Private firms lose out in race for RDA grants

CLAIMS that regional development agencies (RDAs) are there to help private businesses were exposed as false yesterday, after it emerged 62 per cent of grants were funnelled back into the public sector.

Research from the Taxpayers’ Alliance shows public sector organisations and projects received £1.8bn in grants between 2007-09 out of a total of £2.9bn.

Trade unions – which donated almost £10m to the cash-strapped Labour party last year – were among the biggest beneficiaries, receiving over £3m in grants in the two-year period.

According to the figures, which were only released following a Freedom of Information request, the Trades Union Congress walked away with a staggering £2.6m in RDA grants.

The Liberal-Conservative coalition had promised to scrap the hugely expensive quangos, although business secretary Vince Cable has since said he will keep those that are popular with local businesses.

If the government were to scrap all of the RDAs, it could afford to cut the rate of small business corporation tax by 3.7 per cent, the Taxpayers’ Alliance said.