Regional Development Agencies 'boosting the economy'

Regional Development Agencies (RDAs) are providing a real boost to the economy, according to new research for the Government.

A report by PriceWaterhouseCoopers (PWC), commissioned by the Department for Business, Enterprise and Regulatory Reform (BERR), found that every pound invested by RDAs generates at least £4.50 in the regional economy.

This figure was calculated according to the expected persistence of the benefits of RDA programmes, which, according to the report, have created and safeguarded nearly 213,000 jobs and helped create over 8,500 businesses since 1999.

The research shows that the total annual expenditure of the UK's nine RDAs increased from £825 million in 1999/2000 to £2.3 billion in 2006/2007, with 17% of this being spent on business development and competitiveness.

However, the South East England Development Agency (SEEDA) this week announced that it may have to cut around 90 jobs due to the reallocation of Government funds brought about by the recession.

A statement from SEEDA read: "Funding for Regional Development Agencies has been redirected towards measures to help businesses and home-buyers survive the downturn and our budgets are reduced further as we will not now earn expected capital receipts from sale of land and properties."

"As a result, we have about £50m less than we expected to invest in our programmes over the next two years."