One in three deprived areas locked out of ‘Levelling Up’ funding

More than a third of England’s most deprived areas will not benefit from the Government’s £4.8 billion Levelling Up Fund according to new Salvation Army research, released today.[1]

The report, Understanding People, Understanding Places is the biggest social mapping exercise in The Salvation Army’s recent history.

The findings show that while coastal and rural areas feature some of the highest levels of deprivation, these are also the areas most likely to miss out on Levelling Up investment.[2]  

The Salvation Army research analysed the local labour market in comprehensive detail and asked local people what they needed to find stable work. The Government’s Levelling Up analysis did not break the labour market into as much detail and also divided need up into larger areas which meant pockets of deprivation in otherwise more affluent areas were not prioritised.

The Church and Charity is warning that unless the Government rethinks how it calculates an area’s need, entire communities will be locked out of Levelling Up Funding and left to spiral into further poverty.

Understanding People, Understanding Places - key findings:

• The Government prioritised 93 areas to be given access to ‘Levelling Up’ funding but our report identified a further 45 in urgent need of investment.
• Salvation Army analysis shows a number of coastal areas around the country, including in the North West, Yorkshire and The Humber, East Midlands, the East of England and the South West, that should be high priority but were missed out of the Government’s calculations.
• The Government’s analysis of need was mainly based on unemployment figures, whereas The Salvation Army report analysed the local labour market in more detail. This highlighted how zero hours contracts, seasonal employment and shrinking traditional industries prevent people from finding stable and skilled employment.
• Lack of access to childcare was one of the key barriers to people finding work.
• The Government broke England down into 315 areas of which 93 were deemed a priority for funding. The Salvation Army broke the areas down into 345 areas and prioritised 116 areas as in most need of investment. 

As part of the Levelling Up Agenda and upcoming White Paper in the autumn, Government will be investing further funds into Local Authorities in the priority areas.  However, the Government has yet to set out exactly when and how that will happen.

The Salvation Army is calling on the Government to rethink how need is calculated to ensure that when the funding allocation process starts, investment is made in areas with the most need and invested in sustainable projects that will help people and communities to move out of poverty.  

Rebecca Keating, The Salvation Army’s Director of Employment Services, said: “The £4.8 billion earmarked for Levelling Up is a bold move by the Government and an opportunity to lift thousands out of unemployment but we are worried that this investment is missing many key areas in serious decline.

 “As well as analysing employment and income data, we talked to people to find out first-hand what people needed. Many people told us they have been stuck in low-skill seasonal jobs, which are now at risk following the pandemic but they are too old to easily access training courses to reskill. One of the most common issues are single parents faced with jobs offering wages that don’t cover the cost of their childcare.

“We want to encourage the Government to listen to the communities who need their help. Look up from the spreadsheet and see what we are seeing on the ground.

“Every day we work with people who are being pushed even further from employment as local businesses close, or they are trapped in a cycle of low-paid seasonal work and zero hours contracts. While there are similarities in the Government’s analysis of need and our report, there are too many areas of severe deprivation that have been overlooked. We must ensure investment reaches these people; it’s the only way to truly level up the country.”

The Salvation Army is calling on the Government to:  

• Reconsider how funding is allocated from the Levelling Up Fund, with coastal communities being recognised as an investment priority.
• Develop a new plan of investment in accessible childcare to allow people to access work and training opportunities. Recommendations include extending 30 hours per week of free childcare to 52 weeks, extending business rates relief for nurseries and providing additional childcare services to parents whose children benefit from the school Pupil Premium grant (4).
• Engage with communities to identify what investment will best ‘Level Up’ these areas. 
• Invest in skills and employment support; to help individuals out of low-skill, low-wage employment. 

[1] The Salvation Army identified 45 areas in England from their research report (of 116 areas) that should be included for ‘priority 1’ funding. This equates to 38%.

[2] ONS October 2020: Two in every three (67%) coastal towns are in the higher income deprivation category (including the higher deprivation towns shown in the “other” category) compared with just over one in every three (36%) non-coastal towns. Overall, over 3.8 million out of the 5.4 million who live in coastal towns in England and Wales live in one of the 114 higher income deprivation towns.