New economic powers for councils

Author: DCLG - Nov 13, 2009

Councils will have new powers to engineer economic recovery locally, following the Royal Assent of the Local Democracy, Economic Development and Construction Bill.

The Act strengthens the democratic role of councils to support local people and businesses to rebuild the local economy, increase jobs and skills, tackle housing shortages and improve infrastructure.

Councils will have a stronger economic role that requires them to work closely with local people and regional partners to deliver growth. The downturn has created different challenges for different areas, which is why councils, as local leaders, have been given the responsibility to find local solutions and to help to integrate these in a single, powerful regional strategy.

The Act creates:

* The responsibility for developing a single regional strategy, which will provide a blueprint for housing, transport and economic development. This will create a coherent action plan for recovery in each region and will be developed jointly by the Regional Development Agencies in partnership with a new local authority Leaders' Board

* A new requirement for councils to undertake an economic assessment of their area - to ensure that authorities can understand the challenges, make informed decisions and contribute to the development of the regional strategy

* New powers to create 'Economic Prosperity Boards' - to give local authorities the ability to create an executive decision-making body at sub-regional level to promote economic development and regeneration across council borders, within the overall framework of the regional strategy

* The creation of Multi Area Agreements (MAAs) with statutory duties - these will provide a further option for local authorities to work together on economic development by allowing MAAs to be put on a similar statutory footing to Local Area Agreements.

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