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Local Area Agreements

Date of speech	22 June 2005

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Draft text of the speech - may differ from the delivered version.

1. Thank you. I am very pleased you have put on this event today because it coincides with the next big step forward for Local Area Agreements. LAAs have already led to the birth of new ideas, new ways of working and a new energy for taking forward local government in this country. I have no doubt there is more to come from the next phase.

2. I want to put on record my thanks, right at the outset, to all those who worked so hard to get this all going in the pilot LAAs - local authorities, their partners, the Government Offices and officials in the ODPM.

3. Before I get down to a little more detail about this, I just want to say a few words about the principles behind LAAs and to look at progress so far. I think you will agree that, for a new Minister, local government is perhaps not the easiest portfolio to take on. The intricacies of local government finance are fully understood by a select few - my predecessor was one of them. Everyone in the country depends on local government's services and it is obvious from the minute you walk out of the front door to when you go to bed that the influence of local government is enormous. There is enormous potential for local government to make a difference to the lives of people living in our communities. That is a huge opportunity and we must grasp it.

4. That opportunity and that challenge are what LAAs are all about. The starting point is a more mature relationship between central government and local government and between local government and its local partners. I welcome Sir Sandy Bruce-Lockhart's commitment to LAAs at the signing ceremony and to developing this new relationship. Take liveability, for example. In central government we put a high priority on improving people's lives in their neighbourhood and we think it is extremely important that there are good quality parks and green spaces. It's obvious these are important in determining quality of life and restoring civic pride. We can set these priorities and provide the tools and support, but enable councils and their partners to develop their own solutions responding to local circumstances. And local government can bring together the right partners - from the public, private and voluntary and community sectors - to take the action needed.

5. These relationships are crucial to LAAs. It means we can reduce bureaucracy, give greater flexibility about how funding is used to meet local priorities and work together in real partnership.

6. What LAAs do is free local partners to deliver on local priorities. It's not that you and your partners are just 'allowed' to try something new and different - we are encouraging you to be adventurous in working with your partners. This is a real opportunity to keep an open mind, focus on what people need and want to see happen in their community, and come up with the best way of delivering it. The result is improving service delivery. We can make communities stronger by raising education standards, tackling crime and anti-social behaviour, addressing the public health agenda and making people wealthier.

6. The first LAAs have taught us a great deal but there is still much more to learn. We know we are not going to get everything right first time. This is a journey not a destination, a voyage of discovery, and we will all learn a great deal as we go along. There is no definite blue print for what the end result will look like - that depends on the different priorities in every different community.

7. For some, it might be tackling pockets of severe deprivation that is top of the agenda. For others, focussing on the needs of the youngest and oldest members of the community or providing integrated facilities that make life easier. Or a combination of all these. The challenges of cities, towns and shires are all very different, and call for different solutions.

8. I know in some areas there are already ground-breaking initiatives in place and significant progress is being made. We must build on that and share successful approaches so they can be used or adapted elsewhere. All our communities must benefit from what is working well and delivering the best.

9. LAAs provide the framework and the freedom to focus delivery on people and to find local solutions for local issues. So it is not surprising that the concept of Local Area Agreements was met with such enthusiasm from all sides when it was launched less than a year ago. The first twenty areas rose to the initial challenge of meeting a very tight timetable for developing and negotiating their agreements. These were signed in March and the enthusiasm at the signing point was as great as it was when they started the progress.

10. The first LAAs brought together, on average, forty different funding streams - and some many more than that. These included the Safer and Stronger Communities Fund, primary care trust funding, Connexions, Children's Trust funding and funding from bodies like Sport England. Some agreements included SureStart, Supporting People and drug prevention funding. Altogether, over £800 million of funding from central government was pooled or aligned.

11. On average partners in each agreement will now be reporting on 64 targets instead of the hundreds they had before. Take one example - Derby. Derby receives around 70 different funding streams from across central Government. All but 8 are now in the LAA. For these they had to report on over 600 indicators. Now that number is 72. So there are huge advantages in cutting through the bureaucracy, knocking down the walls between different agencies and focussing on what matters to people.

12. And that is not the only benefit already clearly emerging. The next great benefit is improvement in partnership working. The different statutory, voluntary and community agencies are improving their awareness and understanding of what each does in the area. And by doing that, they can share expertise, knowledge and access much more efficiently. Local partners around the country are reporting back to ODPM that even the discussion stage of an LAA has been a catalyst for a step change in partnership working, leading to the potential for greater joining-up and improvement to services.

13. So we're are seeing innovation and some ambitious thinking. I will just give a few examples from phase one. Derby is working with the regional RDA to share priorities and align funding. Bradford is bringing partners together to develop an action plan for dealing with young men with a record of anti-social behaviour. The plan will take a holistic approach to employability, skills levels, health issues, drug problems and other common problems. Brighton is developing what we call an 'older person's SureStart' to cluster services in two Neighbourhood Renewal areas. The aim is to reduce hospital admissions on the one hand and improve people's homes on the other. That's a win-win -a win-win for social services, a win-win for the primary care trust and, of course, a win-win for the older people themselves. It's also a win for the Government because it uses public money much more efficiently and effectively. There are many example being developed around the country.

13. That brings me to today and I am delighted to announce more details of the next phase. The first thing to say is that I am not talking about pilots - I am announcing the next stage of a national roll-out of LAAs. All the areas not included in this round will be only a year behind. We believe Local Area Agreements are the way forward and every area should benefit. And this is clearly a belief shared by the vast majority of councils and their partners. After the signing of the first agreements in March over three-quarters of the remaining areas of the country expressed an interest in being part of this next phase. Many of those that didn't express an interest this time around said they wanted to focus on strengthening their local strategic partnership first because the LSP is the driving force behind the LAA.

14. Today we are announcing in Parliament 66 more areas. That is over half as many again as the 40 we expected when we invited expressions of interest a few months ago. But again it reflects the enthusiasm - and momentum - behind LAAs. Now, of course, we had to have a limit and put through only as many as we deemed manageable in this round.

15. Again there is a complete mixture of types of area, and a mixture in records of performance. For example, later today I am visiting Walsall - one of the 66 areas chosen for phase 2. As you all know, Walsall has had its problems but this is a chance to recognise the progress that has been made there. Developing an LAA should provide even more impetus for improvement and I hope to hear about some ambitious ideas for their LAA this afternoon.

16. All the second phase areas should finish discussions and be ready for signing by April 2006. A third and final phase, for which all the 63 remaining areas will be eligible, should lead to agreements ready for signing by April 2007.

17. The sheer volume of work involved for Government Offices - and everybody else who is part of the discussions - always meant some areas were not going to be able to go ahead this year. However, there is nothing to stop those areas from working up and trying out some elements of what they would like to put into their LAA. That means they can hit the ground running next year. So my message to those areas is - keep the momentum going and take full advantage of the creativity and innovation being generated now.

18. So what's new in this next phase? First, we have added a fourth block focussing on economic development and enterprise. That results from the feedback we got from local government. Many of you said that was missing factor and indeed, economic prosperity is key to our goal of sustainable communities. This addition should help you get more interest from crucial partners such as RDAs, Learning and Skills Councils and JobCentre Plus. It's also welcome news that the Local Enterprise Growth Initiative, announced in the Budget, will be channelled through LAAs to stimulate enterprise in deprived areas. This will be worth £50 million in 2006/07 and is expected to rise to £150 million a year by 2008/09 when all the LAAs will be in place.

19. The second new aspect is that Local Public Service Agreements will be merged with LAAs to provide the incentive to stretch your targets where you face the greatest challenge to raise your game - and get the reward for achieving that little bit more. I know this means that a small number of areas not going through this time will have to delay the start of their LPSA discussions. That is an unfortunate consequence but on balance I think it's beneficial to do it that way.

20. The next 'new' development is that there will be considerably more single pot areas and we have learnt a great deal from Telford and the Wrekin. Single pots are particularly challenging for both central government and local partners, calling for a high level of trust and strong local leadership. But the opportunities for innovation and for delivering better services that people want are much higher and we want to build on experiences so far with this single pot and the 13 single pots in phase 2 will allow us explore it much further.

21. Finally we will be extending some of the basic elements of LAAs. We will continue to pool and align more funding streams, some on a case-by-case basis. Neighbourhood Renewal Funding, for example, will be pooled in LAAs. This highlights the importance of tackling deprivation and the central role that local strategic partnerships, through LAAs, can play in doing so successfully. We will also build in more freedoms and flexibilities where they remove barriers to delivery. The first phase made a great deal of progress in identifying these and removing many.

22. I know you will be hearing about the experiences of several first-phase areas during the course of the day. This is a learning process for everyone and the Office of Public Management is publishing a report today on the story so far of LAAs. We have taken on board many of the points they have made as part again of the more mature relationship, that shows that we have to have a spirit of openness so we can all share the lessons from the mistakes.

22. This is also reflected in the web-based toolkit we are publishing today to support local partners and Government Offices as they develop and negotiate their LAAs. What is set out is advice - not the 'be all and end all' of what should be in an LAA. Again I emphasise that each LAA should reflect the unique circumstances in the area. There is no identikit picture you have to match up to but I urge you to be ambitious and innovative.

23. Local Area Agreements are taking forward Government thinking on many fronts. Colleagues from across Whitehall have endorsed the approach and are co-operating fully in developing it further. One of the changes we've seen in the last few months is the emphasis on communities in ODPM. The Department now has two Cabinet members and that reflects not just our emphasis on communities and local authorities and partners working together for their communities, but it reflects our desire and need for the ODPM to better coordinate with other government departments to help you to do your job. So this really is an opportunity to deliver improved and more focussed services. The prize is proper integration of national services and local services at the ground level, where it matters. Not only does this make sense but I believe the agenda will make the difference in all our communities and help us deliver social justice and economic prosperity to people who we serve.

24. I think LAAs are common sense. I think they should have happened years ago and I think we should now get on with it.

Speech by Phil Woolas MP, 22 June 2005