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An investigation by parliament’s spending regulator into how ministers distributed £ 3.6bn to help underprivileged cities has raised serious concerns that funding decisions were politically biased.
The multi-party public accounts committee said it was “not convinced of the reasons for selecting some towns and not others” when the township fund was distributed by the Ministry of Housing, Communities and Local Government (MHCLG) last year.
The justifications offered by ministers for selecting individual cities were “vague and based on general assumptions” and raised concerns about politically motivated decisions, the committee said.
The highly critical report comes after Communities Secretary Robert Jenrick earlier this year denied playing any role in selecting his constituency, Newark, for a £ 25 million grant under the scheme, despite having bragged about it during the general election last year.
Jenrick said the award had been signed by then-minister of communities Jake Berry, while he had approved a grant for Darwen in the Berry constituency.
Meg Hillier, chair of the committee, said the system gave “every appearance of being politically motivated.”
“MHCLG must be open and transparent about the decisions it made to deliver those billions of pounds of taxpayer money and what it hopes to deliver,” he said.
The plan was originally launched ‘in pace’ in July 2019 to support England’s struggling cities.
Department officials then drew up a ranked priority list of 541 cities based on need and development potential for ministers to select.
While the top 40 “high priority” locations were confirmed, ministers then selected a further 61 “medium and low priority” communities from the rest of the list, including one that ranked 536.
Although the department was supposed to record the “justification” for choosing some cities and not others, the committee said it was “not convinced” for some of the reasons given. “The selection process was not impartial,” they concluded.
The committee also complained that the reasons given by the department for not releasing more information about the selection process were “weak and unconvincing.”
He said concerns had been raised by press releases that erroneously claimed that the National Audit Office had concluded that its procedures were “sound.”
While the department’s permanent secretary, Jeremy Pocklington, said he was satisfied with the “propriety and regularity” requirements, the committee said he was “disappointed” that a summary of his evaluation had not been published.
“This lack of transparency has fueled allegations of political bias in the selection process and has put at risk the reputation of integrity and impartiality of the public administration,” he said.
The MHCLG responded to the report with a statement rejecting the main findings. A spokesperson said: “We completely disagree with the committee’s criticism of the City fund selection process, which was thorough, robust and fair.
“The fund for cities will help level the country, creating jobs and building stronger and more resilient local economies.”
