Brexit: Government to guarantee project funding

Philip Hammond

Chancellor Philip Hammond has issued assurance that levels of funding for businesses and public projects remain certain while the UK remains a member of the EU, despite the Brexit vote. A government statement released late last week said all key projects signed off before this year's Autumn Statement will receive a guarantee of funding even if their timescales extend beyond the date when the UK formally leaves the EU.

The Treasury is also putting in place ways of assessing whether specific EU funded schemes can be underwritten after the Autumn Statement. The chief secretary to the Treasury, David Gauke, has written to each devolved administration to confirm they will get the same assurances where they expect to rely on EU funding.

Hammond's satement said: "The UK will continue to have all of the rights, obligations and benefits that membership brings, including receiving European funding, up until the point we leave the EU.

"We recognise that many organisations across the UK which are in receipt of EU funding, or expect to start receiving funding, want reassurance about the flow of funding they will receive.

"That is why I am confirming that structural and investment funds projects signed before the Autumn Statement and Horizon research funding granted before we leave the EU will be guaranteed by the Treasury after we leave. "

In response, the Local Government Association said Hammond's statement was welcome, but did not go far enough for local goverment and regions.

"The Government's commitment to honour existing agreed projects reliant on EU money will help get some vital growth-boosting schemes off the ground. However, as welcome as this commitment is, it falls well short of the full guarantee we are urging the government to make," said LGA chaiman, Lord Porter.

"Local areas need certainty around the future of all of the £5.3 billion in EU funding promised to them by 2020. The continued uncertainty risks damaging local regeneration plans and infrastructure projects, employment, skills schemes and local growth."

The vast majority of EU regeneration funding remains tied up in thousands of proposals which are yet to receive government approval, the LGA said. Cornwall and the North-east have both only received 20% of their EU funding allocations so far. Birmingham has only received 25%.

Local government secretary, Sajid Javid said: "Local Enterprise Partnerships are a vital part of our efforts to rebalance the economy, and have helped create thousands of jobs over the past five years. Guaranteeing EU funding will further support this work, enabling LEPs to plan ahead with certainty. This will be crucial as we work together to take advantage of the opportunities presented by the UK’s decision to leave the European Union."






This only applies to funding from Europe, not financing - so does not replace or supplement EIB's role.