The Communities Secretary announced on 4 March 2019 a new £1.6 billion ‘Stronger Towns Fund’ for England. The fund aims to build on the success of City Deals, which were agreed in 28 of England’s biggest conurbations, and also hopes to give communities a greater say in their future after Brexit. Whilst it is clear how much each region will be receiving in total, little is known about how that announced Fund will be distributed amongst the various local authorities. The allocation isn't easy, and our analysis shows that different approaches could have very different local consequences.
We’ve come up with few different funding scenarios to demonstrate the impacts:
Option 1 – per capita allocation
Funding is distributed on a per capita basis, which will naturally result in local authorities with higher populations receiving higher overall funding. Under this method, Halton (most vulnerable in NW) would receive £4.9m, whilst Eden (least vulnerable in NW) would receive less than half that amount at £2.0m.
However, this method does not take into account the socio-economic characteristics of the areas which may make places more in need of funding than others.
Option 2 – allocation only to the most vulnerable places
Funding has been allocated per capita but only to areas that rank in the top 40% on our Brexit Vulnerability Index. This results in 25 out of 39 local authorities in the North West receiving funding, whilst the remanding 14 receive none. Using this method Halton would receive £7.02 m whilst Eden would receive zero funding as it does not rank in the top 40% on vulnerability.
Option 3 – allocation based on a weighting according to vulnerability
This approach means that all areas receive funding but each receives a different amount depending on their level of vulnerability. As Halton is the most vulnerable of the areas, it would receive the greatest figure at £14.05m, whilst by contrast Eden which is least vulnerable would receive just £0.36m.
As shown in the bar chart above, the funding level varies quite considerably for Halton under the different options, illustrating that the method of allocation can have significant consequences for any individual area. Option 1 allows all local authorities to benefit from the funding, but funding will be skewed to larger areas, regardless of whether those population live in towns. Under option 2 some local authorities would be at risk of losing out on funding altogether, as seen in the Eden example. Option 3 seems more sensible as every area would benefit but the levels of funding would reflect the scale of the challenge.
The Communities Secretary announced on 4 March 2019 a new £1.6 billion Stronger Towns Fund for England. £1 billion of the new fund will be allocated across the 8 regions using a needs-based formula, with the remaining £600 million being available through a competitive process.
However, it is still unclear how this regional funding will be distributed amongst the various local authorities. Given the wide variation in vulnerability levels across the regions, it is important that different allocations methods are considered.
This brief analysis highlights two important points.
Firstly, careful consideration needs to be given to the metrics and weightings used in allocating the fund. Small changes can have notable impacts. Our view is that careful thought needs to be given to the purpose of the funding, and the outcomes it is seeking to achieve. Only once this is established should the metrics be chosen to allocate it.
Secondly, it is vitally important that local leaders have a strong handle on the dynamics of their places. Regardless of the amount of funding received in a time when resources are constrained and challenges are significant, it is vital that this resource is invested in a way that supports the specific objectives and purpose of the place. If this money is really going to help create strong towns, it will have very different uses across the country.
To find out more about our research and data analysis tools or to pose a research question, speak to us at email@example.com
Previously, we looked at the local implications of the cuts to current EU funding currently allocated to the 39 Local Enterprise Partnerships, and analysed who would have the most to lose after Brexit. In the light of Brexit, our Brexit Vulnerability Index assesses the different factors that are most likely to affect a place's ability to adapt to a post-Brexit world. If you want to find out more about the underlying socio-economic measures and the places we identified as being most vulnerable to Brexit, have a read here. We have also identified a relatively strong negative correlation between the proportion of residents who voted leave in the EU referendum and the Vibrancy of their areas, as measured by our VE index score, read more bout it here.
Place Analytics is an online platform that provides organisations with deep and rapid insight into the performance of individual places and the levers that fundamentally affect it. Through its intuitive user interface and suite of visualisations, benchmarking tools and proprietary algorithms, it transforms data into a clear ‘story of place’ that can be used to underpin strategy and planning with a robust analytical evidence base.
We also work with a wide range of organisations across the public and private sectors to support Brexit preparedness and contingency planning in those times of uncertainty and to enable the capitalisation on opportunities through our Brexit Room services.