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Regional development agencies – while they still exist – will be making a hefty contribution to the chancellor's £6.2bn savings. Sir Harry Studholme defends their corner. If we were in any doubt before, we can now be clear – the future is looking tough. The chancellor's £6.2bn debt reduction package announced last week presents challenges across the public sector, and we know there is more to come. "The future economy will also be driven by emerging technologies and sectors, and provide them with the investment and support they need to compete effectively in global markets." Regional development agencies (RDAs) outside London have been asked to find £270m of savings – roughly 20% of our overall budgets for this year. This will not be easy, particularly as we are already two months into the current financial year, and RDAs will have already committed substantial parts of their budgets. We are not alone, as many organisations, local authorities and businesses are facing difficult decisions at this critical time for the economy. We are determined to work with our partners across the country to make these reductions quickly and efficiently, while still continuing to support hard-pressed businesses, help re-balance the economy, and invest in a low carbon future. We do not yet know which individual projects and areas of RDA work will be affected, but each RDA is likely to have to find a share of the overall reduction in the next few weeks. Unfortunately, we cannot rule out looking to delay or scale back on some projects to which we are already committed. Looking further ahead, the coalition manifesto has stated that the Government plans to replace RDAs with local economic partnerships (LEPs), although it is still not clear how the transition will happen and, indeed, what form LEPs will take. Ministers will want to gain an understanding of the priorities and concerns of local authorities and the business community around future arrangements to drive a private sector recovery within the inevitable context of a smaller public purse. The move to localism is clearly signposted. However, it remains to be seen how it will work in detail, and how some policy functions and capacity might best be managed in this new climate. In the meantime, RDAs are committed to continuing to work hard with our partners to deliver existing and vital investment programmes. Amid all the talk about spending cuts and deficit reduction, there is a need to drive economic growth, which is going to play such an important role in reducing the deficit over the next decade, not to mention ensuring more people get into better jobs and more communities enjoy greater prosperity. Our principal role is to help communities achieve their economic ambitions. We are continuing to work closely with local government to help it shape the economic futures of individual areas. We will continue to help encourage partnerships with the private sector to bring new investment, infrastructure and developments to local areas. With effective local-regional partnership working, we can contribute to fulfilling the ambitions of each locality. We know single regional strategies will not be with us for much longer and funding for regional leaders' boards stops in a matter of weeks, but we believe a close partnership with local authorities is important. We want to build on the good relationships established via the leaders' boards to ensure their dialogue continues on key infrastructure, economic development opportunities and challenges faced in each region. This is as much about a culture of engagement and working together as about a formal set of structures. The new government has many challenges to face, and we await fuller details of how manifesto and coalition pledges develop into detailed policies. We can gear up to help with them to support the Government's ambitions to rebalance our national drive for growth. A low carbon, ‘green' economy looks to be a genuine priority. Delivering government policy and growing a new green technology sector will need commitment, enthusiasm and expertise. It will also take significant private sector investment, and it will be a challenge for the Government at various levels to help ‘de-risk' these vital investment opportunities. The UK has the fifth-highest concentration of the world's top 1,000 international companies for research and development expenditure, and greater business investment in good ideas must be at the heart of a revived and strong economy. The future economy will also be driven by emerging technologies and sectors, and provide them with the investment and support they need to compete effectively in global markets. Both the chancellor and the business secretary have indicated their determination to do everything they can to support a private sector recovery. They want to create the right mix of public and private investment in the infrastructure, the skills, and in the new industries that will drive this future success. I believe strongly that all parts of government should line up behind this concerted effort, to support a new model of economic growth. We all have a vital role to play. Sir Harry Studholme is chair of the South West RDA, and is speaking on behalf of England's RDAs

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WHITEHALL

Why we must keep the RDAs

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