Leigh: Red tape fears

The Commons public accounts committee has issued a damning verdict on the way the government has established its flagship regional development agencies.

Nine RDAs were set up to promote economic development and regeneration across England, and have been a key policy of John Prescott's Office of the Deputy Prime Minister.

But in a report published on Tuesday, the MPs said that the bodies were left to "tangle with the bureaucracy of overly complicated funding and delays in decisions".

Funding for the bodies comes from five different government departments as well as the UK Trade and Investment body.

While the funding, which will reach £2.3 billion by 2007/08, comes from the ODPM, the bodies are officially overseen by the DTI.

Prescott's department should explain the different responsibilities of RDAs and departments, said the report.

And the DTI should "specify which organisations are empowered to decide when there are disagreements among local, regional and national bodies".

"Local authorities have on occasions received the impression that previous funding decisions might be overturned if regional bodies and national bodies disagree," warned the report.

"Such lack of clarity strains relationships between organisations that need to work together."

Poor relationships

Committee chairman Edward Leigh said the agencies "were hampered in their early years by poor relationships with the government departments that fund and oversee their important work".

"I am very disappointed that RDAs have had to tangle with the bureaucracy of overly complicated funding and delays in decisions," he added.

"They have been given too little freedom to respond to regional priorities, and have had too little influence over spending on skills and transport which are so vital to regional development."

Targets developed by the DTI with the RDAs "led to conflicts between regional priorities and national policies", said the report.

And the targets "concentrate too much on short-term contributions to Whitehall objectives and too little on longer-term regional impact."

Leigh added RDAs should be "given the breathing space they need to address local needs".

"It has taken central government too long to recognise the problems," he said.

"ODPM should do more to streamline the funding sources available, cut unnecessary red tape, and determine the respective responsibilities of the various players at regional and national level."