Do we need LEPs after all?

With government funding for skills advisory panels ending and the future of local enterprise partnerships (LEPs) hanging in the balance, the landscape for regional skills oversight is shifting. Jason Noble assesses the impact if both are lost for good.

For the last decade, local enterprise partnerships have been at the forefront of local and regional economic development across England.

Launched in the early 2010s to replace regional development agencies, LEPs were designed to take responsibility for local growth and play a role between central government and local businesses.

But with devolution deals promised for every region in England that wants one by 2030, and the government in the spring budget indicating that it was “minded to withdraw central government support for LEPs from April 2024”, is it already over for LEPs?

It would appear the writing has been on the wall for some time. LEPs were frozen out of bidding to become employer representative bodies for the new local skills improvement plans (LSIPs) being developed across England, although it should be noted that mayoral combined authorities were also curbed from taking control of those too.

And this month, the Department for Education published the final funding allocations for skills advisory panels – groups bringing together employers, providers and other key stakeholders, many of which are led by LEPs, to gather local data and evidence to inform local skills policies.

The DfE has confirmed there will be no further funding of SAPs, with the 2022/23 cash set at £55,000 for each of the 34 areas – £20,000 less than the £75,000 the year prior.

The DfE said the reduced allocation reflected the smaller ask of SAPs from previous years.

A spokesperson said: “We want to ensure that we are putting employers at the heart of local skills systems to help people to develop the skills they need to get good jobs and increase prospects.

“That’s why we are rolling out the employer-led local skills improvement plans (LSIPs) across the country, which the skills advisory panels supported in development by sharing analysis and data of the local skills system.”

The SAPs could still exist within the new employer representative bodies forming the LSIPs, but that will be down to the individual areas and will not attract any more central government funding, the DfE said.

The Levelling Up, Housing and Communities department told FE Week: “Our intention is for the functions of local enterprise partnerships to be delivered by democratically elected local leaders, where this is appropriate and is not already delivered by combined authorities.”

A consultation on the future of LEPs is currently underway – the 38 LEPs are in a four week window to complete a questionnaire that evidences where they add value, with next steps likely to be unveiled in the summer.

But what will the potential loss of LEPs and SAPs mean for local skills functions? Mark Livesey, chief executive of the LEP Network which champions the 38 LEPs across the country, is unequivocal.

“You won’t miss the benefits until they’re gone because LEPs play such an integral role in local skills provision – they’ve worked hard to build local partnerships between local business and providers,” he said.

“Local authorities simply don’t have that scale of business contact and the deep understanding of local labour markets which LEPs have built up over the last decade.”

He described it as a “retrograde step at a critical point,” pointing out that as apolitical bodies, LEPs did not have the same political wrangling which elected authorities faced.

Nationwide, LEPs have secured more than 3,500 business professionals in volunteering as enterprise advisors in schools to deliver careers sessions for the Careers and Enterprise Company.

Many help facilitate apprenticeship levy transfers from larger to smaller employers, and have a key seat on SAPs which have generated some of the evidence that has informed LSIPs.

Furthermore, many are involved in key government programmes such as Kickstart, Restart and skills bootcamps, and have been involved in dishing out investment funds locally.

Indeed, bootcamps is one area where the LEPs say they could add more value.

Chris Starkie, chief executive of the New Anglia LEP covering Norfolk and Suffolk, said the LEP significantly exceeded its wave 3 bootcamps target of 240 by achieving 310 learners, and could deliver twice as many learners this year had it been given the funding to do so.

It bid for £2.7 million for wave 4 bootcamps, but was given just £1.4 million.

He pointed out that some mayoral combined authorities struggled to hit their targets but received much larger allocations – at a time when the chancellor said he wants to drive up bootcamp starts with ambitions of another 8,000 bootcamp places in 2024/25 announced in the budget.

“We are just disappointed that while some parts of the country are struggling to get learners and struggling to get providers, we have just completed a procurement process where we will have to turn away providers and turn away learners because our settlement is much lower than MCA areas,” Starkie said.

Starkie says that LEPs have given further education providers “a real stake in local economic development – with an influential role in the work of LEPs, including seats on LEP boards”.

For Clare Hayward, chief executive of the Cheshire and Warrington LEP, the convening powers of LEPs are among the most important – and will be key to skills provision in the future, not just for the present.

Hayward said: “There isn’t really anybody else that plays that collaborative, catalytic role in bringing all of those voices together when it comes to skills.

“You might be able to understand what our current landscape is by using data and evidence, but also because we have those relationships with our businesses and business representative organisations, we can say what are the future skills.”

A push for business involvement in post-16 education has been clear for some time: Ofsted now measures colleges for their contribution to skills needs, and the watchdog often comments on how much apprenticeship providers work with firms to design their curriculum.

LSIPs add to this by bringing employers into wider local and regional planning and not just individual courses.

Ewart Keep, emeritus professor at Oxford University’s department of education, said that the new LSIPs will need to develop further still.

“The model seems to be employers sit down with chambers of commerce and write a letter to Santa saying ‘these are the skills I need from local colleges and providers,’” he said.

“If this model is going to have any long-term impact employers need to go on to a second stage – ‘this is what we the employers can contribute to the development of those skills’. You move from a wish list to co-production and employers accepting a greater responsibility.”

LEPs are understandably keen to shout about their work but local authorities will feel they can perform just as well.

A spokesperson from the Local Government Association said that the chancellor’s plans to transfer responsibilities from LEPs to local authorities by April 2024 “provides a helpful timeline for councils and combined authorities”.

But it warned that “this needs to be supported by a commitment from government that transfers of responsibility are matched by sufficient funding and a commitment to work with the sector to identify any capacity issues some areas may face”.

Hayward concluded: “There is a realism that structures are changing, the writing has been on the wall for a little while now. What’s really important is that we don’t lose some of the business voice, the independent voice, the strategic voice in the shift and the restructure. It may not be called a LEP but actually what is required is the capabilities and the skills of a LEP to be able to deliver.”