£20m pot to help boost economy

editorial image

Calderdale Council is one of seven councils to collectively put close to £20 million into a multi-million pound fund aimed at kick-starting key areas of the region’s economy and creating jobs.

The fund will support schemes which might have secured loans in the past but now struggle to get support because of the more cautious approach by banks and other commercial funders.

While it will be open to a range of potential investments, housing and construction projects are expected to feature prominently.

Calderdale, Bradford, Harrogate, Kirklees, Leeds, Wakefield and York are in line to put money into the fund, which will operate under the Leeds City Region banner. It is thought a further £60 million of private sector investment will be unlocked.

Tony Reeves, chief executive of Bradford Council and lead Leeds City Region chief executive for infrastructure and investment, said: “A first phase of the Leeds City Region Investment Fund is intending to be launched shortly with a second phase later in the year.

“Details of the first phase launch are being finalised but it is likely to be an initial £10m to target key investment projects where supplementary funding is needed to enable commercially viable projects to proceed.

“This will complement the existing £56m investment the City Region is already investing in supporting businesses to grow and create new jobs.”

Rather than offering grants or subsidies, the Revolving Investment Fund will provide loans on a commercial basis with returns going back into the fund so it grows over time and can support more projects in the future.

Private sector partners will be expected to invest £3 for every £1 put in by councils, potentially paving the way for investments worth £80m to get off the ground in the coming months.

Projects will have to show how they have an impact through new jobs, adding to the regional economy or by helping broader goals such as supporting the growth of low carbon industries.

Peter Box, Wakefield Council leader and chairman of the Leeds City Region leaders board, said: “We’re bringing forward this initial tranche of our planned investment fund to help kick-start development that is being held back due to a lack of commercial financing.

“As well as addressing a key market failure, the revolving investment fund will bring more much-needed investment into the City Region alongside our business funding programmes, financing for apprenticeships, skills and broadband, and the significant transport funding secured through our city deal.”

The fund will lend sums of more than £1m and expects to recover its investment within five years.

The councils taking part believe that by pooling their money they can have a bigger impact that brings benefits across their areas and make it easier to engage with the private sector.

The Revolving Investment Fund is part of a wider effort by Leeds City Region councils to make funds worth around £400m available to invest in key parts of the area’s economy.

Senior councillors are due to sign off contributions to the fund this month with a formal launch expected in July.