RDA veteran defends value to business

Scrapping the regional development agencies would reduce business influence on government policies, the country’s longest serving RDA director has warned.

Jim Brathwaite, the entrepreneur who has just stood down as chairman of the South East England Development Agency after seven years, said the Tories’ proposals for axing the agencies would be a “setback for business” at a time when companies needed all the help they could get.

In an interview with the Financial Times, the veteran businessman urged David Cameron: “Don’t throw the baby out with the bathwater.” He said the RDAs had been “analysed to death”, but were the only bodies that could both implement economic development policies and communicate the opinions of business directly to ministers.

Mr Brathwaite believed the Conservatives were likely to soften their plans for the RDAs as the election drew closer. “The business fraternity is making its voice heard. One thing you can say about RDAs is they have contributed greatly to [economic development] and business understands that.”

He said RDAs had become more sophisticated organisations in recent years. “When I started I had about £90m to spend and it was already predetermined,” he said. “Now [SEEDA] has got about a quarter of a billion pounds to spend over a couple of years and we can help determine what happens.”

He agreed with comments made earlier this year in the FT by Peter Rogers, chief executive of the London Development Agency, that RDAs should become influencers rather than primary funders of projects.

As an example, he pointed to a SEEDA project co-ordinating energy efficient retrofitting of homes which is planned to cover the whole region, bringing together energy companies, private sector businesses and government agencies. “We are talking billions of investment,” he enthused. “No other agency could pull it together.”

Some RDAs have been criticised over their handling of cash. In particular, the LDA was widely lambasted last year for funding projects that failed to deliver and has recently admitted a £159m hole in its budget for purchasing Olympic land. Mr Brathwaite himself faced controversy over a £50,000 bill for using executive cars and taxis.

Mr Brathwaite, said he had not realised how “political” RDA posts had become, but insisted the RDAs, which have experienced tough budget cuts, were good value for money. He pointed to a PwC report that found SEEDA had generated £5.60 in gross value added for every £1 it spent. “We really do punch our weight.”

He added: “If you take [RDAs] away you take away the ability of business to influence government. David Cameron talks about bringing business people into government but they are already there. They are sitting in the RDAs.”

He also poured scorn on Conservative suggestions that local authorities could take over the RDA’s economic development responsibilities.

“Local authorities don’t have the capacity to do it. They never did,” he said.

“Why create something when you have already got it? Why not use them for your own policies rather than rip it up and start again?”

Though he acknowledged the squeeze on public spending, he said: “We are all worried about levels of [public] debt, but. . .we should be worried about how you create the wealth to pay it back. And that’s what RDAs do.”
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