DLUHC perm sec faces further grilling on levelling up funding decisions

Watchdog MPs “disappointed” with Jeremy Pocklington’s stance as £2.1bn in new cash allocations creates fresh controversy
Jeremy Pocklington. Photo: ParliamentTV

By Jim Dunton

19 Jan 2023

Department for Levelling Up, Housing and Communities permanent secretary Jeremy Pocklington has been warned that he faces further questions over the way ministers choose which projects benefit from economic growth funding.

As the government’s latest announcement of levelling up funding allocations created fresh controversy because of the proportion of cash directed towards London and the southeast, MPs said they were still dissatisfied with DLUHC’s processes for approving awards.

In a just-published letter to Pocklington, members of parliament’s Public Accounts Committee said they were “disappointed” with the perm sec’s refusal to accept their recommendation that the principles for awarding funds should be set before shortlisted bidders are revealed to ministers.

In a report last year, MPs said it was “unsatisfactory” that ministers were able to decide on the basis for choosing successful projects only after the identity of candidates for millions of pounds of levelling up funding had been revealed to them.

They said that under the system used for the allocation of the first round of the Levelling Up Fund, ministers had access to evaluation from departmental officials that meant they knew which projects would succeed and which would fail as a result of the principles they set for allocation.

DLUHC rejected the MPs' recommendation. It said ministers needed access to information about where bids are located and “historic investments” directed there to inform their decisions. The department added that the identity of local-authority applicants would be clear even if their names were hidden.

Pocklington is due to appear before PAC next week. In her letter, committee chair Dame Meg Hillier told him to expect further questions about the department’s stance.

“The committee remains of the view that agreeing principles before disclosing shortlists to ministers is entirely compatible with the proper exercise of ministerial discretion within those agreed principles,” she said.

“The risk the committee is addressing here is that of perceived improper ministerial involvement in the decision-making process. This risk could be minimised by following our recommendation.

“The committee will be holding a recall session with the department on 23 January 2023. I would be grateful if you could there provide a fuller explanation of why you concluded that our recommendation was not compatible with proper ministerial decision making.”

Call to end 'Hunger Games-style contests’ for levelling up funds

Today the government revealed the 111 successful projects that will receive financial backing from round two of the Levelling Up Fund – which immediately proved controversial because of cash allocated to projects in areas not perceived as “left behind”.

While schemes such as the Eden Project North in Morcambe and the regeneration of Gateshead Quays received funding worth tens of millions of pounds from the £2.1bn cashpot – £50m and £20m respectively – significant amounts were directed at projects in London and the southeast.

They included £7.7m to improve cycling and walking infrastructure in Camden, £19m to improve public spaces in Hackney, and £9m to make Whitechapel Road in east London more pedestrian and cyclist-friendly.

Levelling up secretary Michael Gove said the successful projects would “revitalise communities that have historically been overlooked but are bursting with potential” in every part of the country.

“This new funding will create jobs, drive economic growth, and help to restore local pride,” he said.

“We are delivering on the people’s priorities, levelling up across the UK to ensure that no matter where you are from, you can go as far as your talents will take you.”

Lisa Nandy, Labour’s shadow levelling up, housing and communities secretary, said her Wigan constituency had recieved a £20m allocation and acknowledged that many of the other allocations would be “very welcome”.

However, she said that the allocations did not make up for local-authority funding cuts imposed in recent years and said the bidding process for funds was costly and created more losers than winners.

“Wigan is a perfect example; they’ve taken £109m from us since Boris Johnson promised to level up the country and they’ve just given us £20m back,” Nandy told Times Radio.

“We’ve spent huge amounts of money going through that competitive-bidding process. Most places have lost: four out of five places have had their bids turned down. Even the winners are losing.  This is no way to make decisions about how to drive local economic growth.

“We need to end the Hunger Games-style contests and get serious about levelling up. It takes an extraordinary arrogance from ministers to think that we should be grateful for a few bits of our own money back.”

Wigan’s £20m Levelling Up Fund allocation will contribute to the restoration of the grade II*-listed Haigh Hall, in combination with around £11m of local-authority match funding. A related project was awarded £4m from the National Lottery Heritage Fund in September last year.

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