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Just 10% of the money earmarked to regenerate the UK’s local areas under the Government’s levelling-up program has so far been spent, a parliamentary spending watchdog has warned.
The Department for Levelling, Housing and Communities has been unable to provide “any convincing example of what has been achieved so far”, according to a report published by the House of Commons Public Accounts Committee on Friday.
By December 2023, Whitehall had provided councils with just over a third of the £10.47 billion available.
Commission chairwoman Meg Hillier called the delays “absolutely astonishing.” She added that “the vast majority” of projects that got funding early “are now being delivered late,” with further setbacks likely “introduced.”
The committee reviewed the progress of the Leveling Up Fund, the Towns Fund and the UK Shared Prosperity Fund since 2020. The funds include £10.47 billion for economic development projects, as part of the Government’s commitment to reducing socioeconomic gaps regional.
It turns out that only 64 of more than 1,100 projects have been completed so far, while more than 80% of those due to be completed this month will miss that deadline.
Of the £3.7 billion allocated, only £1.24 billion – or 10% – was actually spent.
He also acknowledged the department’s recent attempts to gauge the success of the program, but said he was “concerned that we have no long-term plans to measure the impact” of the funds.
While the Government blamed the Covid pandemic and inflation for delays to the programmes, MPs criticized its design and warned that Whitehall had prioritized seemingly ‘shovel-ready’ projects which later proved more complex .
The funds have long attracted criticism for excessively centralizing economic development spending and imposing unnecessary burdens on municipalities facing a prolonged reduction in funding.
Three-quarters of more than 800 council applications for the first round of the Leveling Up Fund were rejected, with each bid costing an average of £30,000, according to the Local Government Association, the body representing local authorities in England and Wales.
The department has since taken steps to streamline the program for councils, but the committee felt there was “more to do”.
Successful tenders have also had to cope with the impact of inflation, particularly in the construction sector, as well as supply chain shortages, meaning the government has extended many delivery deadlines.
The Grading Department, which oversees the program, appears to have been “blinded by optimism” into funding projects that were far from “shovel-ready,” Hillier said.
The Leveling Department has been contacted for comment.