South West RDA will be spending £56m less than budgeted in the next two years as a result of the recession and pressures on funding.
Much of the RDA’s activity is in support of economic activity in Devon, Cornwall and developing areas of the South West, but it has budgeted around £3m towards the now delayed regeneration of Swindon’s town centre.
Now worth £260m over two years, the regional targeted investments will “drive the region’s economy and help businesses, communities and people to prosper.” the RDA said.
However,Government initiatives to support the national economy, such as Homebuyer Direct, had introduced further reductions of £26m in our budget during this year and next.
“In common with other holders of development assets, the recession has affected our ability to raise funds through selling investments and developments, and securing rent from other assets. Over the two years we expect this to mean a further £30m reduction.
“We now expect to be approximately £56m worse off over the coming two-year period.”
In response to these pressures on its budget, the RDA has had to scale back its total investment compared with the plans it made a year ago.
“In some areas the RDA has had to take tough decisions to reduce or withdraw from some planned projects, and will work with stakeholders in these areas to minimise the impact of these changes,” a spokesman said.
Jane Henderson, Chief Executive of the South West RDA, said: “Like most businesses and families throughout the region, we have had to tighten our belts and will not now be able to fund all the investments we hoped we could.
“None of these choices has been made lightly, and we regret the disappointment that will be felt by some of our partners and stakeholders in having to scale back our investment activity.
“Given limited resources, we have our sights firmly focused on doing the things that are most important for ensuring that the South West comes through the recession in the best possible shape to succeed as a dynamic, sustainable and thriving regional economy.”
The announcements are the results of a capital budget review that the RDA initiated in March.
Agency staff were meeting partners and stakeholders to explain the impacts of these investment decisions.
