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Local government must lead local growth – Solace

Local government must take the lead in shaping local economies to ensure growth is delivered sustainably, a new report from Solace (the Society of Local Authority Chief Executives and Senior Managers) has revealed. 

One of its key recommendations was that whilst accepting valuable contributions from Local Enterprise Partnerships (LEPs) and central government, there must be a focus on local government spearheading local growth. 

In the report – Local Roots to Growth – it was revealed that 70% of chief executives and senior managers believe that local growth schemes are either “effective” or “very effective”, compared to 27% feeling that national schemes have been effective. 

Solace’s research also stressed that local authorities should be granted greater freedom of borrowing to invest particularly in infrastructure and skills. Around three-quarters of Solace’s membership believes that these are the two most important areas for investment. 

However, to achieve this, it has been advised that central government gives councils greater control over the finances of tax and spend through the development of local treasuries. “Local government has proven competent and effective in financial management, and must be trusted to deliver what is best for the local people,” states the report. 

Graeme McDonald, Solace director and a member of PSE’s editorial board, added: “Local areas are moving with real purpose in developing growth strategies. Councils are in the driving seat, but there is a risk that central government apply the handbrake to ambitious local growth initiatives.” 

The report argues that effective integration is vital: skills must be developed with local businesses, support must be granted across sectors and infrastructure must be invested in to let businesses see the value of local economies. 

It was also recommended that central government should proceed “at pace” to clarify the geographical discrepancies between LEP boundaries and functional economic areas (FEAs); as this is widely seen as one of the greatest barriers to LEPs facilitating growth. 

Finally, three-quarters of Solace members also believe economic growth is the most critical area to focus on in their local area over the next five years. 

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