Agenda item

(i)         Joint Report of the Assistant Chief Executive and the Corporate           Director of Regeneration and Economic Development.

(ii)        Presentation by the Head of Strategic Programmes and Performance,            Regeneration and Economic Development.

The Chairman asked the Head of Strategy, Programmes and Performance to give Members an overview as regards the new European Union (EU) Structural and Investment Funding Programme (for copy see file of minutes).

The Head of Strategy, Programmes and Performance explained that there were several positive opportunities within the new EU Structure Funding Programme and that funding operated on a 7 year cycle, the new period being 2014 – 2020.  Members were informed that the notional allocation to the NELEP area was €539.6 million, with Durham as a “transition” area having a ring-fenced allocation of €157 million.  Councillors noted that there was scope for additional funding above that and there was flexibility in how the funds could be spent.  It was added that LEPs were to produce, for their area, a “European Investment Strategy” that would form part of the wider “Growth Plan” and also tie into other EU objectives.  Members noted that there was alignment with the “Growth Deal”, however, some European Funding was available to spend from mid-2014, Growth Deals from April 2015.

The Committee learned that the EU Investment Strategy was a “broad brush” as regards spending and was for areas of spend rather than projects.  It was explained that the final European Structural and Investment (ESI) Strategies must be submitted by LEPs by the end of January 2014.  Members learned that there were several core themes and they were split between European Regional Development Fund (ERDF) and ESF areas with a 60:40 ratio.  It was noted that there were 4 core themes within under ERDF that would have to have 60% spend: Innovation; Small and Medium Sized Enterprise (SME) competitiveness; ICT; and low carbon, with a minimum of 15% on low carbon.  Councillors were informed that there was also scope for areas such as Climate Change adaptation, environmental protection and sustainable transport.  The Head of Strategy, Programmes and Performance noted that for ESF, the areas were Employment, Skills and Social Inclusion, with the latter having a requirement of at least 20% ESF. 

Councillors learned that there were 3 LEP workstreams: Vision; Pipeline; and Governance, with the Head of Strategy, Programmes and Performance being the Chairman of the latter.  It was explained that within Durham, the submission was being worked on via the CDEP with involvement from various partners, as necessary, at the project level.  Members noted that emerging investments included “smart growth” areas such as capital and infrastructure investment and provision of SME space at key employment sites; tailored business support; supporting innovation, linked to Durham University; and Digital Durham.  Councillors learned that in respect of “inclusive growth” there were areas such as: Business Energy Efficiency Programme; Development of Renewable Energy Village; Flood Mitigation; Sustainable Transport; Promoting employment and labour mobility, including youth employment; employment and brokerage service; community led local development volunteering; apprenticeship packages; graduate support programmes; and work based learning.  The Committee learned that there was a strong role for the AAPs in this respect. 

The Head of Strategy, Programmes and Performance explained that in the past there was little or no say from local areas on what national programmes they wished to be involved in.  Members noted now it was for local areas to “opt-in” and in effect Government has to sell these programmes to local areas.  It was added that such national programmes included UK Trade and Investment (UKTI), Manufacturing Advisory Service (MAS), Growth Accelerator, Skill Funding Agency, European Investment Bank (EIB) and Big Lottery.  Members learned that it would be in many cases be a “balance of benefits” when considering opt-in for national scheme, whether the match funding would outweigh local autonomy in operating a programme. 

Councillors learned that the Youth Employment Initiative attracted “cohesion fund” to some NUTS2 regions, including Durham and Tees Valley, equating to €9 million for Durham for 2014 and 2015, to be matched with €9 million from Durham’s ESF allocation.  Members noted that the total programme of €24 million needs to be committed and mostly spent by 2015, to support sustainable integration into the labour market of NEETs (those Not in Employment, Education or Training) aged 15-24.  Members learned that Linda Bailey, Strategic Manager - Progression and Learning, Children and Adults Services, DCC was Chairperson of the relevant group at the CDEP.

The Head of Strategy, Programmes and Performance concluded by noting that next steps were:

·        For the CDEP to continue to take lead on developing Durham’s “Transition” programme and feed into the LEP Strategy.

·        Wait and respond to Government.

·        Continue to raise awareness and identify opportunities.

·        Start working up project ideas into projects using a partnership approach to leverage synergies.

·        Maintain the CDEP partnership group as the vehicle for doing this for the Durham transitional programme.

·        Scrutiny involvement in the CDEP Conference.

The Chairman thanked the Head of Strategy, Programmes and Performance and asked Members for their questions. 

Members asked questions relating to flexibility of spend across areas; timescales in order for money to be spent and noted that some reports referred to figures in sterling, some in euros and that consistency would be helpful.

The Head of Strategy, Programmes and Performance noted that there was flexibility in the funds allocated to the NELEP, however there were funds specifically for County Durham, and then other funds that could be spent anywhere in the NELEP area, including County Durham.  Members were informed that funds would need to allocated by 2015 and spent within 2 years after the end of the scheme, by 2017.  It was noted that the SFA usually distributed those types of funds and there would be further details within the next 3-4 months as regards this.  The Chairman noted that a further report would be brought to the Committee in February 2014, though if any major developments occurred in the interim, then this should of course be brought back to Members sooner.

Resolved:    

(i)         That the report and presentation be noted.

(ii)        That the Economy and Enterprise Overview and Scrutiny Committee receive future   updates on the development of the EU Structural and Investment Funds Programme   2014 - 2020.