11.09.12
‘Scandalous’ failure of Regional Growth Fund to distribute funds – PAC
One of the Government’s main initiatives to create jobs has been criticised for its slow progress so far. A new report from the Public Accounts Committee (PAC) found that so far, only £60m of the £1.4bn Regional Growth Fund has been released.
According to the report, some £374m spent so far has been held up in intermediaries like banks and local authorities.
The fund was expected to create 36,800 jobs over the lifetime of the project, but only 2,442 jobs have been created and 2,762 existing posts protected since it launched two years ago.
Value for money in the fund was also criticised after it emerged that some posts have cost over £200,000 to create.
Margaret Hodge, the PAC chairman, said: “Given the dire state of the economy, it is scandalous that so few projects funded by the Regional Growth Fund have got off the ground. It is unclear what is being done to make sure that money is not wasted but spent on creating real jobs.”
But Michael Fallon, the new business minister, said: “The fund is delivering at the pace that companies can expand and create new jobs. To rush companies into expanding before they are ready would be unsustainable and would put public money at risk.”
The report is at: www.publications.parliament.uk/pa/cm201213/cmselect/cmpubacc/104/10402.htm
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