Following the announcement that 55 projects will receive a share of the remaining levelling up funding, Mark Bandalli considers some of the challenges these projects face and the lessons from supporting Round 1 and 2 projects.
The news that LUF round 3 funding was being provisionally allocated to a selection of projects that unsuccessfully bid during round 2 took many by surprise. While this approach has its advantages, primarily avoiding the need to undertake another round of resource and time intensive bid development, it also presents some challenges.
LUF round 2 bids were submitted over a year ago. For some, the situation on the ground will have changed completely (e.g. thinking may have moved on to other priorities or earmarked land etc. may no longer be available). But for every single one of these projects, the assumptions that underpinned the initial propositions will need to be reviewed and most likely amended. Higher interest rates, ongoing inflationary pressures and difficulties in engaging with suppliers who are facing their own pressures will all play a part - not to mention the widespread council budgetary crisis and the multiplier effect the cost-of-living crisis is having on communities and local businesses. The desirability, viability and deliverability of these year-old ideas cannot be assumed.
Each local authority provisionally awarded LUF Round 3 funding is required to complete a validation and onboarding process. While the details of this process aren’t currently known, it is likely that this will focus on some or all of the considerations set out above.
Once the validation process is complete, there are important lessons from earlier funding rounds that these 55 councils should consider as they look to mobilise their projects:
1. The challenge of establishing momentum
Given the uncertainty regarding the timing (and for most the complete surprise) of the award process, it is understandable that councils may not be ready to get going. Councils we have supported in previous funding rounds have described the need to move from a standing position into a sprint in a matter of weeks.
Putting a project manager in place to oversee early mobilisation is critical - the benefits of having at least one person responsible for establishing the necessary arrangements, co-ordinating stakeholders and progressing with early mobilisation activities were clear to those councils who moved quickly to fill that position. Establishing the core project team as quickly as possible, with the people who possess the right skills and capacity, is also key.
2. Making the project a priority
Delivering the project is likely to require input from a range of internal and external stakeholders. A useful way of getting those involved re-familiarised with the contents of the bid is to hold a round table meeting to review the commitments, arrangements and objectives. Variance from the original bid can be discussed and understood, while the process of pulling the wider delivery team together is a helpful way of establishing relationships and allowing challenges, risks and issues to be discussed early on. Generating widespread enthusiasm and commitment to the objectives of the project is important.
3. Establishing the project management infrastructure
In addition to appointing a project manager and project team, it’s crucial to create or update important project documentation. Your delivery plan, financial model, risk log, communications plan and benefits realisation plan are important project documents that will help to organise, prioritise and monitor progress, while providing important information to inform the quarterly project monitoring reports. It may feel a bit dull but putting the effort into this at the start will make life a lot easier and avoid playing catch up further down the line.
4. Designing and establishing project controls
Successful councils will be required to sign a Memorandum of Understanding with the department (DLUHC), which sets out the purpose of funding, financial arrangements, monitoring and evaluation requirements etc. Additionally, each recipient is required to ensure that the necessary arrangements are in place to meet legal and statutory obligations, including compliance with procurement, financial and subsidy control rules. Each council will likely have their own policies and processes in place. Before the project fully mobilises, it is important to establish arrangements that will ensure the project complies with council and DLUHC requirements.
5. Getting the project’s governance right
The project’s governance structure will have been detailed within the bid. This will need to be reviewed as the lay of the land may have changed and people earmarked for specific roles may have moved on. Most councils tend to make use of existing governance arrangements where possible. Confirming governance arrangements, for example amending existing Terms of Reference to reflect each tier of governance’s remit, roles and responsibilities in relation to the LUF project, is a helpful early step. Internal oversight and scrutiny arrangements and timescales can then be formalised.
6. Prioritising tasks with the most significant lead times or highest level of perceived risks
Identifying areas of project activity with the most significant lead times is a useful process, as these can then be prioritised during the early months of the project. Examples include preparing for procurement exercises, planning applications and consultation exercises. In terms of procurement exercises, several councils highlighted the importance of reassessing supply chain availability and resilience.
7. How affordable is the asset’s legacy?
Considering how the project will be funded once operational is an important consideration. Understanding all of the costs and liabilities associated with maintaining the asset and delivering the intended services is an important consideration. Should funding shortfalls be identified, work to bridge the gap (reviewing the revenue models or considering how the asset will be used etc.) should be undertaken as early as possible.
Receiving external funding for a cherished local project is fantastic news and you should be delighted if you are one of the lucky ones - many have been disappointed. Councils that have made good progress delivering their LUF projects have one thing in common - they placed a real emphasis on getting the basics right during project mobilisation.
If you are interested in an informal chat to hear more about our approach or to discuss your local projects, get in touch with Mark at mark@mutualventures.co.uk.
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