Regional Growth Fund (RGF) is a £2.4bn fund that businesses across England can apply to for grants and loans from 2011 to 2015. It supports projects and programmes that lever private sector investment creating economic growth and sustainable employment. It aims particularly to help those areas and communities currently dependent on the public sector to make the transition to sustainable private sector-led growth and prosperity.
The Coalition Agreement committed the Government to “create a fairer and more balanced economy, where we are not so dependent on a narrow range of economic sectors, and where new businesses and economic opportunities are more evenly shared between regions and industries.”
On 29 June, the Deputy Prime Minister launched a £1 billion Regional Growth Fund to provide support for projects that offer significant potential for sustainable economic growth and can create new private sector employment. The fund will particularly help areas and communities currently dependent on the public sector make the transition to private sector-led growth and prosperity.
To help design the Fund, the Government asked the public to provide responses to a number of questions posed in an informal consultation, which was opened on 23 July 2010. The consultation closed on 6 Sep 2010 and the Government response was published on 28 Oct 2010
Key points of the Government’s response are:
- The Regional Growth Fund will be flexible, with bidders able to submit bids either as a project; or a package of projects; or a programme.
- The Regional Growth Fund will not duplicate existing funds, and where appropriate it will align with other funds.
- The Regional Growth Fund will have a minimum bid threshold of £1 million.
- £1.4 billion will be made available through the Regional Growth Fund, over a three year period.
- Guidance will be published that will set the Regional Growth Fund’s criteria and details around Green Book and EU State Aid compliance. The application form will be designed to capture information that satisfies the criteria and requirements.
Regional Growth Fund in the 2011 Autumn Statement
At the 2011 Autumn Statement, the Chancellor announced a further £1 billion for the Regional Growth Fund (RGF), which will be extended into 2014-15. The RGF is now worth £2.4 billion over four years from 2011-12 to 2014-15. It is intended to promote the private sector in areas in England most at risk to public sector cuts.
Announcing the successful bids, Deputy Prime Minister Nick Clegg said:
”I was bowled over by the quality of the bids. This money will now help create and safeguard jobs in some of the communities worst hit by the economic downturn.
“[This] is a step towards rebalancing our economy away from an unhealthy over-reliance on a small number of industries and a few areas. We need to spread opportunity across the whole country, drawing on our many talents.”
Round 1
The Government allocated the first £450 million of funding to 50 bids on 12 April 2011. We have published a full list of successful bids. So far 27 contracts have been signed, giving applicants access to their RGF and 50{3483f31c86e75f31cac7f7389ecca029616bd15227fb3fb90c677a439131696c} of projects have started.
Round 2
The Government allocated a further £950 million of funding to 126 bids in the autumn of 2011 following the second round of bidding. We have published a list of 119 of these bids while the due diligence process proceeds. A full list will be available when contracts are signed. So far 21 contracts have been signed, giving applicants access to their RGF and over 20{3483f31c86e75f31cac7f7389ecca029616bd15227fb3fb90c677a439131696c} of projects have started.
In order for a project to be awarded RGF money, they must successfully complete the RGF process. This process is overseen by an Independent Advisory panel of business leaders and chaired by Lord Heseltine. The Independent Advisory Panel make recommendations to a Ministerial Panel, led by Deputy Prime Minister Nick Clegg, which will make the final decisions as to which bids should receive funding.