Source · Select Committees · Housing, Communities and Local Government Committee
Recommendation 23
23
Rejected
Paragraph: 82
UK Shared Prosperity Fund consistently reported as insufficient replacement for EU funding
Conclusion
We have heard from representatives from the Welsh and Scottish Governments, officials from Northern Ireland, and from English local authorities, all of which have said that the UK Shared Prosperity Fund (UKSPF) was not a sufficient replacement for previous European funding. However, the DLUHC has assured us that the UKSPF is indeed a sufficient replacement. We have endeavoured to reconcile these differing views and better to understand what the reality of the funding situation is. the House of Commons Welsh Affairs Select Committee and the Scottish Affairs Select Committee have also spent time trying to get to the root of the disagreement between recipients and the Government on the sufficiency of these funds. However, all the evidence we have received has said that the UKSPF is not a sufficient replacement.
Government Response Summary
The government rejects the conclusion that the UK Shared Prosperity Fund is not a sufficient replacement for EU funding, stating that total UK-wide funding will at least match previous EU structural fund receipts by 2024-25. They explain their calculation methodology and highlight engagement with devolved administrations on bespoke allocation.
Paragraph Reference:
82
Government Response
Rejected
HM Government
Rejected
At Spending Review 2020, we announced that funding for the UKSPF will ramp up so that total domestic UK-wide funding will at least match receipts from EU structural funds – the European Regional Development Fund (ERDF) and European Social Fund (ESF)- on average reaching around £1.5 billion per year. The Government’s methodology for calculating UKSPF allocations was published alongside the UKSPF prospectus in April 2022 and it explains how we estimated the average annual size of EU Structural Funds in England, Scotland, Wales, and Northern Ireland in real terms. This can be accessed here. The Government is clear that the quantum of funding that has been made available for UKSPF in 2024-25 (when the European funds have completed paying out), is sufficient to replace European funds. Prior to 2024-25 the UK Government has taken account of ongoing ERDF and ESF investment across the UK, which the UK is paying towards as part of the Withdrawal Agreement. In addition, it is worth noting that the Department engaged with the devolved administrations and local government associations immediately prior to the fund’s launch to design bespoke allocation methodologies for places in Scotland and Wales. The bespoke allocation methodologies for Scotland and Wales are explained in this allocation methodology here. The Department will continue to engage with the devolved administrations to support the delivery of the Fund and will seek to improve engagement and collaboration on any future funding.