Shared Prosperity Fund: Devolved Administrations

Claire Hanna Excerpts

Tuesday 1st March 2022 Westminster Hall

[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 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.

[Jonathan Edwards (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.

[Claire Hanna]

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.

--- Later in debate ---

[Claire Hanna]

I thank Members for their participation and for their points. My constituency near-neighbour, the hon. Member for Strangford (Jim Shannon)—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 (Stephen Farry) 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 (Patricia Gibson) 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 (Mike Amesbury) and the hon. Member for Aberavon (Stephen Kinnock), 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.