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‘Urgent reform’ needed around local devolution business engagement

Over two-thirds (70%) of small firms in England support devolution, but more transparency is needed if further deals are to be beneficial for local economies.

This is one of the findings from a survey by the Federation of Small Businesses (FSB), which asked its members for their views on devolution.  

Around 64% of respondents said they thought that devolution deals were good for individual businesses.

But many raised concerns about their ability to have a say on local devolution, as only 17% felt they had been sufficiently consulted on devolution in their area – whilst a whopping 57% said they felt they could not contribute to ongoing decision-making in local authorities.

“The success of devolution deals will hinge on effective collaboration between new and existing local leaders,” said Mike Cherry, FSB’s national chairman. “Transparency is key. Combined authorities must clearly demonstrate how they are promoting growth and establish channels through which they can be held accountable.

“No doubt they’ll be heeding the NAO’s warning about becoming ‘a curiosity of history’. With new devolution proposals in the pipeline, future deals must be established on the basis of need. What we can’t have is the political affiliations of negotiators playing any role in fresh agreements.”

Cherry also said that it was encouraging to see the new mayors are already engaging with small businesses in some areas, as a number had already established business advisory groups – something that mayors in other areas were urged to replicate.

But the FSB lead argued that reform was nevertheless “urgently needed” to ensure businesses can benefit fully from future devolution deals, with LEPs also needing to be properly equipped to maintain their vital business support services beyond Brexit.

“All LEPs are obliged to have a small business champion in place and that obligation needs to be met right across the country,” Cherry continued. “Equally, the government should produce comprehensive business data, including unregistered businesses, at a LEP level so partnerships can tailor local growth strategies effectively.  

“LEPs need to be beyond reproach in terms of their governance, overall transparency and representativeness. They should be channels for economic growth and targeted business support, not old boys’ clubs.”  

Top Image: Adam Tinworth

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