Regional Growth Fund for large businesses
For specific information see also:
Small and medium sized enterprises may be interested in:
The Regional Growth Fund (RGF) is a £3.2 billion fund, helping companies throughout England to create jobs between now and the mid-2020s. The payment of Regional Growth Fund money is spread between 2011 and 2017. Regional Growth Fund supports projects and programmes that are using private sector investment to create economic growth and sustainable employment.
The Regional Growth Fund is a competitive fund and has a minimum bid threshold of £1 million.
The June 2013 Spending Round allocation made a further £600 million available for bids in Rounds 5 and 6 of the Regional Growth Fund.
Round 5 is now closed to bids.
Bidders should now have received confirmation of receipt of their bids. If you have not been contacted please email email@example.com.
Selected bidders will be announced in Spring 2014.
Round 6 of the Regional Growth Fund will be launched in the summer of 2014, giving companies unable to apply for Round 5 an opportunity to bid.
Round 5 - Bids now received
133 bids have now been received with a total ask of £650 million.
Received bids from Round 5 are set out regionally below:
Round 5 - Bidders by region
|Region||Projects and Programmes||RGF(£m)|
|Yorkshire and The Humber||10||(8%)||25.6||4%|
Assessing the bids
When bidders submit an application, their bid is subject to an economic appraisal to consider a range of value for money factors. Anchaired by Lord Heseltine, recommends to ministers which bids government should support (see ).
The Deputy Prime Minister, Nick Clegg, chairs the Local Growth Committee, which meets to discuss the recommendations and agrees which bids to select for Regional Growth Fund support.
Once a bid has been selected, the bidder works with the Regional Growth Fund team to complete a due diligence process to agree the terms of the support Regional Growth Fund can provide, and to provide assurance that the project or programme can be delivered.
Not all selected bidders will complete due diligence and take up their offer of funding. Some will choose to withdraw; this is a normal part of a competitive funding process where due diligence checks are made after selection.
Bids will be judged on how well they create sustainable jobs and will be assessed against 5 criteria:
- project location
- sustainable private sector growth
- value for money
- State Aid compliance
The data used to assess the locations that bids will impact are listed below:
- percentage of residents (aged 16 to 64 years old) claiming out of work benefits
- public sector employee job share
- private sector employee job growth
- number of active enterprises per 1,000 resident population
Round 5 funding will need to be drawn down in arrears of private investment by 31 March 2017, but projects or programmes can last longer.
Bids must provide a minimum of 1:1 ratio private sector contractible match-funding which is not recycled from public sector grants. However as this is a competitive fund, the expectation, and experience of previous rounds, is that this ratio will be higher.
European Regional Development Fund (ERDF) funding can be used to support bids but must not replace private sector match-funding requirements.
What’s different about Round 5?
Round 5 has been almost exclusively centered on capital funding. This means competition for funds for training or research and development process has been especially strong. Therefore capital projects stood a greater chance of success.
State Aid changes
Grant or loan support to private sector undertakings will almost always be regarded as State Aid and therefore must be compatible with European Union rules. The Regional Growth Fund is a notified aid scheme with the European Commission, and the majority of the support we provide is given under the General Block Exemption regulation (GBER), which is currently under review as part of a wider modernisation of State Aid rules.
A range of new State Aid rules will come into force from 1 July 2014. These will replace existing General Block Exemption Regulation (GBER), Regional Aid Guidelines (RAG) and the Assisted Areas map for the UK.
Bidders to Round 5 should have considered whether their bid is compliant with the new Regional Aid Guidelines and Assisted Area maps, as well as the regulation which replaces General Block Exemption Regulation, because Regional Growth Fund offers made from July 2014 will be made under the new rules.
Where possible, we propose to fast-track Round 5 bids that would benefit from their awards being made under the existing State Aid rules. These awards will need to be finalised by 30 June 2014. Bidders should have helped us identify such bids.
Selected Round 5 bids that will not be adversely affected by the new State Aid rules will be contracted by early October 2014 under the new rules.
BIS is working with the European Commission to agree the new boundaries for Assisted Areas. We expect these to be agreed 1 or 2 months before taking effect on 1 July 2014.
Exceptional Regional Growth Fund
Ministers reserve the option to use Regional Growth Fund funding flexibly in order to respond quickly to economic shocks and opportunities. This will be in exceptional circumstances only, and will take place outside the normal bidding process. Applications for exceptional Regional Growth Fund support will be subject to the same level of appraisal, including independent scrutiny. Where support is granted due diligence is still required.
Organisations interested in exceptional Regional Growth Fund should first approach the government department that manages their sector relationship. Departments will determine what other sources of support might be available before considering applying for exceptional Regional Growth Fund.
For further information see Questions and Answers on Exceptional Regional Growth Fund (eRGF) support.
Regional Growth Fund National Audit Office (NAO) report update
The NAO report rightly recognises the steps we’ve taken to strengthen RGF by improving its governance and getting money into the hands of businesses more quickly to support economic growth.
RGF is working. Over £2.6 billion of RGF investment has now been allocated to 400 local projects and programmes which is unlocking nearly £15 billion of private investment and delivering 550,000 jobs. RGF programmes amongst these awards have supported over 3,000 SMEs.
RGF money is drawn down by businesses at the rate agreed with Department of Business Innovation & Skills (BIS) that is right for their projects. If we had pushed money at businesses faster than they wanted it, government would have been rightly criticised and in breach of Government Accounting Rules that forbids funding ahead of need. The NAO has actually praised the assessment process applied to each bid for support, and the rate at which funds are issued are a product of that process.
The challenge we face in the coming financial year - our peak year budget-wise, with a £1.4 billion budget - is to ensure grant recipients stick to their plans, achieve the milestones we have jointly set and draw down funds at the predicted pace. We have an excellent team of monitoring officers across England who are working with businesses to ensure this happens.
For further updates please follow the RGF twitter account at https://twitter.com/RGFGrowthFund
If you have further queries about the Regional Growth Fund, contact us at firstname.lastname@example.org.
Department for Business Innovation and Skills Local Offices
Please only call the below numbers if you have a local enquiry - otherwise contact the Regional Growth Fund Team at email@example.com.
- North West: 0161 2610350
- Yorkshire and Humber: 07798 675138
- North East: 07825 841835
- West Midlands 0121 345 1228
- East Midlands 0115 8724736
- Central and South West: 07990 692252