Cash pot axed

A fund which has provided millions to businesses across Greater Manchester has been scrapped by the Government.

The Grants for Business Investment scheme provided aid to firms in the poorest parts of the country.

Between 2005 and 2010, it paid out more than £9 million across the Greater Manchester.

But the scheme will be scrapped when the North-West Regional Development Agency (RDA), which runs it, closes in 2012.

Nationally, more than £428 million in grants has been handed out. Details of scrapping the scheme were included in the Government’s Local Growth White Paper.

It said: “Grants for Business Investment (GBI) is a national scheme providing grants on a selective basis to support sustainable investment and job creation projects in the assisted areas of England.

“For all but the largest cases, the scheme has been delivered by the RDAs.

“RDA-provided GBI will cease with the closure of the agencies. The Department for Business, Innovation and Skills will, however, consider large-scale cases on an exceptional basis.

“This decision reflects both the need to address the budget deficit and the shift in focus from nationally-led to locally-driven policies to deliver economic growth.”

The fund was available in places designated as “assisted areas” under European Union legislation. Around three quarters of the money available went to manufacturing firms.

A Department for Business, Innovation and Skills spokesman said: “The Government is committed to supporting business projects that create growth, particularly in areas dependent on the public sector.

“The limiting of GBI to large exceptional projects in the future will not harm firms that have used this type of regional support in the past.

“Those with good projects may be eligible to compete for funding from the £1.4 billion Regional Growth Fund.”

Last week Deputy Prime Minister Nick Clegg admitted there had been 450 bids for support from the Regional Growth Fund.

So far the bids come to well over £2 billion — and demand is far outstripping supply.

There is only £1.4 billion in the RGF, which will also have to cover a second round of bidding later this year.