After months of delays, the second round of the government’s levelling up funding has been announced, handing £2.1bn to 111 projects across the UK.
But the recipients have just two years to spend the money, even though the bulk of funds from the first round have yet to be handed over.
The second round of funding was confirmed at 10.30 last night, amid mounting pressure on the government to finally make the announcement. The allocation was originally due in October last year, but this was postponed due to political instability and a high level of applications.
The investment will include £672m to develop better transport links, £821m to kick-start community regeneration, and £594m to restore local heritage sites.
Over £760m is being provided to regenerate towns and cities and unlock thousands of new homes.
Flagship projects include an Eden Project at Morcambe Bay and a new rail link for Cardiff.
It follows the first tranche of the £4.8bn levelling-up fund, which was announced in 2021. That awarded almost £1.7bn to 105 successful bids, ranging from leisure centres to cultural attractions.
Ministers have confirmed that a third round will go ahead. Many MPs and councils had feared it would be scrapped because of rising inflation.
Prime minister Rishi Sunak said: “Through greater investment in local areas, we can grow the economy, create good jobs and spread opportunity everywhere. That is why we are backing more than 100 projects with new transformational funding to level up local communities across the United Kingdom. By reaching even more parts of the country than before, we will build a future of optimism and pride in people’s lives and the places they call home.”
The prime minister is due to give a short speech on levelling up later today.
Levelling up secretary Michael Gove added: “We are firing the starting gun on more than 100 transformational projects in every corner of the UK that will revitalise communities that have historically been overlooked but are bursting with potential.
“This new funding will create jobs, drive economic growth, and help to restore local pride. We are delivering on the people’s priorities, levelling up across the UK to ensure that no matter where you are from, you can go as far as your talents will take you.”
The complete list of successful bids, ranging from a £4m revamp of Belfast’s Strand Picturehouse to to a £50m grant for Crossrail Cardiff, can be viewed here.
Some areas overlooked in the first round have been allocated funding this time. Blackpool’s first-round bid for £20m, which included gap funding for transforming a former post office into a boutique hotel, has received £40m for a new AI-focused university campus.
Gateshead’s £20m quayside regeneration bid was rejected in 2021, but has now been granted £40m for a new arena, exhibition centre and leisure destination.
The North West takes the lion’s share, with £355m spread over 15 projects. But the South East, with £210m over 10 projects, is the second biggest recipient. London’s eight successful bids will receive £151m. The South West gets £187m for nine projects.
The East of England has received just over £165m for seven projects. Eleven projects in the East Midlands will share £176m. The West Midland’s eight projects will share £156m. Yorkshire gets £121m and the North East receives £108m.
Ten projects in Scotland share £177m, 11 in Wales split £208m, and Northern Ireland received £71m for 10 projects, well up from the £49m alloted in the first round.
More than £670m will go on transport links, £821m on community regeneration and almost £545m to restore local heritage sites. Over £760m is being provided to regenerate towns and cities and unlock thousands of new homes.
Shadow levelling up secretary Lisa Nandy said the fund was in “chaos”, pointing to a Freedom of Information request last year that showed just 5% of first-round allocations had been spent.
Concerns have also been raised over the deadline placed on the recipients to spend the cash.
Peter Hogg, UK cities director at consultancy Arcadis, said: “It is good to get further clarity from the government on levelling up funding, but it is now critical for local authorities that are successful to move quickly and decisively.”
The deadline for spending the money is March 2025, which Hogg said would be “challenging”, particularly as inflation has soared since authorities put in their bids in August last year.
Arcadis has supported 40 bids, 90% of which were successful. Hogg said: “Authorities will need to rapidly move projects through the design phases, complete any land acquisition, secure planning approvals, appoint contractors and move into delivery – no mean feat, especially with no shortage of competing priorities for local government time and resources.”
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