Government plans to redistribute English EU funding to devolved nations

Government plans to redistribute English EU funding to devolved nations
Regeneration & Renewal, by John Geoghegan

According to the Department of Business, Innovation and Skills (BIS), the UK is expecting to receive €9.6 billion (£8.1 billion) of European Union (EU) structural funding, which promotes economic development in less wealthy regions, from 2014 to 2020. This compares to €10.1 billion (£8.5 billion) between 2007 and 2013.

Final allocations will be subject to the ongoing negotiation of the 2014-20 EU budget with the European Parliament, BIS said, and the approval of the UK government’s proposals by the European Commission.

But the department said that, because of a new EU formula for allocating structural funds, agreed by the European Council in February, "there would not have been a fair distribution across the UK, with each of the devolved administrations set to lose significant funding vital for economic growth".

In a statement, BIS said: "In view of this, the UK government has decided to re-allocate EU structural funds to minimise the impact of sudden and significant cutbacks in Northern Ireland, Scotland and Wales."

Following its re-allocation, BIS has calculated that England should get €6.2 billion (£5.2 billion), Scotland €795 million (£672 million), Wales €2.1 billion (£1.8 billion), and Northern Ireland €457 million (£386.5 million).

As a result, Northern Ireland would receive €181million (£153million) more than it would otherwise have done, Scotland €228million (£192.8million) more, while Wales would get a €375million (£317million) upift. England, on the other hand, would lose out by €784million (£663million).

BIS said that each of the devolved administrations will consequently be subject to an equal EU structural funding cut of about 5 per cent compared to 2007-13 levels.

It added: "The government believes that this delivers the fairest deal for England, Northern Ireland, Scotland and Wales."

In 2007-13, according to BIS, England received €6,518million (£5,512million) in structural funding, Wales €2,264million (£1,914million), Scotland €839million (£709.5million) and Northern Ireland €482million (£407million).

England’s funding will be given out to the country’s 39 business-led local enterprise partnerships and their local authority partners, BIS said, with a breakdown to "be announced shortly".

BIS said that structural funds, which includes the European Regional Development Fund and the European Social Fund, support projects "such as building skills for the unemployed, increasing the participation of women in science and engineering careers, and developing new healthcare technologies".