Recommendations & Conclusions
19 items
4
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
As a starting principle, local authorities who most require prioritising within the Levelling Up policy should be allocated money through revenue to achieve objectives that are in line with their local circumstances and need, with the appropriate monitoring and expenditure in place. Local authorities must be given the flexibility to …
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As a starting principle, local authorities who most require prioritising within the Levelling Up policy should be allocated money through revenue to achieve objectives that are in line with their local circumstances and need, with the appropriate monitoring and expenditure in place. Local authorities must be given the flexibility to use allocated funds in the most effective way they can. Therefore, we recommend there is a change in approach across Government when it comes to funding for levelling up. The Department should move away from an overemphasis on bid and judgement- based funding pots which may impede effective local decision-making. (Paragraph 19) Competitive Funding
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Government response AI summary
The government highlights its published plan for simplifying the funding landscape and its commitment to launch a Funding Simplification Doctrine in 2024, which will encourage allocative approaches over competitive bids where suitable. It cites the UKSPF as a non-competitive fund with a mix of revenue …
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Ministry of Housing, Communities and Local Government
5
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
The Levelling Up White Paper committed the Department to simplify funding streams and reducing the requirements to access competitive bidding. Despite this, we have seen limited evidence that any progress has been made on these objectives to date. Furthermore, the evidence we received on competitive funding has indicated the challenges …
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The Levelling Up White Paper committed the Department to simplify funding streams and reducing the requirements to access competitive bidding. Despite this, we have seen limited evidence that any progress has been made on these objectives to date. Furthermore, the evidence we received on competitive funding has indicated the challenges are far greater than those outlined in the White Paper.
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Government response AI summary
The government states it published a plan on 4 July 2023 for simplifying funding and will launch a Funding Simplification Doctrine in 2024 to guide appropriate distribution methodologies. It also highlights the UK Shared Prosperity Fund which provides formula-based allocation rather than competitive bidding.
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Ministry of Housing, Communities and Local Government
6
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
It was made clear by our witnesses that competitive bidding is a resource intensive and costly activity. This can create barriers for stakeholders and communities in need of funding. Whilst limited funding was provided for some local authorities in the Funding for Levelling Up 37 Levelling Up Fund round one …
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It was made clear by our witnesses that competitive bidding is a resource intensive and costly activity. This can create barriers for stakeholders and communities in need of funding. Whilst limited funding was provided for some local authorities in the Funding for Levelling Up 37 Levelling Up Fund round one to assist with bidding costs, challenges remain. These include, but are not limited to, additional costs associated with planning, hiring consultants and costs associated with diverting employee time away from core tasks to put together bids. This is in addition to the financial strain already felt across local authorities. We have also heard that the competitive process is better suited to larger local government bodies with more ready access to resources which can create an uneven playing field. The evidence shows that those who are successful in bidding have a greater chance of success in subsequent rounds or other competitive bidding processes.
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Government response AI summary
The government outlines its plan for simplifying the funding landscape, published on 4 July 2023, and commits to launching a Funding Simplification Doctrine in 2024. This doctrine will assess the most suitable distribution methodology, encouraging allocative approaches where appropriate to minimize demands on local authorities.
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Ministry of Housing, Communities and Local Government
8
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
We heard evidence which brought into question the extent of support provided to applicants or unsuccessful applicants by DLUHC. There is a wide gap in perception between the quality of feedback the DLUHC said it had provided and the quality of feedback applicants said they had received. DLUHC does not …
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We heard evidence which brought into question the extent of support provided to applicants or unsuccessful applicants by DLUHC. There is a wide gap in perception between the quality of feedback the DLUHC said it had provided and the quality of feedback applicants said they had received. DLUHC does not appear to have a department-wide process which allows for a consistent approach to delivering feedback.
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Government response AI summary
The government confirms it provided feedback to unsuccessful applicants in both rounds, improving the process in round two by providing detailed written feedback based on lessons learned from round one. They note receiving positive feedback on the round two process.
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Ministry of Housing, Communities and Local Government
11
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
The nature of competitive bidding can result in resentment between communities and similar neighbouring authorities across the country. Communities and local 38 Funding for Levelling Up authorities should be encouraged to work together, and the Government should be mindful of any adverse effects caused by competitive bidding. It is important …
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The nature of competitive bidding can result in resentment between communities and similar neighbouring authorities across the country. Communities and local 38 Funding for Levelling Up authorities should be encouraged to work together, and the Government should be mindful of any adverse effects caused by competitive bidding. It is important that competitive bidding does not pit communities or local authorities against one another for finite resources.
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Government response AI summary
The government acknowledges the administrative burden of competitive bidding and states the upcoming funding simplification doctrine will balance its approach. It commits to working with local authorities to ensure fair and transparent distribution of competitive funding and to encouraging collaboration, citing existing capacity grants and …
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Ministry of Housing, Communities and Local Government
13
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
Throughout all future competitive bidding processes, the Government must avoid introducing additional metrics for success once an application process has closed. If, for any reason, this becomes unavoidable, the DLUHC must communicate this change via official and public channels of communication before successful applicants are announced. Throughout any funding programme …
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Throughout all future competitive bidding processes, the Government must avoid introducing additional metrics for success once an application process has closed. If, for any reason, this becomes unavoidable, the DLUHC must communicate this change via official and public channels of communication before successful applicants are announced. Throughout any funding programme the Government must also ensure that they are able to adapt and respond to the possible impact of inflation through adequate financial support for successful projects.
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Government response AI summary
The government refutes the claim of introducing new metrics, stating its decision-making framework was published at the outset. It adds that it has provided £65 million in additional funding to support local authorities with project development, including adapting to inflation impacts.
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Ministry of Housing, Communities and Local Government
17
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
The DLUHC should not seek to fix something which is not broken. Rather than outsourcing the collection of new data sets, the Department should have called on the expertise of bodies such as the Local Government Association and offices within local government which have ample access to data on deprivation …
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The DLUHC should not seek to fix something which is not broken. Rather than outsourcing the collection of new data sets, the Department should have called on the expertise of bodies such as the Local Government Association and offices within local government which have ample access to data on deprivation and measuring need and understand their local areas and communities best. This would have ensured that time and money was not spent on reframing and accessing data which has, most likely, already been collated elsewhere. Furthermore, the data and data sources the DLUHC chooses to use to determine the parameters for funds, such as the Levelling Up Fund, should always be clear and accessible. It is still not always clear what data sets the DLUHC is using. We suggest that transparent data collection processes and calling on the support of local government would have prevented the perverse situation of deprived areas such as Barnsley Metropolitan Borough Council missing out from the first round of funding.
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Government response AI summary
The government defends its data collection approach, explaining that its chosen indicators align with Levelling Up Fund interventions and that data sources are primarily government statistical releases, with links provided in published methodology notes. It states it chose to gather data from original sources rather …
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Ministry of Housing, Communities and Local Government
18
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
We are concerned about the DLUHC’s lack of sufficient data on all aspects relating to levelling up. The Department has acknowledged that it lacks data of sufficient quality about Government department’s expenditure on the full range of levelling up funds. It also lacks data on combined authority income and expenditure. …
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We are concerned about the DLUHC’s lack of sufficient data on all aspects relating to levelling up. The Department has acknowledged that it lacks data of sufficient quality about Government department’s expenditure on the full range of levelling up funds. It also lacks data on combined authority income and expenditure. This raises the question about how the DLUHC measures success or failure in the levelling up policy, its initiatives and objectives. Taking the publication of the White Paper as a starting point, the levelling up policy has been live for over a year, and the ongoing absence of adequate data raises significant concerns about how the DLUHC can realistically take credible data-driven decisions within this policy. It further raises questions about the DLUHC’S future ability to determine whether its policy is a success.
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Government response AI summary
The government acknowledges data concerns but states good progress is being made on metrics, with new data publicly available. They also note the Levelling Up and Regeneration Bill will require annual reports and DLUHC is working to publish subnational expenditure data, with an annual report …
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Ministry of Housing, Communities and Local Government
19
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
One of our core tasks is to monitor the policy of the DLUHC and without sufficient data we are limited in our ability to do so. We are concerned that the lack of accessible data was not foreseen or resolved in a timely manner. As the DLUHC noted themselves that …
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One of our core tasks is to monitor the policy of the DLUHC and without sufficient data we are limited in our ability to do so. We are concerned that the lack of accessible data was not foreseen or resolved in a timely manner. As the DLUHC noted themselves that there is not “sufficient data” we recommend DLUHC remedy this problem as quickly as possible. Therefore, the Department must produce and make publicly available the data on departmental expenditure and data on combined authority income and expenditure so that our committee, local government, and communities are able to access and monitor the policy’s progress.
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Government response AI summary
The government outlines ongoing efforts to make data publicly available, including through the Subnational Indicators Explorer and a subnational expenditure project. It also states that an Annual Report on Devolution will be published by March 2024, and the Levelling Up and Regeneration Bill will mandate …
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Ministry of Housing, Communities and Local Government
20
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
The DLUHC’s solution to its lack of data appears to have been the creation of the ‘Spatial Data Unit’ (SDU). The SDU was set up over a year ago and since then we have sought to understand the work of this unit and their forward plan. However, it remains unclear …
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The DLUHC’s solution to its lack of data appears to have been the creation of the ‘Spatial Data Unit’ (SDU). The SDU was set up over a year ago and since then we have sought to understand the work of this unit and their forward plan. However, it remains unclear what data will be produced and by when.
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Government response AI summary
The government clarifies that the Spatial Data Unit (SDU) is transforming data use for place-based decision-making and is already producing granular data, such as LSOA Gross Value Added (GVA) and improved R&D expenditure estimates. The SDU is also supporting the Subnational Indicators Explorer, which is …
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Ministry of Housing, Communities and Local Government
21
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
The delay and lack of information regarding what the SDU is working on, what the Unit intends to produce and when these data sets will be available, is unsatisfactory. The DLUHC, via the SDU, must make clear at the start of every year what data it is planning to produce …
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The delay and lack of information regarding what the SDU is working on, what the Unit intends to produce and when these data sets will be available, is unsatisfactory. The DLUHC, via the SDU, must make clear at the start of every year what data it is planning to produce and when this information will be made available. At present, in the absence of clear information about the intended outputs, we cannot see how the SDU is a good use of public resources. Levelling up requires a long-term strategy, with long term funding plan, backed by data. This is currently not being demonstrated. (Paragraph 68) 40 Funding for Levelling Up
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Government response AI summary
The government outlines the Spatial Data Unit's (SDU) ongoing work to transform data use, including subnational expenditure projects, partnerships with the ONS for local statistics, and the development of public tools like the Subnational Indicators Explorer, updated quarterly. It highlights various published data outputs and …
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Ministry of Housing, Communities and Local Government
22
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
According to the Financial Times, concerns about the DLUHC’s ability to deliver ‘value for money’ have been raised by the Treasury. Despite DLUHC’s efforts to reassure us, the Treasury’s decision to remove DLUHC’s ability to sign off on capital expenditure is a significant concern. The DHLUC needs to make clear …
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According to the Financial Times, concerns about the DLUHC’s ability to deliver ‘value for money’ have been raised by the Treasury. Despite DLUHC’s efforts to reassure us, the Treasury’s decision to remove DLUHC’s ability to sign off on capital expenditure is a significant concern. The DHLUC needs to make clear what impact this will have on the delivery of future DLUHC funded projects and in particular future funding under the levelling up policy. (Paragraph 69) The UK Shared Prosperity Fund
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Government response AI summary
The government clarifies that the change in capital expenditure sign-off only relates to new projects and has no implications for DLUHC's budgets, policy objectives, or the delivery of Levelling Up. They cite recent funding announcements as evidence of continued investment.
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Ministry of Housing, Communities and Local Government
27
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
The DLUHC has told us that it consulted with the Devolved Governments on the creation, compatibility, and implementation of the levelling up funds. However, we have heard from the Scottish and Welsh Governments, and officials from the Northern Ireland Executive, that they have not been satisfied with the level of …
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The DLUHC has told us that it consulted with the Devolved Governments on the creation, compatibility, and implementation of the levelling up funds. However, we have heard from the Scottish and Welsh Governments, and officials from the Northern Ireland Executive, that they have not been satisfied with the level of consultation they have had with the Department. Based on the concerns and challenges that have been presented to us in relation to funding for levelling up by the Devolved Governments, we can only conclude that the consultation has for all involved. If the Department had taken a more detailed and comprehensive approach before and during their consultation, while taking on board concerns raised by the Devolved Governments, we believe it would have been able to avoid some of the challenges and criticisms it has encountered.
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Government response AI summary
The government acknowledges shared goals with devolved administrations and outlines its existing close working relationship and consultation efforts across various levelling up initiatives, including joint Freeports, seeking advice on the Levelling Up Fund, and engaging on UKSPF interventions.
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Ministry of Housing, Communities and Local Government
28
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
We have also heard from the Scottish and Welsh Governments, and officials from the Northern Ireland Executive, that levelling up funding was not always compatible with devolved policy and that the method of distribution was not appropriate. The Multiply fund is an example of the UK Government not providing value …
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We have also heard from the Scottish and Welsh Governments, and officials from the Northern Ireland Executive, that levelling up funding was not always compatible with devolved policy and that the method of distribution was not appropriate. The Multiply fund is an example of the UK Government not providing value for money when it comes to matters under the UKIMA and devolved policy. Although the UK Internal Market Act 2020 provides the Government with powers to support economic and education development across the UK, we have heard that the method for distributing Multiply funding was wasteful and not done in the most efficient way.
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Government response AI summary
The government acknowledges shared goals with devolved administrations and asserts they are working closely across various levelling up areas, citing examples like joint Freeports, and consultations on the Levelling Up Fund and UKSPF to agree bespoke interventions and align with priorities. They do not directly …
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Ministry of Housing, Communities and Local Government
29
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
Where the DLUHC is seeking to provide funding in [policy] areas that are generally understood to be devolved, it is critical that the Department works hand in glove with the Devolved Governments. As such, through good communication and close collaboration, the Department should ensure the distribution of funding reflects the …
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Where the DLUHC is seeking to provide funding in [policy] areas that are generally understood to be devolved, it is critical that the Department works hand in glove with the Devolved Governments. As such, through good communication and close collaboration, the Department should ensure the distribution of funding reflects the knowledge, expertise, and preferences of the Devolved Governments so far as it compatible with the purpose and objectives of the funding, whilst acknowledging the provisions under the UK Internal Markets Act. We recommend that in future the DLUHC ensures there is ongoing and more detailed engagement with the Devolved Governments at a level deemed sufficient by Wales, Northern Ireland, and Scotland to allow for emerging challenges to be addressed in a timely and efficient manner.
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Government response AI summary
The government describes its existing and past close collaboration with devolved administrations on Levelling Up, citing examples like joint Freeport announcements, seeking input on the Levelling Up Fund, and developing bespoke interventions for the UKSPF, asserting it is already working closely across the UK.
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Ministry of Housing, Communities and Local Government
30
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
The lack of consideration for the circumstances in which the Executive and its Officials in Northern Ireland operate is of even greater concern to us and speaks to an on- going theme we found throughout this inquiry regarding the extent of consultation carried out by the DLUHC with Devolved Governments …
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The lack of consideration for the circumstances in which the Executive and its Officials in Northern Ireland operate is of even greater concern to us and speaks to an on- going theme we found throughout this inquiry regarding the extent of consultation carried out by the DLUHC with Devolved Governments and stakeholders. We heard that the parameters for engagement set out by the Department in their initial phase of consultation were not compatible with section 75 of the 1998 Northern Ireland Act. Officials from Northern Ireland told us that the Department did not use existing structures for engagement in Northern Ireland and, because their engagement was not in line with the 1998 Act, officials were at risk of legal proceedings if they did engage. We have not had a satisfactory explanation from the Department on this matter and this issue remains unresolved.
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Government response AI summary
The government acknowledges the importance of Section 75 considerations for Northern Ireland. They state that for UKSPF, applicants must describe impacts and collect data on protected characteristics, and they will further embed these considerations. For the Levelling Up Fund, they explain that Memorandums of Understanding …
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Ministry of Housing, Communities and Local Government
31
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
In the future, the DLUHC must make sure that its engagement with officials in Northern Ireland is compatible with section 75 of the 1998 Northern Ireland Act, so 42 Funding for Levelling Up that in the absence of an Executive, officials in Northern Ireland are able to engage with the …
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In the future, the DLUHC must make sure that its engagement with officials in Northern Ireland is compatible with section 75 of the 1998 Northern Ireland Act, so 42 Funding for Levelling Up that in the absence of an Executive, officials in Northern Ireland are able to engage with the DLUHC. For this reason, the DLUHC must avoid needlessly reinventing the parameters for engaging with stakeholders in Northern Ireland and instead engage with them through existing structures to avoid these challenges in the future. (Paragraph 106) Local growth
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Government response AI summary
The government outlines existing measures to ensure engagement with Northern Ireland officials is compatible with Section 75 of the 1998 Northern Ireland Act, including requiring UKSPF applicants to describe project impact and using MoUs for the Levelling Up Fund, while acknowledging the challenge of a …
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Ministry of Housing, Communities and Local Government
32
Conclusion
Sixth Report - Funding for Levelling Up
Accepted
The Government’s flagship Levelling Up policy is one in a long line of local growth initiatives. The National Audit Office reported that since 2010 there has been the repeated introduction of ‘new’ local growth policies. The stop-start character of local growth initiatives has arguably slowed or even in some case …
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The Government’s flagship Levelling Up policy is one in a long line of local growth initiatives. The National Audit Office reported that since 2010 there has been the repeated introduction of ‘new’ local growth policies. The stop-start character of local growth initiatives has arguably slowed or even in some case prevented the development and provision in local areas of infrastructure to support individuals and communities through long and sustained interventions. International comparisons have been drawn with the longevity of funding associated with Germany’s reunification project which spanned several years. This policy has been referred to by some as a model of best practice when comparing the benefits of longer-term, substantive, growth initiatives and funding. We also note that the levelling up missions, as set out in the White Paper, are intended to be achieved or to have seen some progress by 2030, which only allows for under 10 years for the policy’s aims to be achieved.
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Government response AI summary
The government acknowledges the historic stop-start approach to local growth and states that Levelling Up is a long-term programme, with the Levelling Up and Regeneration Bill enabling missions to continue beyond 2030. It also refers to a recently published simplification plan to improve the current …
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Ministry of Housing, Communities and Local Government
34
Recommendation
Sixth Report - Funding for Levelling Up
Accepted
We note the significant cross-party consensus there appears to be for the challenges that the Levelling Up policy is seeking to solve. We recommend that future Governments take a more sustained and long-term approach to levelling up matched by ongoing and secure funding. This must avoid unnecessary duplication and not …
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We note the significant cross-party consensus there appears to be for the challenges that the Levelling Up policy is seeking to solve. We recommend that future Governments take a more sustained and long-term approach to levelling up matched by ongoing and secure funding. This must avoid unnecessary duplication and not lead simply to the creation of more local growth initiatives. Only in this way can the policy begin to address the challenges outlined in the White Paper and ultimately find success in ‘levelling up’ the UK. (Paragraph 111) Funding for Levelling Up 43
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Government response AI summary
The government states that the Levelling Up policy is already a long-term program, with missions set until 2030 and provisions for continuation beyond. They also reference a simplification plan to streamline funding and reduce duplication, claiming existing efforts address the recommendation.
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Ministry of Housing, Communities and Local Government