HBC deprived of last chance to win Levelling Up Fund grant

Hastings Borough Council has missed out on its last chance to win a grant from the £4.8bn Levelling Up Fund after the government decided to bypass a bidding round. However HBC has recently come in for £40m of government money to improve local living conditions from other funds. Text by Nick Terdre, research and graphics by Russell Hall.

The Department for Levelling Up, Housing and Communities last week announced the award of £974m to 55 successful bids in the third and final round of the Levelling Up Fund, an average of £17.7m per award.

However Hastings Borough Council was not among the successful bidders. This was due to the council’s failure to bid in round two. In January the department confirmed that a third round would be held, but in the event, for reasons best known to itself, it decided that round three awards would be made to the best unsuccessful bids in round two. That meant that Hastings, which also failed to bid in the first round, was not even among the runners for round three.

One reason for the department’s decision to use unsuccessful round two bids as the basis for round three awards may have been the large number of them – 418 out of a total of 529. Assessed according to a methodology prepared under wraps but now made public, most remained unsuccessful – with only 55 awards, 363, or nearly 87%, went in the bin, this time presumably for good. That represents a lot of wasted work for hundreds of councils.

Moreover 93 English councils in priority areas, including Hastings, and all 65 local authorities across Scotland, Wales and Northern Ireland received so-called capacity funding of £125,000 to help them prepare their bids – in view of all the unsuccessful bids that represents a sizeable sum which also went down the drain.

Criticism

Another reason for the department taking this route may be that it avoided competitive bidding, which attracted a lot of criticism in the previous two rounds, not least because only a minority of bidders were rewarded, as was also the case in the latest round.

The department kept its third round policy confidential until the last moment. As recently as 16 October, when MP Michael Fabricant asked in the Commons what time-scale there was for the next LUF round, DLUHC secretary of state Michael Gove replied, “…we will make sure that Levelling Up Fund Round 3 is brought forward just in advance of the autumn statement.”

HBC had intended to use its Levelling Up Fund grant to build a new sports, cultural and health campus on the site of the Summerfields leisure centre. In an email to councillors in June 2022 council leader Paul Barnett explained that on the advice of consultants it had been decided to forego the second round due to shortage of time to prepare a really strong bid.

It was a gamble as at the time the DLUHC had not stated that there would be a third round.

Modest rewards for East Sussex

East Sussex in general gained only modest rewards from the £4.8bn Levelling Up Fund. Eastbourne (£19.8m), Lewes (£12.7m) and East Sussex County Council (£8m) received grants in round one and Rother (£19.2m) in round two. Lewes also successfully bid for £19.3m from the Towns Fund and £5m from the Future High Streets Fund.

HBC however recently became one of 20 towns to be awarded £20m from the Levelling Up Partnership and another £20m to be spent over 10 years from the Long-Term Plan for Towns. Rother received the same amounts from both funds. In both cases the award was based on the two recipients’ low scores in an assessment of skills, pay, productivity and health.

In terms of pay and skills - two of the four metrics assessed for the Levelling Up Partnership and Long-Term Plan for Towns, this interactive plot graph shows that both Hastings and Rother rank low - but so does Eastbourne which received nothing from either fund.

Hastings comes out best

Added to £1m from the UK Shared Prosperity Fund, £24.3m from the Towns Fund and £751,000 from the UK Community Renewal Fund, Hastings is now the recipient of £66m from all levelling up pots, the most of any East Sussex local authority. Rother comes second with £60.2m. Hastings and Rother also did best in per capital terms - see graph below.

As well as Hastings, the UK Shared Prosperity Fund awarded £1m each to Eastbourne, Rother and Lewes, £1.2m to Wealden and £2.5m to East Sussex County Council. Meanwhile Hastings benefited to the tune of £750,998 from the Community Renewal Fund, which also awarded £719,100 to Lewes and £1.1m to ESCC, which separately received £41.4m to improve bus services.

Worst off of the local authorities is undoubtedly Wealden, which has received only a paltry £1.2m, despite submitting a £19.6m bid in round one of the Levelling Up Fund.

The apparent generosity of this funding for Hastings and Rother in particular should be seen in the context of the reduction in central government funding for local councils since 2010, with local authority ‘spending power’ – the amount of money authorities have to spend from government grants, council tax and business rates – falling by 10.2% between 2009/10 and 2021/22, according to the Institute for Government.

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