The Mayor of London has been given a £130 million annual funding boost by the Treasury to aid economic development in the capital
Following months of delay, Boris Johnson can finally give the green light to a number of projects that were previously supported by the axed London Development Agency.
But the funding package falls significantly short of the £480 million-a-year previously committed to London’s economic development, leaving an overall shortfall of more than £1 billion.
Fears have increased that cuts to the funding will lead to projects being axed that would have provided jobs for young people in the capital, and critics of the Mayor are likely to suggest he took his eye off the ball with regards to economic development at a time when it needed his attention the most.
It has not been stated which projects have been given the go ahead and which are set for chop but it is thought that some of Johnson’s pet projects, including supporting mentoring groups, skills training and promoting volunteering will be spared the axe.
Previous story (28.02.11)
LDA set for massive budget cuts
London Development Agency’s (LDA) could be decimated by a massive cuts plan being considered by city mayor Boris Johnson.
Johnson has announced he wants to slash the agency’s regeneration fund from its current £41 million to just £17 million for the year 2011-12 - depending on how much cash he is given by the Treasury before the end of next month.
Its £30 million ‘sustained employment’ fund may be cut to £19 million, and its cash for supporting businesses is likely to be cut by more than half, from £26 million to £12 million.
The agency’s budget for tackling climate change may not be immune either. The mayor wants to take £5 million from its £20 million pot. Its budget for ‘international promotion’ may also be slashed, from £27 million to just £7.4 million.
Only money to pay for the Olympic Games is being increased, by a massive 250%. Its £4.1 million pot for 2010-11 will be boosted to £14.3 million for 2011-12.
The mayor’s budget document said: ‘This increase is due to additional projects being classified in this theme some of which previously came under the sustainable employment budget.’
Regeneration accounts for a greater proportion of the agency’s total 2011-12 expenditure (19.9%) than last year’s (19.6%). A spokeswoman for the mayor insisted the budget document is merely indicative, not final. The document reads: ‘The mayor is yet to receive a grant settlement from Government for the LDA in 2011-12 and remains in active discussions with ministers. Once these discussions are concluded and a settlement agreed, the mayor will be updating these budget plans as they relate to LDA functions.’