Select Committee · Public Accounts Committee

Selecting towns for the Towns Fund

Status: Closed Opened: 27 Jul 2020 Closed: 9 Nov 2020 7 recommendations 20 conclusions 1 report

On 27 July 2019, the government announced the £3.6 billion Towns Fund for England, to support towns that currently do not have the right conditions to develop and sustain strong local economies and recognising that many towns have not benefited from the growth experienced by cities over recent decades. Its aim is to provide a … Show more

Reports

1 report
Title HC No. Published Items Response
Twenty-Fourth Report - Selecting towns for the Towns Fund HC 651 11 Nov 2020 27 Responded

Recommendations & Conclusions

27 items
2 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

The Department has a weak and unconvincing justification for not publishing any information on the...

The Department has a weak and unconvincing justification for not publishing any information on the process it followed, which does not vindicate its lack of transparency. The Department says that it did not reveal the detail behind its selection of towns so as not to raise local expectations about an … Read more

Government response AI summary
The government commits to providing a record of Ministerial recusal, decision criteria, and assessment scores upon completion of all Towns Fund decisions. It also plans to publish Heads of Terms on GOV.UK when agreed with towns.
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HM Treasury
3 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

It is unclear how much engagement and intelligence gathering, if any, Ministers held with local...

It is unclear how much engagement and intelligence gathering, if any, Ministers held with local and regional representatives, to inform their selection of towns from the medium- and low-priority groups. Departmental officials assessed towns against three qualitative criteria using the knowledge of the Department’s area-based teams, rather than consult with … Read more

Government response AI summary
The government agrees with the recommendation and states it is already implemented, citing existing expectations for Town Deal Boards, assessed governance, and requirements for local stakeholder and resident consultation specified in the Towns Fund guidance.
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HM Treasury
4 Recommendation Twenty-Fourth Report - Selecting towns … Deferred

It is still unclear what impact the Department is expecting from the Towns Fund, or...

It is still unclear what impact the Department is expecting from the Towns Fund, or when, and how the Department will measure its success. Although the Department is positive about the quality of the 13 plans submitted by the first cohort of towns and describes how it is assessing plans … Read more

Government response AI summary
The government's truncated response indicates an annual update will be provided from the monitoring and evaluation process but does not, in this response, set out the requested details on how the fund will secure long-term outcomes, measures of success, or specific job creation metrics.
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HM Treasury
5 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

We are concerned that towns may not have the capacity to deliver their plans and...

We are concerned that towns may not have the capacity to deliver their plans and spend the money well. The Department says that the towns most in need of investment would have been disadvantaged in a competitive bidding process because of a lack of leadership, resources or experience of dealing … Read more

Government response AI summary
The government accepts the recommendation and commits to providing annual updates to the Committee on the Towns Fund's progress, including an assessment of towns' capacity to deliver their plans, with a target implementation date of April 2021.
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HM Treasury
6 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

It is not clear how the Towns Fund fits with other government funding programmes with...

It is not clear how the Towns Fund fits with other government funding programmes with overlapping aims. The Department confirms that, despite the impact of Covid-19 on government spending plans, the £3.6 billion funding allocated to the Towns Fund is secure. It has no plans to do anything other than … Read more

Government response AI summary
The government agrees, stating the Towns Fund is a central component of the Levelling Up strategy and that the new Levelling Up Fund, announced at the 2020 Spending Review, will consolidate fragmented funding streams to provide greater clarity and alignment across programmes.
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HM Treasury
7 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

The impact of Covid-19 is likely to mean that some towns’ plans for how best...

The impact of Covid-19 is likely to mean that some towns’ plans for how best to spend the money will need to be revisited. We are very concerned about the short-term and long-term effects of Covid-19 on towns, and high streets in particular. The Department tells us that its guidance … Read more

Government response AI summary
The government agrees with the recommendation, stating it has already provided accelerated funding to towns in September 2020, allowed additional time for plan development, and encouraged towns to review plans to address the ongoing impact of Covid-19.
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HM Treasury
1 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

On the basis of a report by the Comptroller and Auditor General, we took evidence...

On the basis of a report by the Comptroller and Auditor General, we took evidence from the Ministry of Housing, Communities and Local Government (the Department) about the Towns Fund.1

Government response AI summary
The government acknowledges the committee's introductory statement, confirming the basis of the report and the timeline of evidence and publication.
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HM Treasury
8 Conclusion Twenty-Fourth Report - Selecting towns … Rejected

The Department’s lack of transparency fuelled accusations of political bias in the selection process.16 Furthermore,...

The Department’s lack of transparency fuelled accusations of political bias in the selection process.16 Furthermore, the Department’s statements to the press, issued after the National Audit Office’s report was published, referred to the report concluding that the selection process had been ‘robust’, whereas the report makes no such statement—which is … Read more

Government response AI summary
The government disagrees with the committee, stating that wider government practice precludes sharing full Accounting Officer advice and that a summary, NAO report, and ministerial statements provide sufficient detail on selection decisions.
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HM Treasury
9 Conclusion Twenty-Fourth Report - Selecting towns … Accepted in Part

Other examples of lack of clarity around the Towns Fund process are also of concern...

Other examples of lack of clarity around the Towns Fund process are also of concern to us. The Department gave a confusing explanation for how and why the risks from a no- deal Brexit were assessed by Ministers, when already included in Departmental officials’ assessment. The Department agreed to write … Read more

Government response AI summary
The government states it has already provided details on Brexit risk assessment, published further guidance on assessment processes, and will provide transparency on future funding decisions. It notes the Towns Fund competitive round is now part of the Levelling Up Fund, with processes to be …
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HM Treasury
10 Conclusion Twenty-Fourth Report - Selecting towns … Not Addressed

We heard from the Department that its officials had assessed each town against three qualitative...

We heard from the Department that its officials had assessed each town against three qualitative criteria using the knowledge of its area-based teams, rather than consulting directly with local stakeholders. The Department argued that it gave more weight to the quantitative criteria in its assessment, and that its area-based teams … Read more

Government response AI summary
The government's response details ongoing engagement with local representatives and requirements for Town Deal Boards to involve local stakeholders, but it does not address the committee's observation regarding the lack of direct consultation or ministerial rejection of advice during the initial town selection process.
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HM Treasury
11 Conclusion Twenty-Fourth Report - Selecting towns … Not Addressed

We queried why the Department had required a new tier of governance—Town Deal Boards—to be...

We queried why the Department had required a new tier of governance—Town Deal Boards—to be set up, rather than use existing governance structures to plan and implement the Towns Fund at the local level. The Department explained that existing structures, such as mayoral combined authorities and Local Enterprise Partnerships, were … Read more

Government response AI summary
The government's response details its expectations for Town Deal Boards and their engagement but does not directly address the committee's query about the rationale for creating a new tier of governance instead of utilising existing local structures.
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HM Treasury
12 Recommendation Twenty-Fourth Report - Selecting towns … Accepted

The Department told us that it is satisfied that the Town Deal Boards are well...

The Department told us that it is satisfied that the Town Deal Boards are well constituted, meeting departmental stipulations, and coming together well. Boards are involving the private sector and the wider social sector, with examples of some Boards being chaired by private sector business people and others by chairs … Read more

Government response AI summary
The government states it has already set out expectations for Town Deal Boards regarding stakeholder and community engagement in its prospectus and guidance. It assesses board governance and requires towns to provide rigorously assessed stakeholder engagement plans.
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HM Treasury
13 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

The Department told us that it had not completed its analysis of the 13 plans...

The Department told us that it had not completed its analysis of the 13 plans submitted by the first cohort of towns but its early impressions of the quality of the plans and the range of interventions proposed were positive.30 It described how it was assessing town investment plans against … Read more

Government response AI summary
The government acknowledges the committee's observation about its assessment of town investment plans. It states it conducts thorough reviews of town capacity and plan deliverability as part of the established investment process and provides ongoing support to towns.
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HM Treasury
14 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

Given our concerns in the past about the Department’s failure to put in place quantifiable...

Given our concerns in the past about the Department’s failure to put in place quantifiable objectives to help it measure the impact of its interventions on local economic growth, we asked the Department how it intended to approach this for the Towns Fund, to properly measure impacts such as job … Read more

Government response AI summary
The government agrees with the committee's observation regarding monitoring and evaluation. It details existing plans for national and project-level impact assessments and commits to publishing its full monitoring and evaluation strategy in Spring 2021, providing annual updates to the Committee.
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HM Treasury
15 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

The Department told us that it is looking to probe each project to gauge how...

The Department told us that it is looking to probe each project to gauge how convinced it is that towns can deliver their plans successfully, and that it will build in robust monitoring and evaluation processes from the start, agreeing key outputs and outcomes such as jobs created and footfall … Read more

Government response AI summary
The government disagrees with the committee's conclusion about a lack of clarity on impact measurement, outlining specific plans for national and project-level monitoring and evaluation, including tracking metrics on employment, income, and wellbeing, and commits to publishing the full strategy in Spring 2021.
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HM Treasury
16 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

The Department’s rationale for opting for “a deals-based approach” to funding, rather than a competitive...

The Department’s rationale for opting for “a deals-based approach” to funding, rather than a competitive bidding process, was because towns most in need of investment would have been disadvantaged in a competitive bidding process due to a lack of leadership, resources or experience of dealing with government departments. The Department … Read more

Government response AI summary
The government agrees with the implied recommendation to support towns, reiterating its recognition of multiple funding programmes and its support for towns to align funding and develop strategic Town Investment Plans. It notes the Levelling Up Fund includes previous Towns Fund competition money.
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HM Treasury
17 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

The Department further told us that it had entered into a contract worth around £8...

The Department further told us that it had entered into a contract worth around £8 million with Arup, a professional services company, to provide towns with specific expertise in areas such as real estate valuation. The Department described the efficiency benefits it envisages in such an arrangement, whereby towns will … Read more

Government response AI summary
The government acknowledges the committee's observation regarding its contract with Arup for consultancy support, confirming that Arup and its consortium provide additional support to towns as the Towns Fund Delivery Partner.
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HM Treasury
18 Conclusion Twenty-Fourth Report - Selecting towns … Not Addressed

The Department told us that it is working at pace to agree the funding that...

The Department told us that it is working at pace to agree the funding that will be available for the 13 towns in the first cohort and would like to be able to make decisions in October. But the Department did not want to guarantee it would meet that deadline … Read more

Government response AI summary
The government's response, which incorrectly categorises the conclusion as a recommendation, details accelerated funding provided to towns due to COVID-19 but does not address the committee's observation regarding potential delays in agreeing funding and issuing final project approvals.
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HM Treasury
19 Conclusion Twenty-Fourth Report - Selecting towns …

The Department has developed a funding profile for the Towns Fund over the next four...

The Department has developed a funding profile for the Towns Fund over the next four financial years but does not know yet whether it aligns with towns’ individual investment plans. The Department explained that it wants the profile of funding over time to be led by what works in terms … Read more

HM Treasury
20 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

The £3.6 billion Towns Fund has three separate strands of funding comprising: • The 101...

The £3.6 billion Towns Fund has three separate strands of funding comprising: • The 101 selected towns invited to develop Town Deals and bid for up to £25 million each, or up to £50 million in exceptional circumstances; • A competition for funding for those towns not in the initial … Read more

Government response AI summary
The government acknowledges the description of the Towns Fund's structure and provides an update, stating that the competition for towns not in the initial selection will now be run as part of the new Levelling Up Fund.
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HM Treasury
21 Conclusion Twenty-Fourth Report - Selecting towns … Not Addressed

The Department confirmed that, despite the impact of Covid-19 on government spending plans, the £3.6...

The Department confirmed that, despite the impact of Covid-19 on government spending plans, the £3.6 billion funding allocated to the Towns Fund is secure. It told us that it had no plans to do anything other than continue with the Towns Fund and to deliver the fund in a way … Read more

Government response AI summary
The government's response, again incorrectly categorising the conclusion as a recommendation, details accelerated funding provided to towns due to COVID-19 but does not explicitly re-confirm the security of the £3.6 billion Towns Fund as stated in the committee's observation.
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HM Treasury
22 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

We asked the Department whether, given the scale of change happening, it will bid for...

We asked the Department whether, given the scale of change happening, it will bid for higher levels of funding to support the Future High Streets Fund. It explained that, as many of the towns that are eligible for Future High Streets funding are also eligible for Towns Fund funding, it … Read more

Government response AI summary
The government acknowledges the committee's observation regarding its approach to funding, explaining that it has announced the new Levelling Up Fund to consolidate various funding streams, including £300 million from the Towns Fund, for a more integrated approach to local investment.
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HM Treasury
23 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

The Department told us that many of the bids are aligned with other funds, both...

The Department told us that many of the bids are aligned with other funds, both from central and local government, and highlighted the importance of aligning the Towns Fund projects with other interventions.48 But the specific aims of the Towns Fund and how it fits with other, similar programmes of … Read more

Government response AI summary
The government acknowledges the committee's concern regarding the clarity of the Towns Fund's aims and its fit with other programmes. It responds by detailing how the fund aligns with broader strategies and introduces the new Levelling Up Fund to consolidate various funding streams, clarifying a …
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HM Treasury
24 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

A consistent theme highlighted in the town plans that the Department has seen so far...

A consistent theme highlighted in the town plans that the Department has seen so far is the impact of Covid-19, leading towns to think about a more diverse range of uses for the high street. The Department told us that its guidance steers towns to think carefully about investments that … Read more

Government response AI summary
The government agrees with the implied importance of considering COVID-19 impacts, stating it has already provided £81.5 million in accelerated funding, adjusted timelines, and requires towns to outline COVID-19 considerations in their proposals.
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HM Treasury
25 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

How the impact of Covid-19 will influence decisions about how the Department allocates the Towns...

How the impact of Covid-19 will influence decisions about how the Department allocates the Towns Fund is unclear. Whether towns that have been adversely affected by Covid-19 will have a greater likelihood of selection, or whether events may mean that some of the plans set out in winning bids are … Read more

Government response AI summary
The government agrees with the implied importance of addressing COVID-19 impacts, stating it has already provided £81.5 million in accelerated funding, adjusted timelines, and requires towns to outline COVID-19 considerations in their proposals.
Read full response →
HM Treasury
26 Conclusion Twenty-Fourth Report - Selecting towns … Acknowledged

The Department explained that because of Covid-19 and the recent demands that have been placed...

The Department explained that because of Covid-19 and the recent demands that have been placed on local government, the private sector and other members of the Town Deal Boards, it has left towns and the Town Deal Boards to determine which wave of funding they wanted to work towards.51 While … Read more

Government response AI summary
The government acknowledges the committee's concern about Covid-19's impact on towns' ability to secure match funding. It explains that it has provided accelerated funding, allowed additional time for plan development, and encouraged towns to review plans to adapt to changing circumstances.
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HM Treasury
27 Conclusion Twenty-Fourth Report - Selecting towns … Accepted

The Department has brought forward £80 million of the Towns Fund, with each eligible town...

The Department has brought forward £80 million of the Towns Fund, with each eligible town receiving between £500,000 and £1 million for projects that will make a difference to the area, such as new green spaces, the creation of pop-up businesses spaces, pedestrianisation of streets to encourage walking or cycling, … Read more

Government response AI summary
The government agrees with the implied importance of accelerated funding to address COVID-19 impacts, stating it has already provided £81.5 million in accelerated funding, adjusted timelines, and requires towns to outline COVID-19 considerations in their proposals.
Read full response →
HM Treasury

Oral evidence sessions

1 session
Date Witnesses
21 Sep 2020 Emran Mian · Department for Levelling Up, Housing and Communities, Jeremy Pocklington · Ministry of Defence, Stephen Jones · Ministry of Housing, Communities and Local Government View ↗

Who gave evidence

3 witnesses
WitnessOrganisationSessions
Emran Mian · Director General, Regeneration Department for Levelling Up, Housing and Communities 1
Jeremy Pocklington · Permanent Secretary Ministry of Defence 1
Stephen Jones · Co-Director, Cities and Local Growth Unit, Ministry of Housing, Communities and Local Government 1

Correspondence

1 letter
DateDirectionTitle
6 Jul 2021 Correspondence from Jeremy Pocklington CB, Permanent Secretary Ministry of Hous…