Regional Growth Fund (Update)

Monday 11th February 2013 Written Statements

[The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)]

In my written ministerial statement of 17 January 2013, Official Report, column 41WS, I announced that Ministers reserve the option to award Regional Growth Fund (RGF) support flexibly. This allows us to respond quickly to specific economic opportunities or shocks in order to ensure that we do everything that we can to maximise growth in the most vulnerable parts of the country. This will be in exceptional circumstances only and will take place outside the normal bidding process, although detailed due diligence requirements will still need to be met.

Part of the Government role in their commitment to growth is to discuss investment opportunities with private sector organisations and local bodies. Where a proposal for securing investment, and associated employment opportunities aligns with the principles of the RGF and there is no routine chance to bid—either because no bidding round is open or because an investment decision is needed imminently—RGF support can and should be possible, to realise those growth opportunities.

Exceptional RGF (eRGF) will therefore be considered by Ministers as a way to support credible proposals for growth by allowing RGF money to be awarded at any appropriate time. In this way, we continue in our aim to rebalance the economy and support business growth.

One of the strengths of the RGF to date has been its competitive nature. In the absence of an open competition, eRGF cases will be benchmarked against similar bids from previous rounds to assess their relative value for money. In each case Ministers will also seek independent advice before approving eRGF support.

Exceptional RGF funds will be met from existing budgets by recycling money from previous RGF rounds where bidders have withdrawn or reduced their grant amount. In this way, we ensure that RGF funds continue to be spent on RGF objectives, to enable investment, support growth and create jobs.

As with RGF, those organisations that are awarded eRGF support will be published on the Government website (https://www.gov.uk/understanding-the-regional-growth-fund) where further information on eRGF is also now available.

Withdrawn projects

A number of bidders have withdrawn since I last published the list in September. The withdrawal of a small proportion of bids is to be expected given the robustness of the contracting process.

Bidders may withdraw a project or programme for any reason. Commonly these include global market conditions; realisation through the due diligence process that the project could not be supported (including on state aid grounds); and changes in senior management or parent company strategy.

The up to date list of withdrawn bids is below.