Organisations that can receive funding can include local authorities, public sector organisations, higher and further education institutions, private sector companies, community and voluntary sector organisations and registered charities. Lead authorities can also work with international partners if they can demonstrate the benefits for local communities.
Funding investment can commence from 1 April 2022. However, interventions that commence before investment plan sign off will be done at risk. Administrative and preparations costs can be incurred from 1 April 2022. Interventions should be delivered by March 2025 or have a break clause allowing for closure by March 2025.
The LGA has been clear that a longer-term funding arrangement is needed. This applies especially for the ‘People and Skills’ priority, which will only operate one year programmes. It will make programmes which target those furthest away from the jobs market more difficult to deliver effectively. This is yet to achieve the Government’s Levelling Up ambition of providing areas with a simplified, long-term funding settlement.
Interventions can be funded through:
- grants to public organisations
- commissioned third party organisations
- procurement of service providers
- in-house provision.
Consideration of the Cabinet Office’s Grant Standards will need to be made in deciding which model to adopt. It is positive that lead authorities have been offered the flexibility to choose which model suits them. The LGA will continue to work with Government to ensure any guidance is consistent and beneficial for lead authorities.
Unlike the majority of the European Structural and Investment Programme, match funding is not a requirement for the UKSPF, but is recommended. Lead authorities who do obtain match funding to supplement their UKSPF interventions will be required to provide updates.
Lead authorities will need to ensure they set out how their interventions will be delivered within the subsidy control regime and their capacity and capability to manage the regime. Following requests from the LGA, the Government will be publishing further guidance on state aid.
The Government will pay each lead local authority in advance. In 2022/23, funding will be paid once the local investment plans are signed off, while payments of the remaining two years will occur at the start of the financial year. Each lead authority will receive a grant determination letter and Memorandum of Understanding setting out funding requirements and obligations. Underspend will be asked to be returned at the end of each financial year. The LGA has concerns that this is likely to mean shorter term interventions will therefore be prioritised and does not provide the longer term, stable funding regime needed to level up local communities.