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First stage of the £4bn Levelling Up Fund unveiled as part of Budget

03 Mar 2021 News

Fergus Burnett

As part of today's Budget announcement, the chancellor launched the first stage of the £4bn Levelling Up Fund, but has not included charities on the list of potential stakeholders.

Local authorities have been invited to work with groups in their area and develop bids of up to £20m for projects focused on improving transport infrastructure, regenerating town centres, and maintaining cultural assets.

Charities are not included on the list of potential “local stakeholders” published in the fund prospectus, which was released this afternoon after the budget announcement.


The prospectus confirmed that the government plans to spend £4bn on projects in England by the end of this parliament in 2024, with a further £800,000 in Wales, Scotland and Northern Ireland.

It recommends that local authorities “consult a range of local stakeholders across the full geography of a place in developing their proposed investments for the fund”, and lists potential stakeholders as “local businesses, public transport providers, police and emergency services, community representatives, environmental representatives and universities and FE Colleges”.

Managed from Whitehall

Every local authority will receive £125,000 to help cover the costs of developing bids, with councils in the most deprived parts of the country prioritised for funding.

The Levelling Up Fund will be managed centrally by three Whitehall departments – the Treasury, Department for Transport and the Ministry of Housing, Communities and Local Government – which will make decisions on successful bids.

Funding of up to £20m will be available for successful bids, rising to £50m for the most ambitious transport initiatives.

The prospectus suggests cultural projects could include "maintaining, regenerating, or creatively repurposing" museums, galleries and associated green spaces, while transport initiatives could include "improving the experience of transport users". 

One suggestion for a regeneration project is to "bring public services and safe community spaces into town and city centres". 

Priority for projects delivering this year

Bids for the first phase of funding will be most likely to succeed if they can show they will start delivering projects during this financial year, according to the prospectus.

It also advises areas to gain the support of their local MP for the bid, although MPs will not have the power to veto or approve projects for funding.

Matt Whittaker, chief executive of the think tank Pro Bono Economics, said that it was essential the fund helped communities as well as local economic infrastructure.

He said: “If the government hyper-focuses on physical infrastructure at the expense of social infrastructure, it won’t achieve the levelled-up UK it wants. 

“It’s key that the new Levelling Up funds give the right consideration to both communities and dual carriageways when grants are being made.”

Community Ownership Fund

The chancellor also used the budget to announce that community groups will also be able to apply for £250,000 in match-funding to take over derelict assets from this summer.

The £150m Community Ownership Fund will provide the match-funding for local groups who want to buy or control assets which will otherwise fall out of use, such as pubs, sports clubs, theatres and post office buildings.

The funding could rise to £1m in exceptional circumstances, according to a statement from the Treasury.

The think tank Onward recommended this sort of scheme in its The Policies of Belonging report earlier this year, and it was also backed through campaigns by Locality and the community business funder Power to Change.

The Treasury statement said: “There is evidence that assets and facilities of this variety can be successfully and sustainably brought into community ownership. 

“This both enables people to continue to benefit, and empowers communities to shape the things that matter most to them. 

“However, it can be hard for community groups to raise the initial funding required to buy the asset. The Community Ownership Fund will help enable community groups to overcome these barriers.”

Power to Change: Fund must have impact

Vidhya Alakeson, the chief executive of Power to Change, said that the Community Ownership Fund was “an incredibly important step towards levelling up the country after the pandemic” but warned that funding needed to be about more than “just bricks and mortar”.

She said: “Our research tells us there are hundreds of communities across country waiting to breathe new life into all manner of spaces: vacant land, historic buildings that have fallen out of use, or community centres in need of a new purpose. 

“With property vacancy likely to increase, the fund is recognition that community ownership is one of our most important regeneration tools. But if this fund is to succeed, it’s vital that it goes beyond funding just bricks and mortar. 

“Having supported more than 1,000 communities to manage and own local buildings and green spaces, we understand the challenges they can face. 

“Therefore, it’s essential the fund provides the additional support needed to make these assets viable into the future, from feasibility assessment to contingency funding. 

“Without this accompanying support, the fund is unlikely to have the impact we, or government, would hope and therefore it’s essential it is for the government to draw on the skills and experience available in the sector.”  

Tony Armstrong, the chief executive of Locality, said: “Community ownership can help save our local high streets and heritage, bring communities together and be a foundation for local economic renewal.

“Community assets have been sold off at huge rates over the last few years, and the pandemic puts these places in further danger.

“Through community ownership we can prevent the buildings and spaces we love, our libraries, youth centres, allotments and public swimming pools, from falling into private hands.”

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