Proposed Decision
To agree the transfer of relevant South East Local Enterprise Partnership (SELEP) responsibilities to Kent County Council from April 2024 including:
• Business representation
• Strategic economic planning
• The delivery of government programmes (where directed)
Reason for Decision
Local Enterprise Partnerships (LEPs) were set up by Government in 2011 as business-led partnerships bringing together the public, private and education sectors to have a central role in determining local economic priorities.
On 4th August 2023, Government confirmed that the functions of LEPs will be delivered by upper tier and combined local authorities in the future. LEP transition guidance confirmed that Government expects LEP functions to be transferred to either a whole county level or functional economic area with a minimum population of 500,000. KCC will therefore need to agree to take on LEP functions on behalf of Kent and Medway. This has been discussed with Medway Council.
Background
Essex County Council (ECC) acts as accountable body for SELEP and looks after many of the back office, legal and HR functions for the organisation. Details in the government guidance about LEP functions to be transferred remain fairly high level but KCC will need to work towards the adoption (or continuation) of the following broad functions:
KCC, Medway Council and the Kent and Medway Economic Partnership (KMEP) will agree the best way forward for key activities formerly delivered by SELEP with a view to implementing the best county-wide solution or continuing certain activities with Essex and East Sussex where there is merit in doing so.
SELEP’s financial reserves will enable funding to be provided to the relevant local authorities (Kent, Essex and East Sussex) to take on members of the SELEP secretariat team to support the implementation of economic growth activities for a period of time (approximately 12-18 months) following the closure of the LEP. In consultation with HR teams, KCC’s Economy Team is working with SELEP on potential arrangements for employing up to four members of staff on a temporary basis.
From April 2024, KCC will also take on responsibility for the future management and monitoring of the Kent & Medway element of SELEP’s capital funding programmes. While this will primarily relate to ensuring the smooth running of existing GBF & LGF projects until their conclusion in 2027-28, KCC anticipates securing a pot of recycled Growing Places Fund capital loan funding that could be run as a new Kent & Medway scheme to provide an evergreen loan fund to support capital investments in the county that contribute to economic growth. It is currently understood that this funding would need to adhere to the original aims set out by government which were to support stalled capital investments by providing interest-free loans. SELEP is currently holding approximately £15m of repaid loan funding that will need to be shared between Kent & Medway, Essex and East Sussex.
Options
The transition of LEP responsibilities to local authorities is mandated by government. The approach that KCC is taking will be to determine with the Kent & Medway Economic Partnership the best options for implementing former LEP activity on a local basis.
How the proposed decision supports Framing Kent’s Future 2022-2026:
LEP transition provides a direct response to the following FKF commitment:
“Work with partners to develop a better co-ordinated approach to economic development across the county, joining up the strengths of the County Council, the Kent Districts and Medway. As part of this, we will explore opportunities with Government to gain control of more of the resources and decision-making that shape economic growth in the county.”
Financial Implications
For KCC, adopting LEP functions will incur revenue costs as much of the activity to be transferred has a staffing requirement. However, there are two sources of external funding that will help support KCC LEP transition activity in the short term:
There is currently not a KCC budget line relating to the financing of SELEP activity. This work will only continue while SELEP reserves and specific government grants are in place to cover these new burdens.
Decision type: Key
Reason Key: Affects more than two Electoral Divisions;
Decision status: Recommendations Approved
Notice of proposed decision first published: 14/09/2023
Decision due: Not before 13th Oct 2023 by Cabinet Member for Economic Development
Reason: Not before the 13th October; To allow the required 28 day notice period under Executive Decision arrangements
Lead member: Cabinet Member for Economic Development
Lead director: Stephanie Holt-Castle
Department: Growth, Environment & Transport
Contact: Steve Samson, Interim Head of Economy 03000 417167 Email: steve.samson@kent.gov.uk.
Consultees
The proposed decision was considered and endorsed at the Growth, Economic Development and Communities Cabinet Committee on 26 September 2023.
Financial implications: Included in the description.
Legal implications: Although the recent government announcement did not list specific Local Authorities who would be expected to take on LEP responsibilities, discussions with civil servants and information provided by SELEP has indicated that KCC will be expected to take on this new role from April 2024. In order to support the practical arrangements of the transition process, a number of legal agreements will be prepared over the coming months involving KCC and ECC’s legal teams including the novation of accountable body funding agreements for capital programmes.
Equalities implications: An EqIA for LEP transition has been developed. It is not anticipated that there will be any negative equalities and diversity impacts resulting from the transition of SELEP responsibilities to KCC. As was the case with SELEP, programmes, activities and policies adopted at a local level will adhere to Public Sector Equality Duty requirements. Data Protection implications Based on an initial screening for the transfer of SELEP activities to KCC, a DPIA is not required. Data sharing agreements will be required between KCC and SELEP (or ECC as accountable body for the LEP) relating to contacts for sector groups, capital projects and partnerships and networks.