Levelling up: More than 90% of funding not yet spent

The UK government has spent less than 10% of its £4.8bn fund for levelling up since its launch in 2020, according to official figures.

The figures, obtained by the Labour Party, show £392m has been spent from the fund as of last month.

The fund awarded £1.7bn to projects in October 2021 and another £2.1bn in January 2023.

The levelling up department said it had "always been clear that councils will receive funding over time".

It added that money from the fund's latest spending round, allocated in January, is due to be spent over "at least three financial years".

It is part of the wider levelling-up idea, which aims to reduce economic opportunity between different regions by improving transport, education and broadband.

The term, coined by former Prime Minister Boris Johnson, was a central theme of the Conservatives' pitch to voters outside London at the 2019 general election.

Labour submitted a freedom of information (FOI) request to ask the government to confirm how much of the £4.8bn allocated to the fund had been spent.

In its response, the government said a total of £224m had been spent as of 18 January 2023, with that figure rising to £392m by 22 February.

Shadow levelling up secretary Lisa Nandy revealed the figures as MPs put questions to government ministers in Parliament on Monday.

She compared the cost of the government's decision to give high earners pension tax breaks in the Budget earlier this month to the money it had spent on levelling up.

Ms Nandy said: "They can get their act together when it comes to the 1%, but when it comes to investment in our local transport, decent housing, even on delivering on a single one of the levelling-up missions, why is it that the rest of us always have to wait?"

The Liberal Democrats said the government's levelling up plans "are a shambles"."Ultimately the buck stops with Michael Gove, he has overseen a systematic failure to provide much-needed funding to dozens of communities across the country," the party's local government spokesperson Helen Morgan said.

But Levelling Up Secretary Michael Gove defended the government's record, arguing that Chancellor Jeremy Hunt had made sure millions of pounds would be spent in his Budget.

In a statement, his department said Labour's figures included money from the next - third - spending round, which has not yet been allocated.

It said money from the fund's first spending round, allocated in October 2021, was due to be spent by March next year. Money from the second round is due to be spent by March 2025, it added.

"The Levelling Up Fund will transform communities right across the country with £4.8bn spent over several years, but we have always been clear that councils will receive funding over time and payments are made every six months," a spokesperson added.

To receive money from the Levelling Up Fund, local authorities can apply for money from the UK government to pay for infrastructure projects. The fund has awarded £3.8bn to 216 projects in total over two rounds.

A total of 111 areas were awarded money from the second round in January this year, including £50m for a new train line between Cardiff Bay and Cardiff Central Station and £27m for a ferry in Shetland.

The North West of England got the most money in both rounds of funding.

The government has confirmed there will be a third round of the Levelling Up Fund, although no further details on when this will open have been published.

But some politicians have complained about the process for allocating the money.

Andy Street, the Conservative mayor of the West Midlands, has criticised the funding process, calling it a "broken begging bowl culture".

He suggested the money would have been allocated better by local decision-makers than civil servants in London.

London Mayor Sadiq Khan has said "levelling up adds little value to London communities" and called the process for allocating funds "an unmitigated disaster".

Labour has said it would end the "competitive-style bidding" process but would not cancel projects that had already been approved.

Prime Minister Rishi Sunak has argued the most deprived areas would benefit from the money.

In January, Mr Sunak said his government was committed to levelling up "across the UK" and denied politics had influenced the allocation of funds."I think around half the funding we have announced over the course of today, or both funds, has actually gone to places that are not controlled by Conservative MPs or councils," he said at the time.