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Economic Assessment Duty

The Local Democracy, Economic Development and Construction Bill, currently going through Parliament, places a new duty on county councils and unitary authorities to assess the economic conditions of their area.

It is anticipated that the Government will publish draft guidance on how local economic assessments should be taken forward shortly. However, a number of core principles have already been identified as follows:

“A local economic assessment should provide local authorities and their key economic partners with a clear understanding of local economic conditions at all spatial levels, from urban through to rural areas. It should map economic linkages and identify the key factors enabling and constraining sustainable economic development. This understanding, embedded in the activities of the local strategic partnership, should lead to improved economic intervention including better spatial prioritisation of investment, and contribute to the overall aim of delivering sustainable development.

In undertaking their assessments, local authorities will need to take account of the broad range of factors that impact, both positively and negatively, on the economic well-being of individuals and communities. These factors will vary in importance between places, but could include the impact of demographic change, sparsity and peripherality, environmental opportunities and pressures, housing and infrastructure and the role of transport and skills.

The Government therefore believes that there are a number of broad principles that should be applied to ensure that they have maximum impact; as follows:

  • identify the economic linkages, including the links between the urban and rural economies, within the area of the assessment and between it and the wider economy
  • identify the comparative strengths, weaknesses, opportunities and threats facing the local economy
  • review the key ways in which local authorities and their partners influence local economic development and their impact
  • review the regeneration challenges of the area
  • analyse causes of worklessness
  • consider the impact of local economic development on the environment, and how the local economy will be affected by the transition to a low-carbon economy.”

CLG Policy Statement on Local Economic Assessments, January 2009 (link to PDF on external website)