Public Accounts Committee not convinced on how Newark was chosen to benefit from £25m under the Towns Fund scheme

The way in which towns were chosen to benefit from a £3.6bn regeneration fund was not impartial, a report by MPs has said.

Newark was awarded £25m under the Towns Fund scheme, prompting accusations that the town’s MP, Robert Jenrick, who is also communities secretary, had favoured his own constituency.

The scheme was launched in 2019 to help struggling towns.

But the Public Accounts Committee, in a report published on Wednesday, said it was not convinced by the rationale for selecting some towns and not others, saying that justifications offered by ministers were vague and based on sweeping assumptions.

It also said some towns were picked by ministers despite being identified as low priority.

“This lack of transparency has fuelled accusations of political bias in the selection process, and has risked the civil service’s reputation for integrity and impartiality,” the report said.

The Ministry of Housing and Communities said the selection process had been comprehensive, robust and fair.

Money from the Towns Fund is aimed at places with industrial and economic heritage that had not always benefitted from economic growth in the same way as more prosperous areas.

Mr Jenrick said the decision to give the money to Newark had been taken by another minister.

He said he had had no involvement in the decision.

But shadow communities secretary Steve Reed said the committee’s report raised more questions about the government’s misuse of taxpayers’ money.

The committee said the communities department should be clear on how funding decisions were reached to avoid accusations the government was choosing towns for political reasons.

Ministers picked towns from 541 places ranked by local need and growth potential.

Ministers chose all 40 high-priority towns, plus an extra 60 places from the low and medium priority categories.

The government said it completely disagreed with the criticism of the criteria used to award the money, saying factors such as the number of people without formal qualifications or a job were taken into account.

Last month Mr Jenrick said ministers did not make decisions about their own constituencies but “neither should their constituencies be victims of the fact that they have an MP as a minister.”