As the clock ticks down to Brexit, time is fast running out on the £680million annual funding package Wales receives from the European Union and we are learning more and more about what this means for our area.
Just looking around you can’t help but see examples of how European funding has changed our area. From the Bay Campus, the sunken gardens and toddler play area on Aberavon beach, to Croeserw Community Enterprise Centre, the Cognation mountain bike trails, the transport hub, the former magistrates court and the soon to be redeveloped Plaza, all have received European funding.
European money has also helped individuals through schemes like Workways and Workways +, programmes to help people tackle the barriers that have prevented them from finding employment. Or the Local Investment Fund, providing flexible financial support for small and medium enterprises and start-up businesses. Rural areas like the Afan valley and Margam will benefit from the Rural Development Fund supporting businesses, farmers, the countryside, and communities in rural areas.
Earlier this week a new Communities in Charge report showed what would happen if, post-Brexit, the UK government were to apply the same funding formula to these repatriated EU funds as they do to the current UK investment. The shocking findings were that Wales would lose far more money than any other area of the UK, the equivalent of each person losing more than £700. Conversely, the richest areas like London would gain £200 of spending per head.
In 2017 the UK Tory government made a commitment to set up a new UK Shared Prosperity Fund (UKSPF) to replace EU funds after 2020, with the intention to ‘reduce inequalities between communities across our four nations’, and will be ‘cheaper to administer, low in bureaucracy and targeted where it is needed most.’
But with December 2020 fast approaching – the time when these EU funds will run out – nearly everything about the fund is still to be worked out, leaving huge unresolved issues. We still don’t know how much funding will be available, how it will be divided across the country, what activities will be eligible for support or who will take the decisions on how the money is spent.
There is a huge fear that it will be not just a financial grab, but also a power grab; that the Westminster Government will use this opportunity to reduce funding for areas that need it most and to claw back powers that sit naturally with the devolved administrations.
This is why last year I launched of the All-Party Parliamentary Group (APPG) on post-Brexit funding for nations, regions and local areas, which I now chair. We launched a national inquiry which heard from 80 different bodies across Wales, England, Scotland and Northern Ireland, and published a report which recommended:
- The UKSPF must not comprise a penny less than what the EU would have invested in Britain from 2020 to 2024;
- The government should prioritise narrowing the difference in prosperity across the UK;
- In Wales, Scotland. and Northern Ireland the UK government should respect the devolution settlement;
- The management structures should make greater efforts to involve local authorities, because it is local stakeholders and the practitioners who will ultimately be best placed to deliver for the local community.
Months after the report was published there is still no action from the Government. I have met with three different Secretaries of State including Liz Truss MP in the Treasury, and secured a Parliamentary debate, to impress on them that Wales must get the regional funding that it needs. But the public consultation they promised, which was designed to allow devolved government, local authorities and other experts to help shape the UKSPF is being kicked into the long grass. It appears that there will be no consultation on the size of the funding pot at all. This is extremely worrying for Wales.
Make no mistake the figures are serious business. Between 2014 and 2020 West Wales and the Valleys will have received £2billion, no other area of the UK received more than £750million. We would need a government commitment of £30billion UK-wide over 10 years, to match what the EU would have contributed.
We cannot allow Westminster to use Brexit and the end of the EU’s regional funding as an opportunity to short-change the poorest parts of the UK. There is a fundamental worry that the Shared Prosperity Fund will become a political slush fund, with a Conservative Government using it to buy votes in marginal seats. After all, this is the the Government that decided to announce a £1.6billion Stronger Towns Fund for English communities in a blatant attempt to buy the support of Labour MPs just days before a crucial Brexit vote. Another emerging concern is that they will try and merge the UKSPF with other growth funds, using a sleight of hand to reduce investment in our communities.
Neither should the UK government preside over a ‘Westminster Power Grab’ whereby matters typically handled by the devolved administrations are appropriated by London. It is essential that the devolution settlement is respected in words and in actions. We can’t have civil servants at the other end of the M4 making taking decisions for areas they’ve never visited.
It’s not just my APPG that are concerned. The esteemed Commons Housing, Communities and Local Government committee has also implored the Government to stop dragging their feet, telling them they must ‘urgently advance’ their plans for the establishment of the UKSPF. But what we have seen from Government on this is that they are truly paralysed by Brexit. Worryingly that paralysis is in real danger of having real-world consequences on projects, schemes and initiatives that help my constituents in Aberavon. We need Westminster to commit to ‘not a penny less’ and ‘not a power less’, and fast.