Let’s talk about Shared Prosperity

Last November, the government promised a consultation on the proposed UK Shared Prosperity (UKSPF) Fund by the end of 2018.

Almost a year later, it has still not appeared.

These are chaotic political times. The abnormal is normalised. It’s easy to forget that the bread and butter of governance should still be getting sliced and spread every day.

We have a government (in London, Belfast is another matter) and Parliament is sitting and it is fair for the public to expect some form of governance. Brexit, of course, dominates everything. However, the promised Shared Prosperity Fund is right at the heart of the sunlit uplands on the horizon.

The UKSPF is intended as a replacement for the EU’s European Structural and Investment (ESI) funds, which supports various pieces of infrastructure designed to reduce disparities in different regions of the UK.

The UK gets around £2.4bn per year through these funds – of which about £500m goes to charities – which is comprised of the European Regional Development Fund (ERDF), the European Social Fund (ESF), and support for fishing and agriculture.

Scope wrote previously about how the ESF provides the bulk of funding for employability programmes here in Northern Ireland. Its loss – without suitable replacement – would devastate an entire sector.

However maybe – maybe – there is a hint that this long-awaited UKSPF consultation is coming soon.

At the start of last month, the House of Commons Library published a paper summarising the situation with the UKSPF.

The Commons Library is an research service that provides impartial information to MPs and their staff in order to facilitate the running of Parliament. Perhaps this paper is designed to be timely. The Library is an independent operation but that doesn’t mean they can’t keep their ear to the ground.

Promises

Promises have been made about internal replacements for EU funding.

The government said explicitly that any funding earmarked during the current EU spending period (effectively the next three years) that is not allocated by the EU will be directly replaced from central funds.

However, promises are not guarantees. Nothing has been defined or finalised or built.

The UKSPF would go further than that. Filling an immediate hole from absent EU funding would simply be the start, with the fund a long-term replacement – and hopefully a successful one.

Per the 2017 Conservative Party manifesto: “We will use the structural fund money that comes back to the UK following Brexit to create a United Kingdom Shared Prosperity Fund, specifically designed to reduce inequalities between communities across our four nations.

“The money that is spent will help produce sustainable, inclusive growth based on our modern industrial strategy. We will consult widely on the design of the fund, including with devolved administrations, local authorities, businesses and public bodies”

But, for now, it does not exist. A change in Prime Minister does not change the need to establish this fund. It cannot be established without proper proposals and consultation.

Early last month a motion passed in the Commons noting concerns about the lack of clarity around the UKSPF and calling for it to fully replace its equivalent EU funding as a minimum.

The motion was brought by Drew Hendry, the SNP MP for Inverness, Nairn, Badenoch and Strathspey, who told the House: “Communities and charities have now been waiting for years to find out what funding will be available post-Brexit, yet so far there is nothing from the UK government other than a name, that the Union flag will be on it and that it will be administered by the Minister for Local Government in England.

“In mid-November last year we were promised that a consultation on the UK Shared Prosperity Fund would be published before the end of that year, but there is still nothing. All the while, the hard-working volunteers, charities and communities face rising concerns about the future of the people they selflessly serve, and about their own futures.”

Government line

Jake Berry, Minister of State for the Northern Powerhouse and Local Growth, said the fund would respect devolution in Scotland, Wales and NI and that the government wants to work with devolved administrations as partners

He said further that the amount of money involved in the fund would not be made clear until the comprehensive spending review planned for next year (which does not rule out the idea of a consultation coming any time between now and then).

“It is quite right that areas are worried about the future of their funding, which is why the Government have set out a guarantee—deal or no deal. This week, I was involved in discussions approving new spending in the current period of European funding, and the guarantee enables commitments to be made until 2021, and it will apply to commitments that are paid out between now and 2023, so there is certainty for projects. Projects are still being approved.

“With the guarantee, there will be no gap, and clarity about the quantum and the form of the UK shared prosperity fund will become clear at the comprehensive spending review, notwithstanding the fact that we are already involved in deep consultation with both the recipients of the funding—British taxpayers’ cash—and the mayors and devolved Administrations. Official level consultation is ongoing between the devolved Administrations and the UK Government. The most recent meeting took place on 2 August, and additional consultations will happen later this month.”

Obviously, NI has no devolved administration at this time. Perhaps the government has been speaking to the DUP, on behalf of NI. Perhaps they have been speaking to all our major parties, or to civil servants, or to no one.

Consultation, and afterwards

When the consultation does come, what should civic society have to say about a Shared Prosperity Fund?

That its value should at least match the EU streams is a good starting point, but no more.

The Joseph Rowntree Foundation (JRF) produced a paper with several recommendations for the UKSPF, noting: “In the EU referendum in 2016, the highest numbers of votes to leave the EU were recorded in the UK’s most deprived communities. As the UK prepares for Brexit, the creation of the UK Shared Prosperity Fund is an opportunity to address the discontent expressed in the vote to leave and make ‘inclusive growth’ a reality…

“The UK’s departure from the EU presents a new dynamic in the existing devolution settlements with Scotland, Wales and Northern Ireland. There is a need to build mutual trust in the process by which resources from the UK Shared Prosperity Fund are determined and allocated. It should be done outside of the Barnett formula.

“While the employment rate and lower-quartile pay should be the key economic measures, the precise methodology and thresholds should be openly and transparently negotiated between the three devolved administrations and the UK Government using the formal machinery of government, such as joint ministerial committees. Once allocated, there should be no reduction in the freedoms of the devolved administrations to design programmes for their area.”

Sidestepping the Barnett formula and focusing on need would probably be a good thing for NI (and allocations based on need would offer something closer to continuity).

The Commons Library paper contains a precis of the JRF report, as well as several other notable views on any Shared Prosperity Fund (including from the National Council for Voluntary Organisations, NICVA’s sister organisation in England).

The key point however is that these are ideas that should be brought forward and discussed in earnest.

Good organisations in Northern Ireland rely on these EU funding streams. It may not feel like it, but Brexit – meaning the act of leaving the EU – will reach a resolution at some stage.

Resolutions on everything peripheral or consequential to that – a gargantuan number of things – is vital.