Tourism ignored in first round of Regional Growth Fund grants

By Lorraine Heller

- Last updated on GMT

Related tags: Economics

VisitEngland's £29m bid for funding was rejected by the Regional Growth Fund
VisitEngland's £29m bid for funding was rejected by the Regional Growth Fund
The Regional Growth Fund has refused a bid for funding from VisitEngland in its first round of grants, announced last week.

A new three-year funding programme, the Regional Growth Fund (RGF) will distribute £1.4bn to support projects and programmes with potential to create long-term private sector-led economic growth and create jobs in the country.

VisitEngland had put forward a bid for £29m to help boost domestic tourism, but this was refused in the first round of grants worth £450m.

Lost opportunity

British Hospitality Association (BHA) chief executive Ufi Ibrarhim said the lack of support to the tourism sector is a “lost opportunity” to meet the industry’s aim of creating 236,000 new jobs.

“It ignores the prime minister’s promise in the government’s own Tourism Strategy to take tourism to a ‘whole new level’ and ‘harness the huge potential that this area holds for our economy’.

“This decision takes tourism nowhere.”

BHA said it has written to the prime minister and the tourism minister, John Penrose MP, in protest at this decision.

At the back end of last year, BHA put forward a proposal for partnership between government and industry , which it said could help generate economic growth and create 236,000 jobs over the next five years.

However, Ibrahim last week said that this would not be possible without support from government funds.

“The decision is a totally lost opportunity to create more employment throughout the country,” she said of the RGF grants.

“This is made worse by the removal of £60m of annual tourism funding which has been lost with the abolition of Regional Development Agencies – and which is further compounded by local authority cuts and big reductions in the VisitBritain and VisitEngland budgets.”

‘Real jobs to real people’

RGF said it awarded its first round of grants to 50 companies and partnerships that “demonstrated how they would create jobs and a high level of private sector-led sustainable economic growth in their local communities over the coming years”.

These included bids to expand the Haribo factory near Wakefield, develop a former eye hospital in Manchester into a biomedical centre, and construct a food and drink packaging plant in Teesside.

Lord Heseltine, chair of the Independent Advisory Panel, said the grants support “projects delivering real jobs to real people on the ground now”.

The grants show the government “is getting actively behind the private sector to rebalance our economy,” he said.

The second round of funding, which will aim to allocate nearly £1bn, is now accepting bids.

RGF said that bids to the fund are especially being encouraged from sectors that have not yet submitted bids.

The closing date for round two is 1 July 2011. There may be a further smaller round if unallocated funds remain after rounds one and two.

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