Rishi Sunak’s levelling up agenda is beset by an “absolutely astonishing” level of delay, and the government cannot give “any compelling examples” of what it has delivered, parliament’s spending watchdog has found.
The public accounts committee (PAC) said barely any of the 71 “shovel-ready” projects due to be completed this month were on track.
Dame Meg Hillier, the chair of the committee, said: “The levels of delay that our report finds in one of government’s flagship policy platforms is absolutely astonishing.
“The vast majority of levelling up projects that were successful in early rounds of funding are now being delivered late, with further delays likely baked in.”
The report found that only a 10th of the £10.5bn of promised funds had been spent by councils. Just over a third, £3.7bn, had been handed out by Michael Gove’s levelling up department by December.
Hillier said Gove’s department appeared to have been “blinded by optimism” in funding projects that were “clearly anything but ‘shovel-ready’, at the expense of projects that could have made a real difference”.
She said MPs were concerned “and surprised given the generational ambition of this agenda” that there appeared to be no plan to evaluate success in the long term.
Boris Johnson made levelling up the guiding principle of his premiership after winning the 2019 general election on a promise to improve the lives of voters in left-behind parts of the UK.
But the project has floundered under his two No 10 successors and been further derailed by surging inflation and a crisis in local authority funding.
The Conservatives had hoped to go into the next general election able to point to levelling up in action – but the PAC report said the government had been unable to provide “any compelling examples” to date.
The cross-party committee of MPs said it had asked for three examples of projects that had delivered change.
One of the examples given by Gove’s team was the extension of a tram line in the West Midlands. Another was giving some money to a college in Northumberland.
The PAC report said: “We felt the examples the department gave us were, while important to their localities, relatively small scale compared to the substantial and convincing examples we would have expected the department to have readily available at this stage.”
It found that 71 projects granted funding in the first round of bids had been due to spend the money by the end of this month, but that at least 60 had been delayed into the next financial year.
The report said: “We found this astonishing given round 1 of the levelling up fund was awarded to ‘shovel-ready’ projects that were supposed to be completed and delivering for local people by March 2024.”
MPs also criticised Gove’s department for changing the rules for applying for levelling up funds part-way through the bidding process, meaning councils wasted scarce public funds.
They found that 55 councils had spent an average of £30,000 bidding for funds that they could not win because of government rule changes – squandering roughly £1.6m.
Angela Rayner MP, Labour’s shadow levelling up secretary, said: “The Conservatives have utterly abandoned any pretence of trying to achieve their mission to level up Britain.
“This report confirms that the Tories’ begging-bowl approach to funding bids has wasted scarce public resources, forcing local authorities to spend precious time, effort and funds to bid for pots of money, many of which they have no chance of getting.
“Labour will start by ending the sticking-plaster approach peddled by the Conservatives and provide long-term funding settlements to local leaders, giving them greater certainty and the ability to plan for the long-term.”
Henri Murison, chief executive of George Osborne’s Northern Powerhouse Partnership, said: “When this fund was first announced, we raised concerns that the Treasury’s idea for a bidding process would be unnecessarily costly and time-consuming.
“This has proved to be the case, exposing local authorities to high inflation, particularly in construction, which has driven up the cost of projects.”
A spokesperson for the levelling up department said: “We’re proud that we’ve committed £15bn since 2019 to often-overlooked areas, agreeing historic devolution deals, and shifting power and money out of Westminster. This money is regenerating town centres, creating new infrastructure and helping to level up communities across the UK.
“Buildings do not go up overnight and these are multi-year programmes, so it is to be expected that the capital spend ramps up in later years. But we will continue to give expert support to councils to tackle any delivery blockers so we deliver these vital projects quickly.”
