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7/29/2019 The economic impact of LEADER in England
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www.lincoln.ac.uk
The economic impact of LEADER in England
Gary Bosworth, Ivan Annibal, Terry Carroll,
Liz Price, Jessica Sellick & John Shepherd
Regional Science Association, Cambridge August 20th -22nd, 2013
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Focus for Research
The analysis focuses on the extent to which
LEADER has enabled activity that would
otherwise not have been possible and the
scale of resultant local multiplier effects.
(A separate paper at the European Rural Sociologyconference considered governance and wider rural
development objectives)
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The LEADER
Philosophy
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1
LEADER I (199193)
217 LAGs,442m budget
Confined to objective 1 areas
Pilot programme themed around area partnership networking
2
LEADER II (199499)
906 LAGs (21 in England),1,755m budget
Extended to include Objective 5b areas
Measures available: skills, innovation and transnational co-operation
3
LEADER+ (200006) 893 LAGs, rising to 1,143 in 2004 (25 in England),2,105m budget
Extended to any rural areas
Structured around 3 actions heavily focused on innovative pilot schemes and both local andtransnational networking and cooperation
4
LEADER Approach (2007-13)
LEADER is mainstreamed within the overall EU rural development policy 2,308 LAGS (64 in England),5,500m funding from within the overall rural development
finances received by member states under EAFRD
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Rural enterprise support needs
Rural enterprises can be more resilient (Anderson et al 2010), have higher
growth rates (Keble and Tyler 1995) and support wider communitywellbeing (Bosworth 2012)
Agarwal et al. (2009) discovered that higher productivity in rural firms
depended largely upon three sets of factors: enterprise and investment;
accessibility and road structure; skills and education.
Broadly speaking, these make up innovative capacity (Stephens andPartridge, 2011, p458), which tends to be stronger in more urban areas,
and is seen to be critical for the success of entrepreneurship programmes.
All endogenous in nature highlighting the need for locally-based
interventions regional economies cannot be manipulated by
interventions that assume the same drivers will lead to the same
outcomes in different areas (Kitson et al. 2004)
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Delivering micro-enterprise support Lower population and business densities in rural areas make it more
expensive to deliver business and training support than to comparableurban firms (Bennett and Errington, 1995; Smallbone et al, 2003).
However, if the aims of intervention take into account non-economic
outcomes, approaches such as LEADER become more potent.
Previous evaluations of LEADER have indicated that Value for Money in
terms of business support has been relatively low (Ekosgen, 2010) and jobcreation rates were modest (Ekosgen, 2011).
On the positive side, reports emphasised the importance of LEADER in
diversifying farm enterprises (Carnegie UK, 2010), supporting new value
chains (Metis et al., 2010) and providing community facilities (Ekosgen,
2010).
Furthermore, the deadweight was much lower than the government
benchmarks indicated that a lot of projects were supported that would not
otherwise have happened (Ekosgen, 2011).
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Rural Entrepreneurship characteristics
Risk takingfinancial, social, uninsurable
Innovation including creativity and
technology adoption
Perceptiveness alertness to opportunities
and the vision to make them happen
Personal motivation independence, drive,profit orientation, social motive?
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Methodology
A review of literature and other LEADERevaluations
Questionnaire sent to a range of rural
stakeholders - generating 549 responses Interviews with a combined total of 83 key
stakeholders and beneficiaries in selected LAGs
Two workshops to test our findings with keypersonnel in LEADER policy and delivery roles.
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Typology of LAGs
The basic criteria for sampling case study LAGs comprise:(a) topography
(b) RDPE Axes and Measures
(c) the proportion of programme budget spent
With the detailed boundaries for the LAG areas this was also
the first time that other data could be mapped at this level
this included population, rural settlement, IMD 2010, state of
the economy (JSA data etc) and economic structure basedupon IDBR data.
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Solway
Cumbria
Shropshire
WorcestershireHerefordshire
East Cornwall
Clay Country
West Cornwall
North Lincolnshire
Coastal Action Zone
Lindsey Action Zone
Wash Fens
Northumberland Uplands
North Pennine Dales
West Kent
Kent Downs and Marshes
Surrey Hill
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Summary of findings LEADER is arguably unique in terms of the diversity of projects funded and
impacts:
- Recruiting and developing volunteers, often exceeding contractual targets
- Job creation in microenterprises and public sector organisations, again withmany having already created or expecting to create more jobs than contracted.
- Funding in the tourism sector helps to overcome seasonal unemployment
- Building valuable connections within the local economy, including schools,
policy organisations and wider local communities- Facilitating innovative partnerships and business models
- Restoration of old/redundant buildings
- Investing in environmental friendly methods
- Supporting the rural visitor economy
- Providing skills, training and apprenticeships Each of beneficiaries also recognised that they either would not have been able
to deliver the project or that it would have been on a smaller scale or takenconsiderably longer without the support that they received.
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Beneficiaries views on LEADER
Microenterprise
Public Sector/
Community
Group
Social
EnterpriseMEAN
LAG Support 4.91 4.60 5.00 4.84
Forms 3.82 3.20 3.75 3.59
Overall Process 4.05 2.65 3.00 3.23
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Attitudes and motivation
Ive always been anti-grant, thought it was a waste
of taxpayers money going to the wrong people Itwas a lot of effort for the amount of money but Iwould do it again
It is a learning process it can be challenging for a
creative thinking entrepreneur
Morale boostingsomeone cares about smallbusinesses
Where entrepreneurs did consider funding, therewas often a trade off between the value of the grantand the time invested in applying.
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Awareness of LEADER Application and communication methods vary between LAGs
Many beneficiaries became aware through existing policy networks or direct
approaches from the LEADER team, this arguably made it more difficult for
businesses to gain access.
- We have a good relation with *the District Council+, the economicdevelopment side at leastshe told us about it and started it off (countrypark, Lincolnshire)
- We were referred on to LEADER through other links with the Council(community shop, Herefordshire)
- Mr A was aware of the Leader programme and was/is a member of theWest Kent LAG (farmers joint venture, Kent)
- I had previously approached the Leader staff at Cornwall Development
Company about something else, and kept in touch with them. Theyapproached me to see if we had a project (pottery, Cornwall)
In Kent, a range of sources including the Produce in Kent organisation, land
agents, farmer networks and the National Trust were all mentioned
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Larger scale example - Lakeland Eggs
Good practice on animal welfare
Energy generation They will be carbon neutral by the end of the year.They plant trees for chickens to roam in, and also use them for wood chip
Education will have delivered 400-500 training days from a target of 80
days
Local food supply chain working with 50 farms in Cumbria out of 3-4,000
Without LEADER funding, we would have been a good egg factory but not
leading edge. They have won two national business awards for business
innovation and business in the community and as a result people want to
be seen to be working with them.
Were being noticed because we do things differently
Innovations include marketing and communications e.g. trace your egg,
robotic packing, solar power, rainwater harvesting, geothermal heating
Their scale of packing supports local farmers to access national suppliers
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Innovation
Collaboration raised credibility and profile overseas which in
turn raised confidence and aspirations (Lavender growers) Wood-fuel cluster
Showcase for new technology
Transformed a Charitable Trust (with village hall mentality)
into a financially viable limited company. Needed a robustbusiness plan and support for staff/volunteers to adapt to the
demands of operating a modern and versatile public facility
in a competitive commercial environment
New community enterprises and alternative business modelssupported to become sustainable
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Perceptiveness
Engaging in LEADER raises opportunity evaluation and
business planning skills . Its not simple or straightforward but it made you think in a
positive way edifying and educational
A farm shop operator rethought the whole business
strategy...confidence to employ a new full time member ofstaff...now has new plans for green energy production on the
farm
Building business networks including public sector
organisations raises exposure to new opportunities May be self-selecting of perceptive business owners though?
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Economic impacts The grants were instrumental...it is unlikely that other sources of
funding would have been so flexible or supportive Weve taken on 2 new staff who work 4 days a week. Before, we had
to use freelancers and apprentices. We couldnt have done thisproject without Leader funding...weve needed the extension for acouple of years and just couldnt fund it...it would have taken us much
longer to get the finance in place, another couple of years at least. You get more value in rural areas creating one or two jobs makes a
difference whereas that money wouldve been lost in a bigger town
Volunteering and training raise human capital in the local economyand often contracted targets are exceeded
These may not be examples of large-scale risk taking, but bringingforward development during recession and making a difference inlocal communities are significant impacts from the programme anddo we really want risky entrepreneurship in smaller rural economies?
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Barriers to success
Delays in the system one applicant became ineligible as theygrew beyond 10 FTEs during the application process
Trade off between time to apply and comply vs financial
income. Especially challenging for those not familiar with
public sector methods and jargon
Arrears payments
Evaluation does not capture all of the value, especially value
generated beyond the funding period.
Displacement effects e.g. too many microbreweries funded The need for 3 quotes
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Concluding thoughts
Awareness of LEADER among businesses is patchy
While LEADER funding has made a difference to many microenterprises, itoften brought forward planned developments rather than stimulating new
activity but once engaged, new opportunities emerged and business
outlooks changed.
Impact is small in terms of jobs created and GVA but it can make a
significant difference to very local areas.
The administrative burden is off-putting for many businesses, especially if
they are unfamiliar with grants and policy processes.
Where rigorously enforced, specific rules also created problems for
beneficiaries. More efforts should be taken to generate local multipliers and avoid
displacement effects
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Thank you
any
questions?
The report can be downloaded
from Defras website:
http://randd.defra.gov.uk/Default.
aspx?Menu=Menu&Module=More
&Location=None&Completed=0&P
rojectID=18472