The UK Government has failed to agree a deal with the European Commission which would release £724m of vital job creation funds for the North East. Jude Kirton-Darling, Labour Member of the European Parliament for the North East secured a meeting with the responsible Commissioner in Brussels. The Commissioner confirmed that the responsibility to complete the deal was with the UK Government.
The North East receives various funds from the European Union which are used to invest in projects which create jobs and growth. Examples include investment in the newly opened small business incubator space in Blyth and the new office building currently being constructed on Newcastle Quayside.
In the past European Funding was distributed by Regional Development Agencies. They were recognised by the European Commission as intermediate bodies and were accountable to Parliament. The Government proposed that funds would be allocated by Local Enterprise Partnerships (LEPs) which do not have these accountability structures. When the Commission questioned the arrangements the Government has effectively centralised the programme and decisions will be taken in Whitehall that were previously made in North East.
The delay to the programme is particularly significant for the Youth Unemployment Initiative which will release millions of pounds to help get young people into work. The deadline for spending the money is shorter and as such any delay in releasing the funds will have a real impact.
Jude Kirton-Darling MEP said “European funding is vital to the region and we need it now more than ever after years of cuts to other funding streams. It is unacceptable that the Government has ultimately delayed the release of the money. The Commissioner confirmed that the ball is firmly in the UK Government’s court.”
“I am really concerned that the programme will be managed from Whitehall when we know here in the region what works best. It’s a betrayal of any notion of devolution to local areas. We’re already starting to see the effect of this central management of the programme. The North East LEP had included not for profit organisation in the programme but this was removed by the Government. As a region we have a vibrant not for profit sector and as such this will hit us hard.”
“I have pressed for there to be flexibility to allow the money to be spent once it is agreed but we have been badly let down by the Government.”