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Government selects the first towns to benefit from the £3.6bn Towns Fund

07 November 2019
The Government has published its prospectus for the £3.6bn 'Towns Fund' and revealed it will soon select the strongest proposals for the first round of Town Deals in early 2020. State aid compliance is expected to feature strongly during the selection process.

What is the selection process?

The selection process is expected to align with earlier city deals and growth deals, including the Greater Grimsby Town Deal, and will therefore focus upon whether the proposals submitted are 'credible and deliverable', with particular emphasis on whether State aid compliance has been properly considered. 

In addition to selecting the first towns to receive funding, the Government will also distribute over £16m to enable the Local Government bodies representing the 101 shortlisted towns to develop Town Investment Plans, convene Town Deal Boards, engage with stakeholders and source appropriate expertise. 

What is the Government's Towns Fund?

The Government's 'Towns Fund' is a £3.6bn MHCLG led regeneration fund focusing upon three regeneration priorities within towns in England:

Urban regeneration, planning and land use;
Skills and enterprise infrastructure; and

What towns have been selected?

In September 2019, the Government picked 100 towns (now increased to 101) from across the Northern Powerhouse, Midlands Engine and Oxford-Cambridge Arc to receive funding. Towns selected include Workington, Hastings, Glastonbury, Dudley, Redcar, Goole, Birkenhead, Bishop Auckland, Great Yarmouth, Burton upon Trent, St Ives, Margate, Darwen, St Helens and Blyth. 

What types of projects will be funded?

Types of projects, which may be funded, include infrastructure investment to remove growth constraints, skills training to help local economies diversify, investment to deliver greater transport connectivity and improvements to digital connections. 

In addition to identifying the first round of towns to receive public funding awards of up to £25m, the Government will also provide £16.4m of capacity funding for local authorities through awards made under Section 31 of the Local Government Act 2003. This funding is intended to improve the development of bids by providing support to engage with stakeholders, draft business cases and pay for external technical expertise. 

Will the private sector play a role?

Launching this next round of the Towns Fund, Minister for the Northern Powerhouse, Jake Berry MP was keen to emphasise that the Towns Fund involves "giving local people the money and power to decide what is best for their town", part of his long term vision to devolve decision making from Whitehall to local communities. Local Government Secretary Robert Jenrick MP was keen to focus on the role that the private sector can play in leading Town Deal Boards, stating "the private sector has an integral role to play in making these Town Deals a success". 

Will the general election have any impact?

The announcement comes on the eve of an election campaign, which according to a study by the Resolution Foundation (and reported by the BBC News) is likely to take Government spending towards levels not seen since the 1970s, whichever party wins the general election. Although Manifestos have yet to be published, in recent months the Conservatives have proposed a £100 billion 'National Infrastructure Fund' whereas the Labour Party has proposed a £250 billion 'National Transformation Fund'.  Given this move towards much greater investment, following a period of unprecedented austerity, the public sector should be identifying both opportunities for both regeneration and commercialisation. 

Need more information?

Our expert team at DWF has a breadth of expertise in public funding matters. We are able to draw upon a team of leading experts who have extensive experience in this area, including working within the UK Government on Northern Powerhouse, Midlands Engine and the Oxford – Cambridge Arc initiatives and many public funding programmes such as Local Growth Fund, ERDF and the Coastal Communities Fund.  Contact one of our team if you need any further information or need specific advice.


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