Business groups attack £ 1.65bn cut to ‘level’ funding in the north after Brexit

Business groups and local councils are protesting a hidden £ 1.65bn post-Brexit cut in development finance in the north, a further blow to Boris Johnson’s claims to ‘level’ the country.

South Yorkshire is set to lose £ 900million and Tees Valley and Durham £ 750million over six years, the organizations told Michael Gove.

The Red Wall regions, as well as Lincolnshire, were vying for the money as they have become relatively poorer since the last spending cycle that ended last year.

The government has pledged to match the EU’s lost funding after Brexit – to “tackle inequality and deprivation,” he said – but is now accused of a second broken promise.

The National Enterprise Network, an organization providing advice and funding for growth opportunities, said it was the latest blow to job creation after the loss of other investment grants.

“Our network cannot support economic growth or realize its potential with the existing funding patchwork,” said President Alex Till. The independent.

More than 100 groups – ranging from local councils to charities and businesses – have sounded the alarm bells about the low level of funding from the Shared Prosperity Fund (SPF).

Now SPF all-party parliamentary group chairman Stephen Kinnock has attacked ‘smoke and mirrors’ over funding, alleging:’ It appears that, rather than ramping up, the UK government intends to to lower.

In a letter to Mr Gove, the Labor MP urged the leveling secretary to intervene – pointing out that Cornwall receives the highest funding.

Yet Cornwall (with a GDP per capita of 70.9% of the UK average) is now more prosperous than South Yorkshire (70.3%) or than Tees Valley and Durham (67.3%).

Steve Fothergill, national director of the Alliance of Industrial Communities, which brings together councils in primarily the former coal and steel regions, said: “It’s not that Cornwall doesn’t deserve its money. This is because in the absence of Brexit, other parts of England would now be poised to receive the same high level of EU funding as Cornwall. There is a great risk that these areas will now be treated less favorably. “

Mr Kinnock’s letter reads: “South Yorkshire, Tees Valley and Durham and Lincolnshire could have benefited from very substantial additional funding from the EU due to their deteriorating GDP.

“These three areas are now at risk of being treated much less favorably than they would have been in the absence of Brexit.”

Mr Kinnock adds: “The potential losses are huge – over a seven-year programming period, perhaps up to £ 900million for South Yorkshire and £ 750million for Tees Valley & Durham.”

The line follows the budget announcement that the SPF – the replacement for EU structural funds – will only receive £ 2.6bn over three years, not the £ 4.5bn needed to avoid overall losses.

This is in addition to the many existing criticisms of the SPF, which had already been delayed by a year – costing poorer parts of the UK an additional £ 1.5bn.

Distressed local councils and other groups were also required to compile offers, which “wasted time and resources” on 600 rejected applications, the letter from Mr Kinnock said.

The calculation of £ 1.65bn in lost funding has been reached from the population size of South Yorkshire, the Valley of the Tees and Durham – noting that Cornwall receives around £ 650 per capita more.

The Upgrading, Housing and Communities Department called the allegations of lost funding “unfounded,” but did not explain why.

“The UK Shared Prosperity Fund – worth over £ 2.6bn – will match, at a minimum, the size of EU funds in all countries, helping people across the UK to access opportunities and improve their skills, ”said a spokesperson.

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Natalee Broderick

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