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The Institute of Economic Development (IED) has launched a “radical agenda for change in the run-up to the likely 2024 General Election”, as it steps up its work for councils to be given statutory powers over economic development.

In his opening speech at the IED Annual Conference in Birmingham, IED Chair and Chief Executive of Salford City Council Tom Stannard presented the Institute’s overarching call for economic development to be formally recognised as a statutory function provided by local authorities in Grow Local, Grow National, and a series of recommendations, sitting within six supporting pillars, which are deemed “critical for success”. 

“With the Government confirming its intention to transfer LEPs to local government from April 2024, the pivotal economic role of councils for realising the country’s growth ambitions has been articulated,” Tom said at the IED’s 40^th anniversary conference, titled Grow for Good? Reappraising the UK's Growth Objectives, today.

“Giving local authorities a legal duty over economic development would create a clear accountability structure, which in turn would make it simpler and more attractive to UK and international firms and financial institutions to invest in places. It would also enable the development of local strategic economic development plans that respond to the views of local businesses, as well as the wider community.

“After launching with Solace a joint call for councils to be given statutory powers over economic development so that they can more effectively help create high-quality jobs, attract investment into local areas, and turbocharge the UK plc, our manifesto for change seeks to move this discussion on and we welcome a dialogue with Government on establishing the economic development duty early in the next Parliament.”

The six supporting pillars in the manifesto are:

1. Devolution

As increasing local devolution moves up the political agenda, and LEP core functions are transferred, it will be essential for local authorities to have in place the models to ensure that local evidence can be gained, effective policies developed and implementation delivered. 

We ask for:

• A national economic/industrial strategy which sets the agenda for the UK over a five-year period. This could build on the previous Industrial Strategy and the Levelling Up White Paper.
• The IED to have a representative seat on the revamped National Industrial Strategy Council.
• A requirement for local authorities to develop an accountable five-year economic strategy/strategic economic plan – led by upper tier authorities but taking into account function economic areas, supported by capacity funding.
• All economic strategies to specifically and consistently focus on fair employment, productivity, access for all, sustainability and satisfaction for residents.
• A single settlement funding pot approach built on “trailblazer” devolution deals.
• A multi-year settlement approach, rather than annual spending reviews.

2.  Funding and Pipeline Stability

Underpinning all economic development and associated projects is a requirement for a more stable and long-term funding landscape.

We ask for:

• An end to the micro competition for capital funding as part of the single settlement funding pot approach, with any funding settlement with government and wider government programmes, such as UKSPF, operating over a longer timeframe and coinciding with a five-year economic strategy horizon.

3. Net Zero

The IED fully supports the mission of the Blueprint Coalition’s Manifesto for Local Climate Action, a core part being recognition of the need for a place-based approach to tackle climate change and move towards net zero.

We ask for:

• Support for place-based climate action backed by adequate funding and support from national government; commitment to a cross-government department partnership approach with local authorities; commitment to reform and devolve funding streams and embedding climate action in devolution deals.
• An expansion of a net zero neighbourhood approach, led by local government.
• Transition funding to enable viability gaps on local net zero schemes to be better overcome.