No cash yet handed out by Regional Growth Fund

The government's £1.4bn Regional Growth Fund (RGF) has yet to hand out any cash despite being launched 15 months ago, it has been revealed.  

Unveiling by Nick Clegg in June 2010, the RGF was set up to support businesses which depend on public sector employment and help them cope with the transition to private-sector led growth. Speaking in Bradford, the deputy prime minister said: "Alongside our commitment to waive some employment taxes for new businesses starting up in targeted regions of the country, this fund can make a real difference to companies during difficult times."

Bids worth more than £3.3bn have been made but it has emerged that no funding has yet been allocated.

The news was revealed by a Freedom of Information request by left-wing political blog Liberal Conspiracy.

In response, Phillipa Lloyd, director of economic development at the Department for Business, Innovation and Skills, said: "The successful bids are currently undergoing due diligence, apart from one which has completed the due diligence and has been provided with a final offer letter, before a final offer of funds can be made.”

The revelation follows a recent report by the Public Administration Committee which condemned the Civil Service as "dsyfunctional" and unable to deliver the government's reform agenda.

It called on the government to "formulate a coherent programme for change across Whitehall" adding that if it doesn't, the wider ambitions for public service reform, the Big Society, localism and decentralisation will fail.