Claire Hanna (Belfast South) (SDLP) I beg to move, That this House
has considered the shared prosperity fund and the devolved
Administrations. It is a pleasure to serve under your chairship,
Sir Edward. I am grateful for the opportunity to raise an issue and
hopefully to get some clarity on a matter of concern and potential
opportunity for a number of third sector partners and others in
Northern Ireland. It has been almost five years since the shared
prosperity...Request free trial
(Belfast South) (SDLP)
I beg to move,
That this House has considered the shared prosperity fund and the
devolved Administrations.
It is a pleasure to serve under your chairship, Sir Edward.
I am grateful for the opportunity to raise an issue and hopefully
to get some clarity on a matter of concern and potential
opportunity for a number of third sector partners and others in
Northern Ireland. It has been almost five years since the shared
prosperity fund was first floated as the replacement for the loss
of EU structural funds after Brexit. The SPF was included in the
Conservative manifesto, which claimed that the focus would be on
reducing inequalities between communities and that the Government
would consult widely on the design of the fund. The manifesto
explicitly outlined the involvement of the devolved
Administrations, although stakeholder engagement events a few
years ago were characterised to me by polite generalities and
weak assurances, and unfortunately the Government do not appear
to have met those commitments, either about the breadth and the
scope of the scheme or about the engagement with partners.
From what information we have, we know that funding will come
directly from Westminster, without the involvement of local
authorities or devolved Parliaments. In Northern Ireland, some of
the bodies that have been administering European funds for the
last several decades and that have experience and trusted links
are apparently being retired at this point, amid a centralisation
of power. The phrase “Take back control” resonated with many
people, but with some of the funds that have traditionally
underpinned social progress and economic progress in Northern
Ireland, it appears to mean taking back control and handing it
directly to London.
(Carmarthen East and
Dinefwr) (Ind)
I am grateful to the hon. Lady for giving way and I congratulate
her on securing the debate on a very important issue—perhaps the
most important issue for the economic development of the
respective countries of the UK. The hon. Lady is right that this
is an unashamed power grab by the UK Government. It fatally
undermines the ability of the Welsh Government, the Northern
Ireland Government and the Scottish Government to deal with their
role in economic development. A key part of the role, of course,
is strategic regional planning. The constitutional issue is very
important, but so is delivery. The way that the UK Government go
about the process will fundamentally undermine strategic regional
economic planning in our respective countries.
I agree. As I say, there are opportunities and willing partners,
but unfortunately it appears that the funding is being delivered
over the heads of those who have an interest in and a proven
track record on a number of the issues.
The latest information we have is that the fund is set to operate
from April 2022, which is next month, replacing funds such as the
European social fund and regional development funds that have
provided vital opportunity for infrastructure and specifically to
support some of the most marginalised and vulnerable individuals
in our region and across the devolved areas. At the moment,
however, the information people are seeking on the design, the
priorities, the level of funding available and the governance
arrangements simply is not there.
That confusion has left substantial holes in a number of Stormont
Departments and left many key third sector partners in the lurch.
Northern Ireland’s Department for the Economy has warned that the
£100 million gap that it faces in this funding period will mean
halving its apprenticeship programmes and a rollback of the
skills agenda, which has been a key focus of our party and of
many others.
It also means missing a potential opportunity. As Members from
all parties will know, we face an almost unprecedented demand for
labour. There are opportunities in that regard, but some of the
funds were specifically designed to work with individuals and get
them over the barriers that they personally faced to take up and
retain work.
There are organisations such as Orchardville, a social enterprise
and charity in my own constituency, which for four decades has
worked with people with autism and learning disabilities, helping
them to learn and to earn, and to have the dignity and support of
a work environment. At this moment, however, Orchardville faces a
substantial black hole.
It is worth saying that the concerns are held not just by those
organisations that sought to receive these funds, or by political
parties such as my own. Invest NI has been very clear that it
believes that the funding would be best delivered in conjunction
with the Northern Ireland programme for government and through
existing delivery partners. The think-tank Pivotal and a number
of other respected commentators and business voices have been
raising that point over the past month or two, and the Select
Committee on Northern Ireland Affairs has conducted a
wide-ranging inquiry into investment priorities in Northern
Ireland. Although people see opportunities, concern has been
expressed by many of those people about the loss of experience
and fidelity that changes to delivery will bring.
Northern Ireland, like other devolved regions, was a net
beneficiary in Europe—that is not a secret. I do not think it is
anything to be ashamed about either, because the funding
allocations were made on the basis of need, and in many cases
they were a counterweight to the obvious challenges that Northern
Ireland faced in those years, but also to decades of
under-investment in areas such as skills and infrastructure. We
have had the lowest UK rate of capital investment over many
decades and, of course, a stark failure to attract quality
foreign direct investment. The founder of our party, John Hume,
said many times that the best peace process is a job: the best
way to enable people to build and have hope in their futures and,
I suppose, to get around the things that have divided them is for
them to have meaningful employment—a reason to stay, a reason to
get up in the morning and a reason to build.
It is worth also saying that we unashamedly saw an opportunity
for Northern Ireland in that political example of common
endeavour, with people pooling their needs and abilities in a
spirit of co-operation and interdependence, without those people
having to change their identity in any way. The French are still
French in Europe, and the Germans are still German in Europe.
British people in Northern Ireland and Irish people in Northern
Ireland could still have an opportunity to co-operate, and the
European funds facilitated that over many years. Individuals and
the capacity they built, as well as regions and specific
industries, are almost unrecognisable after the funding they
received.
“Have faith and try new things” is the message we have heard so
far from the UK Government, but unfortunately, the experiences
people have had so far with the community renewal fund—billed by
the Secretary of State for Levelling Up as the forerunner to the
SPF— have exacerbated fears. Bids for that fund were invited by
the UK Government from a range of local applicants including, but
not limited to, universities, voluntary and community sector
organisations and umbrella business groups. They were received
from a variety of partners, such as Women’s Aid, Mencap, and the
Royal National Institute of Blind People. Applications were
rejected from groups including Catalyst, which is a
well-respected entrepreneurial hub, and Northern Ireland Screen,
which is trying to capitalise on the burgeoning film and
television sector in Northern Ireland and is creating the kind of
exciting jobs that young people in Northern Ireland have never
had the opportunity to have—the kind of jobs that allow people to
stay and to build a career and a life.
Who was the biggest recipient? It was not any of those groups: it
was TieTa, an Oxford-based call centre with no ground game and no
operational experience in Northern Ireland, a group that started
its life as the customer service arm of a payday lending company.
Its funding allocation through the predecessor fund was over
twice that of the next biggest recipient, which was Ulster
University. Looking at Companies House, three directors of that
company are listed: are they from Maghera or the Mournes, or are
they from Millisle? No, they are from Monaco; that is the
experience that people are having. The fears that many of us have
articulated for many years about the loss of EU funds have not
been allayed in any way by the rolling out of that fund.
We are in a new paradigm. We are where we are, and our approach
has always been to try to make lemonade out of the lemons we have
been handed. We want the opportunity to build in Northern
Ireland, we want to create real careers and real opportunities
for young people, and we want to capitalise on Northern Ireland’s
unique dual market access—the first real unique selling point
that we have had in many decades of sluggishness and low
productivity—but to do that we need local power in local hands.
That was a key part of the 1998 agreement. Brexit has not just
been a threat in terms of border and identities; that concept of
local powers, local decision making and building up trust between
local decision makers in mutual endeavour has been crucial to the
last 20 years.
The fund should have been an opportunity to realise some of those
ambitions. It should have been a way to connect regions—to “level
up”, in the common vernacular —and remove barriers to employment.
So far, the experience is not good. People need information, and
they need some experience that is not handing cash to people
registered in Monaco and Oxfordshire.
4.40pm
(Strangford) (DUP)
It is not often that I am called first to speak. Indeed, I am
always shocked that it should happen—and very pleased, too; thank
you so much, Sir Edward.
I congratulate the hon. Member for Belfast South () on her excellent
representations for the project that we all wish to see more
of—the shared prosperity fund. As she said, we want to see more
funds filtering down to our constituencies. She referred to three
or four things, including the TieTa group and its three owners
from Monaco. I just said to my hon. Friend the Member for Upper
Bann (), “Who wants to live in
Monaco when you can live in Millisle?” That is because Millisle
is in my constituency, of course—at least, part of it is.
(North Down) (Alliance)
Just for the record, Millisle is in my constituency.
No, for the record, the Drumfad Road—the Drumfad estate right up
to the car park—is in mine. I know it is, because I knock those
doors.
I am very pleased to support the hon. Member for Belfast South in
bringing the debate forward. There is absolutely no doubt that
the shared prosperity fund is needed to build on work that has
been done in every region of the United Kingdom through EU
funding. Not to be too pedantic, but it is always great to get a
percentage of the money that we funnelled into the EU back into
our communities. I am very pleased that we have been able to do
that.
I share a semblance of the dismay outlined by the hon. Lady, my
Northern Ireland colleague—we are from different parties but very
much on the same page on this issue—yet I am perhaps a wee bit
more optimistic. I suppose I tend to be more optimistic about
life—the glass is always half-full rather than half-empty—because
there are good things happening. To be fair to the hon. Lady, she
outlined the issues but also where we can go with this, and I
want to do the same.
When the new Minister of State, the right hon. Member for
Bournemouth West ()—it is lovely to see him in his
place—was appointed, I quickly asked him to come down to the most
beautiful constituency in the whole United Kingdom of Great
Britain and Northern Ireland, Strangford. I say to the hon.
Member for North Down () that that is not in dispute.
I was very pleased to bring the Minister down to Strangford. I
know that he has a deep interest in Northern Ireland—it has
always been in his blood and in his life—so it was good to get
him down to Strangford to introduce him to some of the issues on
which the shared prosperity fund could make the difference.
I want speak to those issues and to give the Minister a taste of
the concerns. I spoke to him before the debate and said, “Here
are my thoughts; are those things that you would like to do?” and
he very quickly said that he would. Issues such as the local high
street and how it should feature, and our education system, are
key for every one of us. We had a chance to go to Castle Gardens
School, and we went to the high street and met the chamber of
trade in Newtownards town. There is also our tourism industry; we
went to Mount Stewart, and we had a lovely lunch in Harrisons in
the constituency. That is one of the tourism projects that has
taken off.
In two major areas in which the EU has had control over subsidies
in the past, we spoke to the fishermen and, importantly, to the
community representatives. The Minister asked for that
specifically, and I was very pleased to make that happen. Those
are the sorts of things—the changes in the community—that we
want. I think I referred to them as the journeys that people have
taken away from the past to a new future. Those are the sorts of
things that I wish to speak about.
The Minister acknowledged the awful handling of the situation so
far for the fishermen. I know that the fishermen in Portavogie
were particularly enthralled with the Minister. Sir Edward, if
you ever want somebody to imitate our Prime Minister, he is the
man who can do it—nobody can do it better. For one minute, if I
closed my eyes, I thought it was the Prime Minister. The Minister
issued a promise to get it right with his colleagues; he did that
for us, and we appreciate that. I got him to meet with the local
community representatives from one of the estates in my area, a
very progressive community group that is probably one of the best
in the Ards area. I did so with a clear view of showing him how
far so many have come in our town, and the giant leap forward
there has been in the work that they carry out. It is work that
it is essential to continue. That is why the shared prosperity
fund is so important; it makes a difference and builds a future
that we can all wrap our arms around and be part of.
I felt that the Minister took seriously the five areas that I had
highlighted. The group he wanted to meet again was the community
group, and in particular, its young people. I could see that the
Minister was interested. He, like myself and the community group,
could see where the future needs to be built. The shared
prosperity fund is one way of doing that. We heard how the
community wanted to move away from the actions and the reactions
of the past. They want to train the new generations in a new way
of doing and looking at things. They want to train the new
generation to look at things in a way that, some time ago, the
community did not, and, if I am perfectly honest, in a way that I
did not 40 years ago either. The Minister saw the value of
facilitating the local community network through European funding
and his response was clear: the work must continue. I subscribe
to that. That is what the hon. Member for Belfast South wants. I
believe it will continue, but we need a wee bit of help.
We look to the Minister. I know I have been referring to the
Minister of State at the Northern Ireland Office—he will forgive
me for that, but I wanted to tell the story because it is part of
where we are. I look to the Minister for a positive response.
That cannot happen without dedicated funding. I have highlighted
the areas in my constituency that need help from the fund,
including the small businesses that we met on that day; people
working in fishing and agriculture, which are still major
employers; tourism, which Ards and North Down Council believes is
key to building the economy; and our community and educators.
Funding for innovation is also essential for large business
expansion.
All of that is necessary for a flourishing Northern Ireland—a
Northern Ireland for everyone. That is what I want to see, it is
what the hon. Member for Belfast South wants to see, and it is
what the Minister wants to see. I am sure that everyone else here
wants to see the same thing. There is work to be done, and more
to do. We have moved forward with a contribution from both sides
of the community working together. There is an appetite to do it;
there is an appetite from elected representatives, from the
Minister and from others here today.
I encourage the Minister to announce the parameters of the fund,
to allow every area—not just my constituency, but Belfast South
and every constituency in Northern Ireland—the support. We need
to help Northern Ireland, and indeed the United Kingdom of Great
Britain and Northern Ireland as whole, to live up to our
potential. I believe that Northern Ireland has that potential, we
just need help through the shared prosperity fund to do that.
There is no pressure on the Minister, whatsoever, but will he
tell us what he will do for us? We want to take that journey
together—all parties and all representatives, along with our
Minister and our Government.
4.48pm
(Ceredigion) (PC)
It is a pleasure to serve under your chairmanship, Sir Edward. I
will begin by thanking the hon. Member for Belfast South () for securing this debate and
for the welcome opportunity to discuss the shared prosperity
fund’s governance and scale, as well as the promises that were
made to the devolved nations. Levelling up is an economic
necessity, and for decades Plaid Cymru has drawn attention to the
chasms that separate our nations in economic development, social
opportunity and political attention. That is why, although I
applauded the long-term vision contained in the levelling-up
White Paper, I am concerned that it lacks the requisite funding
and structural reform necessary to realise that vision. Quite
simply, we need to get the shared prosperity fund right—a task
that has been made even more difficult by a less than auspicious
start. The Government dragged their heels in publicising the
detail and in implementing the fund itself, and we now know that
it also represents a broken manifesto promise, at least as it
relates to Wales. On page 15 of the Welsh Conservative manifesto,
the party committed
“to ensure that no part of the UK loses out from the withdrawal
of EU funding”.
The Welsh Government have recently calculated that the Welsh
budget will instead be £1 billion worse off by the year 2024 than
if we had continued to receive EU funding through the structural
funds. If we look to the EU and its €750 billion covid recovery
fund, or to Germany’s historic €2 trillion, or £71 billion
annual, investment in east Germany, we have an idea of the scale
of the funding that levelling up truly requires.
I urge the Government, in the light of some of those examples, to
raise their ambitions when it comes to levelling up—to levelling
up levelling up, even—and to perhaps look at committing 1% of GDP
over the coming decade, equivalent to some £22 billion annually,
to the shared prosperity fund and the task of levelling up the
nations and regions of the United Kingdom.
Sadly, in terms of governance, the UK Government are already
repeating past mistakes by adopting the same centralised
Whitehall model that created many of the regional inequalities in
the first place. The shared prosperity fund must be administered
by each nation, rather than being disbursed in a fashion that
turns nations and regions against each other. Not only is that
inefficient but it undermines devolved responsibilities for
economic development, a point made by my hon. Friend the Member
for Carmarthen East and Dinefwr ().
The shared prosperity fund must be better resourced and must work
with rather than over the devolved nations. Anything else would
be further proof that Westminster does not work for Wales. It
would also call into question whether it works for the
persistence of this Union.
4.52pm
(Merthyr Tydfil and Rhymney)
(Lab)
It is a pleasure to serve under your chairmanship, Sir Edward. I
congratulate the hon. Member for Belfast South () on securing this debate. I
declare my membership of the all-party parliamentary group on the
shared prosperity fund.
Since we heard about the shared prosperity fund way back in 2017,
the whole thing has been shrouded in confusion. The Government
have been less than forthcoming with clarity and detail. While we
now have some more information about the fund, there is still too
much uncertainty.
Then there is the top-down, Whitehall-led approach that the
Government have insisted on using. Welsh local authorities such
as my own in Merthyr Tydfil and Caerphilly County Borough
Council, which covers the Upper Rhymney valley part of my
constituency, have 20 years’ experience of working together
through the Welsh Local Government Association and alongside the
Welsh Government to deliver strategic regeneration projects. It
is deeply concerning that, instead of a strategic joined-up
approach to investment to tackle the urgent issues affecting our
communities, we now seem to see a centralised Whitehall-led
approach administered by Departments with no real understanding
of the needs of Welsh communities. They have limited experience
of working with communities in Wales and little understanding of
the priorities of those communities. There is also the complete
bypassing of devolution.
(Aberavon) (Lab)
My hon. Friend is making an excellent speech. I also declare an
interest: I chair the APPG on the shared prosperity fund. The
pre-launch guidance to the fund simply says that the devolved
Administrations
“will be invited to play a role in the development and delivery
of local investment plans.”
Does my hon. Friend agree that that is an incredibly vague
statement, which could mean absolutely nothing, and that the fund
is also part of a broader project being pursued by the UK
Government of dismantling the entire project of devolution?
I very much agree. We are seeing an opportunity to bypass
devolution, which is a very real threat to what has been built up
over the last 20 years. This is not the partnership approach we
all could have supported; I fear that it is a real step
backwards.
I am deeply concerned, as I know others are, that Wales and areas
across the UK are going to lose out as a result of the withdrawal
of EU funds, despite the promise that we would not lose a penny.
The Chancellor’s Budget for next year shows some £400 million
across the UK as opposed to the £1.5 billion that was earlier
mentioned. For the purposes of comparison, Wales alone used to
receive £375 million. Next year, for the whole of the UK the
figure will be barely that.
The lack of clarity from the Government on the amount of funding,
how it will be used and the involvement of devolved
Administrations has been hugely disappointing from the start, and
it saddens me that it shows no sign of improvement. Hopefully,
the Minister will give us further clarity and address the points
that have been raised for so long.
I want to give a short, quick example to the Minister. Some years
ago, prior to entering this place, I was a local councillor
heavily involved in regeneration in my local community. A hugely
significant regeneration project had £6 million of EU funding
allocated to it, but that was just a catalyst. That funding also
unlocked funding through the Welsh Government, the private
sector, the lottery and other charitable partners, and not least
the local community, meaning a significant investment of around
£26 million all told. Those projects are still going strong
almost 20 years later and are going from strength to strength. I
use that example as an illustration because of the nature of the
partnership between agencies, not least local government and the
Welsh Government. We should learn from such examples.
Finally, what measures is the Minister taking to ensure that we
can move forward in a spirit of collaboration involving all
partners? As I said previously, any investment is welcome, but it
should be in partnership with regional and local government and
the Welsh Government, who have had significant experience in
these areas. Speaking as somebody who was very much pro-Union, we
achieve much more when we work together in partnership for the
good of all.
4.56pm
(North Down) (Alliance)
It is a pleasure to serve under your chairmanship, Sir Edward. I
thank the hon. Member for Belfast South () for securing this important
debate today.
My comments largely reflect Northern Ireland, but there will be a
large degree of commonality between the situations in Scotland
and Wales. I speak as a former Minister for Employment and
Learning in Northern Ireland with overall responsibility for the
administration of the European social fund. I also have direct
knowledge of the application of the European regional development
fund as well, so I can testify to the huge value that both of
those played in Northern Ireland.
To follow up what the hon. Member for Belfast South indicated, we
were told that Brexit was all about taking back control. Well,
may I say that when we were members of the European Union,
Northern Ireland Departments had more control over that money
than we will have in the context of the shared prosperity fund.
That is a rather ironic situation, to say the least.
I have numerous concerns to highlight. The first involves
governance. To reiterate the point, this cuts across the devolved
settlements in all three nations and regions of the UK. In the
case of Northern Ireland, it cuts across the Good Friday
agreement itself, and that is a fairly serious thing to do. It
also creates a real mess in terms of governance itself. In
essence, we end up with the UK Government and the Northern
Ireland Executive both as players essentially on the same pitch
trying to do things in the same areas, whether it is around
skills, apprenticeships, labour market inclusion, economic
development or economic regeneration. Rather than that being
greater than the sum of the parts, I fear this will become lesser
than the sum of the parts because there will be built-in
inefficiency in terms of what happens.
With all the best intentions in the world around co-ordination
and communication, it has been far from perfect up until now.
Even if that is remedied, nothing will replace the same teams in
the Northern Ireland Departments having overall control over the
resources and applying them in the most efficient way. That then
begs the question as to what happens in terms of things like the
programme for government and measurements of impact. I am not
sure whether those have been highlighted by the Department at
all.
We are hopeful in Northern Ireland of having an outcomes-based
programme for government if and when devolution returns after the
Assembly election. In that context, it is important that whatever
happens, the Department for Levelling Up, Housing and Communities
works hand in hand to the same objectives. If not, again we are
going to miss the opportunity to make the best use of the
resources.
The same point applies to measurement. How on earth will the
Department measure the impact of its interventions on, for
example, skill levels, if it is only one part of a wider equation
in which Northern Ireland Departments, notably the Department for
the Economy and the further education colleges and universities,
are all trying to do the same thing? How on earth do we
disaggregate all of that? There is then the issue of the scale of
the spending. Like Wales, Northern Ireland was told that we would
be no worse off under the shared prosperity fund than we were
under the structural funds, and yet the Northern Ireland
Department of Finance and the wider Executive have made it clear
that Northern Ireland risks losing up to £70 million per year of
spending power. I would be grateful if the Minister could
reconcile those two seemingly contradictory positions.
We then come to the nature of the spending itself. There has been
a long-established pattern in terms of the areas where European
funding has been put to use. In terms of investment in skills, a
large part of apprenticeship funding in Northern Ireland has come
through the European social fund, and almost the entirety of
areas such as disability employment have been funded through
European funding. The ERDF supported a wide range of economic
development measures and regeneration issues. Indeed, Invest
Northern Ireland, our main inward investment organisation, has
depended on that type of funding, and its budget faces a very
uncertain future.
Even if those issues are clarified, there are issues around the
switchover between the next—and final—round of ESF and the start
of the shared prosperity fund. There are a lot of groups working
on the margins that are deeply concerned in that regard. There
are fears of gaps in the provision of programmes, and of some
programmes ceasing altogether. There are concerns about those who
are employed. Unlike the civil service, the community and
voluntary sector has to put people on notice of redundancy
whenever funding comes to an end. There are a lot of people out
there who are very worried about their own futures.
Finally, I want to ask why the actions and role of the Department
for Levelling Up, Housing and Communities in Northern Ireland
will not be covered under section 75 of the Northern Ireland Act
1998. By contrast, both the Northern Ireland Office and Her
Majesty’s Revenue and Customs are covered under section 75. The
spending that will potentially come through the Department is
much greater than that which comes through either of those
bodies, so the situation is slightly incongruous. I would be
grateful if the Minister could explain the discrepancy.
5.02pm
(North Ayrshire and Arran)
(SNP)
Thank you, Sir Edward. It is a pleasure to speak in this debate
on the shared prosperity fund and the devolved Governments, and I
pay tribute to the hon. Member for Belfast South () for bringing it forward and
for setting out her case so comprehensively.
The Tory manifesto pledged a fair and equal share of funding that
would fully replace EU support, which in Scotland would have been
around £183 million per year. However, the Treasury Committee has
already indicated, in a report published at the end of January,
that the UK shared prosperity fund up to 2024-25 will be worth
40% less than EU support. In addition, all the power over the
delivery of the funding is concentrated in Whitehall. There is no
doubt that devolved Governments have been ignored. The Scottish
Government as yet have no details of how much funding will be
allocated to Scotland, nor has there been any consultation with
Scottish Ministers, who have had no role in investment proposals
or decisions in areas that are devolved to the Scottish
Parliament.
The UK shared prosperity fund will replace the EU structural
funds from next month, and still there has been no meaningful
engagement with Scottish Ministers, or indeed those of other
devolved nations. In January, the House of Lords Constitution
Committee concluded that the UK Government continued to ignore
devolution and the devolved Governments’ calls for greater
transparency on decisions being taken with regard to levelling-up
funding. With the publication of the shared prosperity fund
pre-launch guidance this month, the role of devolved Governments
and Parliaments is still completely unclear. The UK Government
have chosen to work directly with local authorities, as presented
in the guidance, and there is no evidence that they respect
devolution or consider the Scottish Government, for example, an
equal partner. Because the UK Government have also failed to
offer any indication of Scotland’s shared prosperity fund
allocation, or indeed how levelling up will align with the
priorities of the Scottish Government, there is no overarching
strategic thinking or planning in accordance with the Scottish
Government’s priorities.
It is simply not respectful for the UK Government to seek the
Scottish Government’s help in implementing projects after they
have been selected by the UK Government. The Scottish Government,
and all the devolved Governments, should be consulted at all
stages, as was the case with EU funding. What possible objection
could there be to that, unless the purpose is to undermine
devolution? Although I appreciate that the Minister will tell us
of the great munificence of the UK Government, it is also
important to remember that in his last Budget, the Chancellor
announced several direct funding programmes in Scotland through
the levelling-up funding, totalling £172 million in spending.
However, the rolling out of the levelling-up fund to communities
around the UK short-changed the Scottish Government of expected
Barnett consequentials, leaving a £400 million hole in the
budget.
Delays to the delivery of post-Brexit funding—a year into
Brexit—have already robbed poorer areas of £1.5 billion in
funding, with the shared prosperity fund not set to deliver until
April. When it is delivered, it will fall far short of previous
EU funding. The reality is that Scotland will receive 3.5% of all
levelling-up funding, despite having 8.2% of the UK’s population.
Perhaps the Minister could explain that. The reality is that the
Secretary of State for Levelling Up and the Prime Minister led a
Brexit campaign promising £1.5 billion a year for Scottish
devolved services when the UK left the EU. Instead, all we have
heard is an announcement of £172 million. To put that into
context, Scotland has received 11p for every £1 promised. In
effect, Scotland has been short-changed by 89% of what was
promised. I know the Minister will dispute this, but there is a
growing consensus that the devolved Governments have been
short-changed. The Treasury Committee says so, the House of Lords
Constitution Committee says so, the Scottish Government say so,
and the Unionist Welsh Government say so. They all agree that
this is the case.
(Edinburgh North and Leith)
(SNP)
I want to raise the issue of Interreg with my hon. Friend,
because the shared prosperity fund is touted as a replacement for
EU structural funds, but the levelling-up White Paper makes no
mention of Interreg. Interreg was very important to organisations
such as the European Marine Energy Centre in Orkney, which works
in collaboration with other partners and gets a lot of funding on
the back of that in order to tackle really important common
challenges in meeting our targets for net zero. Is my hon. Friend
aware of that, and does she agree that it is essential that the
funding is replaced?
My hon. Friend makes an excellent point. The fact is that a
number of organisations, including the European Marine Energy
Centre, are very concerned about funding going forward, given the
cuts to funding that I and many other speakers in the debate have
talked about today.
Scotland has been short-changed and her Parliament undermined. I
know the Minister thinks Scotland should be grateful, but the
post-Brexit funding bonanza has not materialised and as a result
important projects across Scotland and the devolved nations have
been jeopardised. Scotland is the poorer for Brexit in so many
ways. I hope the Minister will at least recognise the loss of
funding that Scotland and the other devolved nations have
suffered as a result and all the other concerns that he has heard
about today. I really hope that when he gets to his feet, he will
make a genuine attempt to address those concerns.
5.08pm
(Weaver Vale) (Lab)
It is a pleasure to serve once again under your chairmanship, Sir
Edward, and to contribute to the debate. My sincere thanks go to
the hon. Member for Belfast South () for securing today’s very
important debate.
We have heard some excellent contributions from hon. Members of
different parties who represent communities across our devolved
nations. The hon. Member for Belfast South spoke about local
charities needing security and sustainability in order to
continue with their excellent work in her community in Northern
Ireland. She referred to the programme as “learn and earn”, and I
certainly wish such programmes well in the future.
The hon. Member for Strangford () made a very powerful contribution and spoke
eloquently about the need to have not a penny less, in order to
shape a bright future for all the communities in Northern
Ireland. My hon. Friend the Member for Merthyr Tydfil and Rhymney
() referred to the
Westminster-centric approach of levelling up and the shared
prosperity fund, and to the need to work in partnership with the
Government in Wales and with local government so they can shape
their own destiny. The hon. Member for North Down () correctly derided the notion
of taking control. If we look at levelling up and the shared
prosperity fund, the reality on the ground is anything but that
of taking control.
Even though the Government have touted the shared prosperity fund
as a central pillar of their levelling-up agenda, serious
questions remain. The Minister will no doubt ask us to wait until
the formal launch, when all questions will be answered. However,
important questions need to be answered now, as eloquently argued
by the hon. Member for Belfast South. Fundamentally, we cannot
escape the fact that this funding is worth only 60% of the EU
funds it is replacing. How do the Government reconcile cutting
40%, which is a considerable share of the fund, and claiming to
level up at the same time?
The Government are trying to hide behind rhetoric that tells the
public that they are investing in them and in communities that
the Government have left behind for close to 12 years, when they
are doing the exact opposite, on top of a clear breaking of
important manifesto pledges, as stated across the Chamber today.
The Government said they would match funding to devolved nations,
but clearly that is not the case. The evidence is there to see.
Concerns have also been raised that the chosen delivery
geographies—essentially, lower tier and unitary authorities—will
result in inefficient procurement and fragmented and duplicated
services. Indeed, some Members have argued powerfully that, in
some cases, devolved Governments have been ignored
completely.
We have heard concerns from Members representing all the devolved
nations here today. As the Institute of Government has stated,
the shared prosperity fund
“risks damaging trust between the UK and devolved administrations
and undermining the UK government’s key objective of binding the
four nations of the UK closer together.”
As we have heard today, the “Westminster knows best” diktat is an
affront to the very principle of devolution, while giving the
Chancellor the reins to oversee funding cuts.
As my hon. Friend the Member for Aberavon () eloquently and powerfully
argued, this overly centralised scheme, devised by Ministers in
Westminster, has not seen proper engagement with devolved nations
and other stakeholders during the development of the plans for
the UK shared prosperity fund. I am sure the Minister will,
again, ask us all to wait for the full prospectus to be
published. Given the scant involvement of the devolved nations
that has been permitted so far, and the scant detail provided so
far, he can hardly be surprised that he has been asked to attend
this important debate today.
Finally, as mentioned by the hon. Member for Belfast South, can
the Minister discuss the funding gap between the end of the
current funding and the beginning of the shared prosperity
funding, which puts community projects at risk before the shared
prosperity fund even pays out a penny? With European funding
provision ending in some areas as early as April, there is a real
funding gap and it is causing anxieties and insecurities in our
communities. Can the Minister respond to that important
question?
Our collective vision should be a programme that genuinely powers
up people, places and nations. It should have a focus on need. It
should have fairness in its DNA and put devolved nations in the
driving seat, as leaders in their localities, with not a penny or
a power taken away. I look forward to the Minister’s
response.
5.15pm
The Parliamentary Under-Secretary of State for Levelling Up,
Housing and Communities (Neil O'Brien)
It is a pleasure to serve under your chairmanship, Sir Edward. I
congratulate the hon. Member for Belfast South () on securing this important
and timely debate. It was also good to welcome the Minister of
State for the Northern Ireland Office, my right hon. Friend the
Member for Bournemouth West (), who was listening to all the
extremely important points being made as closely as I was.
Given the short time available, I will come directly to the
important points made by hon. Members. I am not here to argue the
toss with them, but to try to start to set out how we will work
together to do all these things. As hon. Members know, the shared
prosperity fund will provide £2.6 billion of new funding for
local investment by March 2025; it is a significant scheme. It
will be provided through a funding formula, rather than a
competition, which is important. While there are advantages in
funding competitions, because they get people sharpening their
pencils, there are a lot of advantages in formula allocations,
because people have the same certainty that places used to have
through some of the European structural funds.
On the point about funding, the Minister has just mentioned the
figure of £2.6 billion. Does he therefore accept that the
manifesto commitment has been broken? The manifesto commitment
was to match the previous funding, which would mean £1.5 billion
per year over a seven-year planning cycle. The comprehensive
spending review is only a three-year time horizon, so will the
Minister accept that the manifesto pledge has been broken?
Neil O'Brien
I will come to quantums later in my speech, but no, we will keep
our manifesto promises.
The hon. Member for Belfast South raised really important points,
and I hope I can start to set Members’ minds at ease. The hon.
Member for Strangford (), whose health I would have feared for had he not
been here today, was right when he said that we are all on this
journey together.
I agreed with the hon. Member for Ceredigion () when he said that we must work
with devolved Governments and local people, not over their heads.
I also agreed with the sensible speech made by hon. Member for
Merthyr Tydfil and Rhymney (), who said that we must use
the experience of local partners who know what is needed and how
to run these kinds of schemes.
In Scotland, Wales and Northern Ireland we are very clear that we
want local partners, at all levels, to be able to shape what is
done to this funding and how it is allocated. In Northern
Ireland, we have a unique local government landscape in our work
on the UKSPF, so we proposed to deliver at a Northern
Ireland-wide scale, which will enable us to have an allocation
that is felt to be fair by all communities and that will make the
most of all the fantastic opportunities that there are across
Northern Ireland.
The development of that single Northern Ireland plan will draw on
the insight and expertise of local partners, including the
Northern Ireland Executive, local authorities, businesses, the
community and the voluntary sector, in order to maximise all the
local intelligence, insight and knowledge that they have. We have
engaged with the Northern Ireland civil service, the Northern
Ireland Local Government Association and Solace on UKSPF.
I have also reached out to the Northern Ireland Executive’s
Minister for Finance and I plan to discuss the UKSPF further with
him on Thursday. I had a very useful meeting with Minister
Lochhead from the Scottish Government on Friday, and I am setting
up a meeting with of the Welsh Government, as
well. We are keen to work with all of the devolved
Administrations to shape the way this funding is used.
When the Secretary of State for Levelling Up, Housing and
Communities delivered his statement on the levelling-up White
Paper, he acknowledged to me that the First Minister was advised
of an innovation accelerator that was being put into Glasgow in a
phone call only the night before. Can the Minister guarantee that
that sort of behaviour will not continue in the future?
Neil O'Brien
I think that innovation accelerator is terribly exciting, but I
can guarantee to the hon. Lady that as part of UKSPF we are
engaging at all levels with devolved Governments and other local
partners with important expertise. We will also be setting up an
inter-ministerial group, with ministerial representation from all
the devolved Governments, so that we have a regular forum on the
breadth of my Department’s work to discuss these matters and to
ensure there is an open dialogue across the whole UK.
The UKSPF has been designed to empower local places in all four
nations of the UK. My Department is engaging with local
government associations—including the Local Government
Association, the Convention of Scottish Local Authorities, the
Northern Ireland Local Government Association and the Welsh Local
Government Association—ahead of and following the publication of
the pre-launch guidance.
We will continue to engage with the devolved Governments and
wider partners on the design and operation of the fund so that we
can get the best outcomes across all the UK, because there are so
many different priorities. The hon. Member for Strangford talked
about fishing communities, and we heard from the hon. Member for
North Down () about important community
groups. There are many different partners that we have to engage
in shaping this important programme.
We are engaging with the Northern Ireland Executive at an
official level regarding the concerns they raised about
programmes that are currently running under the European social
fund. That dialogue will help to push on arrangements that
maximise that fund delivery in Northern Ireland. However, it is
worth thinking about the totality of these different funds
because, as well as the shared prosperity fund, we also have the
levelling-up fund and the community renewal fund, which is a
one-year fund to transition us on to the UKSPF.
For Northern Ireland alone, if we look at some of those different
sources of funding, my Department has provided £49 million via
the levelling-up fund, £12 million as part of the community
renewal fund, and funding through the community ownership fund,
which enables different community groups to take things into
community ownership. At the same time, we have made important
long-term commitments in Northern Ireland, as in Scotland and
Wales, through the city and growth deals. In Northern Ireland,
those are worth £670 million—funding that is being matched by the
Northern Ireland Executive. That is in addition to Northern
Ireland-specific schemes, such as Peace Plus.
One of the challenges on my mind, as a Minister, is how we can
all work together to ensure that the schemes work in such a way
that they are more than the sum of their parts. I am conscious
that there are a number of different schemes there; how do we
ensure that the totality of the opportunities in Northern
Ireland, which are very exciting, are best served by the
confluence of all these different funding streams? It is useful,
through t UKSPF, to have some funding that is not challenge-based
but formula-based, and therefore, in that sense, a bit more
flexible to provide bits of match funding to complement those
other, existing funding streams.
The Minister mentioned the importance of his Government working
in partnership with the devolved Governments. I am sure we are
all pleased to hear that. Would he therefore like to comment on
the conclusion of the House of Lords Constitution Committee in
its report in January that the UK Government have ignored—and
continue to ignore—devolution and the devolved Governments in
this process?
Neil O'Brien
There will always be a range of views on these questions. As my
Secretary of State set out in his evidence to the Scottish
Parliament the other day, our strong belief is that all these
things will work best if we can engage not just the devolved
Governments but local partners across the whole the UK.
It is worth putting these issues in the context of the wider
funding settlement, as well as the funds that are specific for
regeneration and community renewal. In the spending review, hon.
Members will have seen that we have £15 billion for Northern
Ireland annually for the next three years—the highest figure
since devolution. There will be £41 billion for Scotland—again,
the highest figure since devolution—and £18 billion for Wales,
which is, again, the largest figure, in real terms, since
devolution. So the context is that of a wider public spending
settlement, and although we would always like to have more money
to do things, that will enable us to do some really important
things for some communities, particularly in Northern Ireland,
which experienced extremely high levels of deprivation—I think
that we would all recognise that.
Hon. Members have raised some of the things that the community
renewal fund is doing. I would stress some of the positive things
that that funding is doing, which leads into the work of the
shared prosperity fund. The hon. Member for Belfast South rightly
quoted the wise comment of her former leader that the best peace
process is a job.
The hon. Member for North Down stressed the importance of
skills—again, quite rightly. The community renewal fund is giving
half a million pounds to the NOW Group to support people with
disabilities through specialised employment academies and job
mentoring. It is also giving nearly half a million pounds to
South West College, Southern Regional College and Queen’s
University Belfast to upskill construction operatives to fill
that skills gap, and there will be just over £500,000 for a
hydrogen training academy to deliver training for 180 people, to
get a skilled workforce that can take advantage of the exciting
opportunities that are opening up in Northern Ireland in hydrogen
and clean technology. Those funds are doing a great deal of good.
By working together, we will get the most out of these different
spending streams.
The hon. Member for North Down asked a specific and very
important question about section 75. We understand the importance
of respecting the unique equalities considerations in Northern
Ireland. We recognise the importance of not only meeting our
legal obligations under the Equality Act 2010 but giving due
regard to the additional equalities considerations that apply in
Northern Ireland. I hope it is obvious from the tenor of my
comments and from what I have said today that we are
always—always—keen to have solutions that are felt to be fair by
all communities and that see all communities working
together.
I thank hon. Members, who have put forward genuinely important
points in today’s debate. Over the coming weeks, we will work
with other parts of the Government—represented here today—as well
as partners across the UK, to finalise our policy development.
Later in the spring, we intend to publish the full UK shared
prosperity fund prospectus.
I hope I have got across in my comments the sense that our intent
is not to go over the heads of anybody but to enable devolved
Governments, local government and other partners to shape what is
done in different parts of the UK and where the money goes, and
to be involved in generating and contributing ideas at all
levels, so that we can make the most of the opportunities that we
collectively share. That is the tenor of where we are coming from
on this entire agenda.
Once we have done that—we will be doing it, as Members can
probably tell from the meetings I have talked about that are
under way or that are forthcoming— we will publish the full UK
shared prosperity fund prospectus. We want to try to keep the
process as simple as we can so that we can give local partners
the information they need to begin investment planning. I
genuinely look forward to working with hon. Members from across
this House; a number of them have already come to me with
important suggestions and ideas about things we can do on this
agenda. I look forward to working with all Members who are here
today to deliver on our shared ambition.
5.27pm
I thank Members for their participation and for their points. My
constituency near-neighbour, the hon. Member for Strangford
()—I concede it is a very beautiful place—set a very
helpful and constructive tone, but Members across the House have
reflected a concern or two. Colleagues coming from different
political perspectives in Wales were certainly on the same page
about the risks to devolution and the anxiety that the gaps in
information have created.
The hon. Member for North Down () asked some key questions,
based on his experience as a skills and employment Minister with
a lot of first-hand experience of driving and directing the
predecessor funds. He asked some important questions about
equality impact assessments, particularly in relation to Northern
Ireland.
The hon. Member for North Ayrshire and Arran () gave a comprehensive and
convincing summary of Scotland’s concerns and presented some very
stark figures that I, too, would have liked to hear the
Minister’s response to and that I completely understand will have
breached the faith and confidence of people in Scotland.
The hon. Member for Weaver Vale () and the hon. Member for
Aberavon (), who is the chair of the
all-party parliamentary group, reflected the concerns about a
Whitehall-led, top-down approach. I was made aware that at a 2019
Conservative leadership hustings in Cardiff, the now Prime
Minister pledged a strong Conservative influence over these
funds, but people in Northern Ireland, Scotland, Wales and many
other parts of the UK have expressed different aspirations and
have different needs, which must be respected and protected.
Delivery partners with decades of experience, as well as ideas
and track records, are clearly ready across the different regions
to play a part, to build the economy and to ensure that everybody
has the skills and the capacity to access the economy. However,
there needs to be a joined-up approach. The Minister referred to
the city deals, which work precisely because they work from the
bottom up, catalysing private investment and doing so by having
direct partnerships with local business and research
partnerships.
As I say, seeing is believing. I gave the example that in
Northern Ireland a vacuum of information was followed by an
alarming allocation that raised even the most benign eyebrows in
Northern Ireland. So I appreciate the tone of the Minister’s
response about how people will be engaged, but I have to say
that, in the absence of further information on the parameters of
the fund and how it will engage with devolved Administrations, we
remain to be convinced.
Question put and agreed to.
Resolved,
That this House has considered the shared prosperity fund and the
devolved Administrations.
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