Regional Development Agencies (RDAs), the government bodies which work with local businesses to promote economic growth, will be scrapped as part of George Osborne’s austerity Budget.
Nine schemes, covering each of England’s regions, got the chop through the public bodies bill yesterday as the new chancellor slashed fat from government spending.
The coalition has pledged a white paper later this summer to lay out the proposals.
Cameron’s government vowed to support local business through the creation of local enterprise partnerships which will “enable improved coordination of public and private investment in transport, housing, skills, regeneration and other areas of development.”
The coalition could also give local authorities powers to offer reduced business rates and control council tax levels to encourage growth.
Osborne also pledged to simplify the planning consent process in areas where there is likely to be significant business growth.
The news will be a hammer blow to RDAs which hoped their positive track-record could save their skins.
Independent research by PricewaterhouseCoopers estimated that for every £1 invested by RDAs, they generated £4.50 in return, rising to £6.40 when future returns are included.