Key questions remain unanswered as MPs publish Government response to Shared Prosperity Fund report

Key questions remain unanswered as MPs publish Government response to Shared Prosperity Fund report

The Welsh Affairs Committee today publishes the Government’s response to its Wales and the Shared Prosperity Fund report, and expresses concern about the continued lack of certainty about the Fund.

In the Spending Review 2020, the UK Government announced that the Shared Prosperity Fund would “at least match receipts from EU structural funds, on average reaching around £1.5 billion per year” and that £220m would be provided “to support communities to pilot programmes and new approaches”. A ‘Heads of Terms’ for the Fund was also published as part of the Spending Review. The Government pledging to set out further details of the Fund in a UK-wide investment framework published in the Spring of 2021.

The Government’s response to the Committee’s report Wales and the Shared Prosperity Fund, confirms that further announcements will be made in Spring.

Despite these announcements and the Government’s response, the Committee remains concerned about the lack of information about how the Fund will operate and the total amount of funding which will be provided to Wales.

The Committee’s report, published in October, concluded that the UK Government had made negligible progress since 2017 in developing its proposals for the Fund. The report warned that there was “no clarity as to what the Shared Prosperity Fund will look like, how it will be administered, nor how it will be funded”.

The Committee’s report also included the following conclusions and recommendations:

• The UK Government should “urgently work with the devolved governments of Wales, Scotland and Northern Ireland to agree priorities for the Shared Prosperity Fund and to co-create the details regarding how the Fund will work”.
• The Fund should be based on a need-based formula and a multi-year financial framework and Ministers should honour their commitment “to maintain at least the current levels of real-term funding for Wales”.
• Regardless of where power and responsibility lies for the management of the Fund, it should be “built upon the principle of cooperation and partnership between the UK Government, the devolved administrations and local government”.

Commenting on the publication of the Government response, the Chair of the Welsh Affairs Committee, the Rt Hon Stephen Crabb MP said:

“While the outlines of the new Shared Prosperity Fund have been provided in the Spending Review and the Government’s response to our report, we are concerned that there are still major questions which need to be answered. With only a few months to go until the Fund is due to be introduced, we still require certainty about the total size of the fund, how it will be distributed, and whether Wales will secure at least as much as it currently receives under EU structural funds. We also note the lack of information about what role, if any, the devolved administrations can expect to play in the Fund’s operation.

While we are today publishing the Government’s response, we do not consider this matter to be closed. We intend to return to the Shared Prosperity Fund in the New Year, when we expect the full details of the Fund to be published.”