locally, is critical.
Preparing for the UKSPF
The CRF has clearly been established as a warm-up to the launch of the UK Shared Prosperity Fund in 2022, rather than a £220m fund. The UKSPF is expected to reach an annual £1.5bn of investment. Details of this fund are still developing but we anticipate there may be a degree of competition between areas for this funding, as has been the case in other economic development funds launched by this Government. It will therefore be increasingly important to have a robust evidence base to demonstrate the impacts your proposed projects can make and your ability to deliver effectively. Robust evaluation evidence will be critical to underpin the credibility of your bids.
The Government, for their part, have been strong in advocating the importance of high-quality evaluation, and have already issued monitoring and evaluation guidance for the CRF. The guidance for the LUF is expected to follow shortly and is expected to build on existing monitoring and evaluation approaches developed for the Towns Fund. The HM Treasury Green and Magenta Books provide robust guidance around the appraisal and evaluation of policies and programmes at all levels of Government, and it is important that commissioned evaluation work closely follows this core guidance.
For all the frustrations around bureaucracy that many experienced (or are still experiencing) in delivering ERDF and ESF programmes, these funding streams did instil a strong approach to monitoring a set of consistent indicators across projects. They also installed a culture of evaluating every project to ensure lessons were learnt. The downside was that too often those evaluations were undertaken as a tick-box exercise and lessons were not always shared or used to enhance future policy. Combined Authorities and Councils leading on CRF, LUF and other such schemes now have the opportunity to take a more strategic approach and consciously build their evidence base on what works. By using the evidence available to build a strong narrative, local and combined authorities can also make their case more effectively to help secure their share of investment in this new era of economic development funding.
Wavehill is a specialist research and evaluation consultancy - we regularly work with local and combined authorities, local enterprise partnerships, universities and other partners around the evaluation of economic development schemes, including numerous ERDF and ESF projects. We are passionate about the need for clear and robust project evaluation, and the role it can play in building a deeper local understanding of what works to support economic development and levelling up.
If you would like to know more about our work in this area, please contact Stuart Merali-Younger or Oliver Allies