Headlines: February 24th, 2006

Ten projects proposed by fifteen councils have been given a share of the 126 million pounds funding from the Local Enterprise Growth Initiative to boost the economies of some of the deprived areas in England. But none of the most
deprived areas, as measured on the Index of Deprivation, were successful in the bidding process. The Institute for Public Policy Research’s Centre for Cities believes that the bidding process is flawed, with success going to
those councils with the skills to put together the best bids. This is shown in Greater London, where the bidding process resulted in Croydon, with a score on 2 in the Deprivation Index winning, while Tower Hamlets which
scores 6, was unsuccessful.

The quality of the unsuccessful bids also appears to be the reason why 50 million pounds earmarked for 2006-2007 has not been allocated.

The Local Enterprise Growth Initiative is a joint programme between the Office of the Deputy Prime Minister, HM Treasury and the Department for Trade and Industry. It is a neighbourhood renewal programme that aims to
increase entrepreneurial activity in the local population; support the growth and reduce the failure rate of locally-owned businesses; and attract inward investment and franchising, making use of local labour resources. The
aim is to encourage a step-change in economic activity in some of the most deprived areas in England.

Some 90 councils with high levels of deprivation are eligible to take part in the programme and they will be asked to bid again in the summer for the next funding round.

The Centre for Cities is researching barriers to enterprise in deprived areas and its report, City Markets, will be published in late Spring 2006.