What ever happened to the UK Shared Prosperity Fund?

In the run up to Teresa May’s first Brexit Deal a “UK Shared Prosperity Fund” was mooted as a replacement for European Union structural funding worth about €2.4 billion per year.

These funds are currently administered regionally via the network of Local Enterprise Partnerships.  A consultation with a range of regional, political and industry stakeholders took place to define the purpose and priorities of the consultation on the objectives and remit of the fund.  Participants were led to believe that the formal consultation would take place in February or March 2019, close to the then revised date for the UK to leave the European Union.  A clear aim was to ensure continuity for regional support for industry, employment and community development after the UK left the European Union. Since that time there has been a deafening silence on the plans for the fund.

In July 2019 a Ministerial statement set out the aspirational principles of the fund:

  • The objective will tackle inequalities between communities by raising productivity.
  • The fund will be simplified to address the issue that EU Structural Funds have been difficult to access and that EU regulations have limited some of the opportunities for  investments underpinning productivity.
  • The fund will operate across the whole UK, respecting the devolution arrangements in Scotland, Wales and Northern Ireland.
  • Local priorities will be addressed. Local Industrial Strategies for England will highlight long-term opportunities and challenges to increase local productivity.
  • Consultation with the public will take place this year, under the Industrial Strategy.

The statement described ambitions, but was light on detail and made no indications when consultation with the wider public would take place.

In August a hundred CEO’s from major organisations, charities housing providers and companies wrote to the Prime Minister demanding that he take action to create the “world-leading” fund to help local areas grow, once EU funding ends, a 2017 Conservative manifesto pledge.  UK funding via the European Social Fund is almost doubled by the matched funding projects are expected to contribute. Letters to government from the Employment Related Services Association and the National Council for Voluntary Organisations, highlighted that greater impact is required from the new fund over the 2020 to 2027 period. The letters emphasised that the fund needs to be designed now.

Where are we now? We are still waiting for a consultation and a plan for the programme going forward.  Undoubtedly like the “fog of war”, the “mayhem of the Brexit negotiations” has taken eyes off the ball.  Departure from the European Union, which is widely accepted, requires detailed planning to ensure minimum disruption to the British economy both in the short and long term.  Support for regional economies is vital for the UK in a post-Brexit world, to offset some of the inevitable downsides of exiting from the EU.  That being the case, consultations to establish the rules of the programme are needed now if the vision of a simple and effective scheme is to be achieved before the end of any “transition period”.

Huw Edwards – MSC R&D