Scarborough Council spends over £1m on consultants to assist Towns Fund bids – three times more than other authorities

But the council insists the £1m-plus spending on consultants represents “value for money”.

Across Yorkshire, more than £3m of public money has been spent on consultants in attempts to win “levelling-up” cash in Government funding contests.

Yorkshire councils have used a combination of Government grants to support bidding processes and their own funds to hire an array of private companies to support their efforts to receive money from schemes such as the Levelling Up Fund, Towns Fund and UK Community Renewal Fund.

More than £1m has been spent by Scarborough Borough Council alone in this manner.

'Bids secured £37m to transform borough'

The council initially used £189,586 of money provided by the Government on the services of AECOM to support a bid for £50m of support for Scarborough and Whitby in the £3.6bn Towns Fund.

Subsequently the bid resulted in the granting of £37.3m for the area – £20.2m for Scarborough and £17.1m for Whitby.

But the council then spent a further £873,262 of its own cash on external consultants for a further £25.5m worth of projects it hopes to win Towns Fund money for.

These include £5m for work on Scarborough Harbour West Pier, for which Mason Clark Associates has been paid £254,000, and £6.5m for the Scarborough Station Gateway, for which AECOM received £353,000.

The council says consultants’ fees have been paid upfront and it is intended they “will be claimed back from the projects upon successful completion and submission of full business cases and release of funding from the Department of Levelling Up, Housing & Communities”.

The figures are revealed in Freedom of Information requests submitted by our sister paper, The Yorkshire Post.

Across Yorkshire and Humber, councils and mayoral combined authorities have collectively spent £3.3m on external consultants, using a mixture of Government funding to support the bidding process and their own funds.

Scarborough has spent the most at just over £1m, followed by Bradford Council which spent £353,000.

Rotherham Council was the third highest spender on external consultants, paying out £322,921 in total.

A Scarborough Council spokesperson said of the spending: “We believe this is value for money.

“As a result of the expenditure on consultant support, we will see approximately £37.1m of Town Deal investment, and a further £30m-plus in funding from our own capital and private sector investment over the next four years.

“The work also provides us with the information to apply for and secure up to a further £20m from the Levelling Up Fund in 2022.”

'Not value for money and conflict of interest'

The Local Government Association has warned that as a general principle the use of competitive bidding processes for grant access is poor value for money, especially given that councils have had guaranteed Government funding substantially reduced in the past decade.

The Scarborough Council spokesperson added: “Ideally funding should be allocated where there is greatest demonstrable need. The Towns Fund does this to a certain extent by identifying those key target areas where levelling up is most required.

“The Town Deal part of the Towns Fund is not a competitive process. Allocations are made on the basis of evidenced local need and are assessed at a local level using the revised Green Book criteria, which now includes greater elements of social and community value in its consideration.”

Companies which represented several Yorkshire councils submitting rival bids for the same pots of funding have insisted the situation did not cause conflicts of interest.

One of them, Mott MacDonald, worked on Levelling Up Fund bids for Doncaster, Leeds and South Yorkshire, as well as Towns Fund bids for Calderdale, Doncaster, Scarborough and North Lincolnshire.

A spokesperson said: “We are proud of our work advising local authorities up and down the country. We are delighted to have helped secure £131m from these three funds for local authorities in Yorkshire.

“Local authority clients appoint us to work on these funding bids based on our experience. We always act in the best interests of our clients and while protecting confidentiality we are transparent about our work on other projects.”

The series of Freedom of Information responses reveal different councils submitting bids for the same pots of funding have been employing the same consultancy firms to make their separate cases to the Government. While almost £400m of funding has been earmarked for councils in this region from the Levelling Up and Town Funds so far, critics say the situation highlights how areas are being pitted against each other in a fight for funding.

Across the country, local councils receive almost £16bn per year less than they did in guaranteed government funding than they did in 2010. The Levelling Up Fund will eventually be worth £4.8bn, the Towns Fund £3.6bn and the Community Renewal Fund £220m – collectively totalling less than £9bn.

A Local Government Association spokesperson said: “The use of short-term grants is increasingly representing poor value for money.

“Councils need certainty to plan local services without the added burden of navigating a complex and fragmented funding landscape.”