Commons committee says businesses need regional development agencies

Mar 16 2009 by Jonathan Walker, Birmingham Post

A Commons inquiry has warned that businesses need regional development agencies such as Advantage West Midlands – less than a month after Tories announced radical reforms.

The Commons Business and Enterprise Committee, chaired by Worcestershire MP Peter Luff (Con Mid Worcestershire), said there was a “broad and strong consensus” about the need for a regional agency, with business organisations such as the CBI and Federation of Small Businesses warning that they were essential.

Tories announced plans last month to let local councils take over responsibility for economic development and create smaller bodies to carry out the work of regional development agencies, which are responsible for promoting economic growth in regions such as the West Midlands.

Caroline Spelman (Con Meriden), the shadow local government secretary, said at the time: “The Regional Development Agencies will go and their powers will be given to local government. But, if local authorities want to club together and have a development agency, they can take a decision to bring it back.”

The proposal was part of a package of measures to reform local government which also included holding referenda on creating a directly-elected mayor in major cities including Birmingham.

The Business and Enterprise Committee, an independent committee made up of MPs from all parties, has published the results of a five-month inquiry into the effectiveness of the agencies.

Advantage West Midlands spends £291million a year supporting local businesses. But critics point out that the agencies are quangos accountable to ministers in London, rather than directly accountable to local people or councillors.