Theresa May announced this week that £1.6 billion will be spent post-Brexit to help ‘boost economic growth’ in poorer towns. Within hours it was being called a ‘bribe’ as the recipient towns all predominantly voted Leave. These are precisely the MPs that she needs to keep on-side as we approach another round of crucial voting on Brexit on 12th March.
But, ignoring the reasons behind the fund, there are some immediate causes for concern.
Firstly, Wales, Scotland and Northern Ireland don’t even get a mention in the distribution map (perhaps she has other plans for them…I say generously).
Secondly, the £1.6 billion (of which £600 million will be ‘bid’ for) will be spent over seven financial years – about £220 million a year. Not even one week’s Brexit ‘dividend’ as promised on the side of that bus.
For the South West that equates to a relatively measly £5 million a year – even though the region contains Cornwall, the second poorest area in Northern Europe. A BBC reality check report notes that ‘among the English regions, the South West is the biggest recipient of EU funding but the second smallest recipient of the new money.’
The North West fares a little better in May’s plan with the highest allocation of £281 million or £40 million a year.
But bribe or not, is it a good deal for those areas?
In a word: No.
The level of EU funding (the European Structural and Investment Funds) to the UK over the same period to address similar things (and hence is what May’s fund replaces) is about £1.5 billion per year. Every year.
But that is only the part that comes for development – with all other EU funding areas, we currently receive around £5.5 billion a year. Wales, which isn’t even mentioned in May’s plan, receives around £680 million a year of that – £250 million more than its EU contribution, making it a net recipient.
And that, to me, is one of the key benefits to the EU funding system…the distribution.
UK governments have persistently failed many of our poorer areas over many, many years. As with May’s fund, distribution all too frequently seems to be connected to political gain – or ‘buying people off’.
While it can be argued that EU money is actually ‘our’ money anyway, the distribution of that money is connected far more fairly to need and opportunity.
Having what is effectively a third party road map with distinct funding areas (such as agriculture, development, or research and innovation) cuts through the political shenanigans and does what the national government should, but doesn’t, do – it helps spread wealth and opportunity more evenly through the country regardless of political leaning.
To me it’s clear that we can’t leave regional support solely in the hands of the national government – too many political factors influence where it is allocated. This week it seems to be going to those whose votes Mrs. May desperately needs to get her Brexit bill through Parliament.
To see what projects EU funds have supported in your area, see https://www.myeu.uk/
BBC Reality Check, ‘Stronger Towns Fund. How does it compare with EU funding’, 5th March 2019.
House of Commons Library Briefing Paper No. 7847, ‘UK funding from the EU’, 28 November 2018.