In the standard democratic process in the UK, a piece of legislation is circulated, has amendments written to it, is voted on in the House of Commons, and then voted on in the House of Lords. The people in the Commons who vote have their vote recorded and are (in theory) democratically accountable to the people who have voted them in. Any guidance provided from the civil service can be obtained by the Freedom of Information Act (FoI), so that voters can have a more direct insight to what is going on. Debates are held in Parliament and so the pros and cons of the legislation are openly discussed. It’s not perfect, but there is some degree of transparency in the system.
Now compare this to the way that SeaChange operates. SeaChange (the trading name of the company: its registered name is East Sussex Energy Infrastructure and Development Ltd) is a private (not for profit) company that has members of East Sussex County Council, Hastings Borough Council and Rother District Council on the board (amongst others). Note that the board has members of both the Conservative and Labour parties on it (e.g. Lord David Ampthill, Conservative councillor on Rother District Council, and Peter Chowney, Labour councillor on Hastings Borough Council). As a private company SeaChange is not subject to Freedom of Information laws.
The main purpose of SeaChange appears to be proposing ‘regeneration’ projects that are then submitted to the South East Local Enterprise Partnership (SELEP) for funding. These projects compete with other projects in East Sussex, Kent and Essex for Local Growth Fund (LGF) money. Note that the LGF is a loan and has to be paid back, so this puts limits on the types of projects that SeaChange are able to put forward. The LGF also has a political purpose in that it must be for “economic development”.
The competitive element is claimed by the government as the best way for the strongest projects to receive the funding. Local Enterprise Partnerships (LEPs) are subject to Freedom of Information requests which are done via the leading authority. In the South East the responsible authority is Essex County Council. Local Government budgets were reduced significantly over the last Parliament, and are now being reduced even further. Local authorities and councils are very limited in the ways that they can raise revenue, so funding from LEPs has taken on a much greater significance of late.
The government has set out a requirement that LEPs should be transparent:
“All Local Enterprise Partnerships will be required…to comply with basic reporting and independent audit requirements to support transparency and effective accountability. The Government intends to work with LEPs to co-design these, but [they] could for example take the form of an annual report, with information on what the money has been spent on, and the outcome/ outputs that it has achieved. Successful delivery of the objectives agreed in Growth Deals will be a fundamental consideration in future rounds of the Local Growth Fund.”
It appears at the very heart of this investment strategy is a lack of trust of Local Government by Central Government. It roughly translates to, if you want money in your area you must do projects that align with our objectives, i.e. a top-down method. Local politicians who want to be able to claim that they’ve created jobs in their area have no choice but to take the SELEP coin. At best the public are treated like an unwanted gatecrasher, with access to information difficult or impossible.
At what point in this structure of decision making is there any incentive for anyone to openly object to how the money is being spent? If it all goes wrong it has consequences for further applications for funding, so there is no incentive to give honest feedback from projects – see the previous failed SeaChange projects for examples of where it has all gone wrong, but nobody is held accountable.
So we are hindered by not being able to learn from our mistakes. The same mistakes will be made again and again. The public are seriously restricted in seeing how the money is being spent as the complex interactions between multiple organisations (some of which are not subject to FoI) are extremely difficult to follow. All of the people within the system – including members of both the Labour and Conservative parties – have a vested interest in the system being shown to work. The only realistic way to find out if things are going wrong is for a whistle-blower to come forward. Anyone?