Lord Watts
Main Page: Lord Watts (Labour - Life peer)EU Funding (Rotherham and Barnsley)
Lord Watts Excerpts
John Healey
Indeed. The hon. Gentleman sums up my full argument in a nutshell, and I am grateful to him for that.
Mr Watts
Is not the key point that the Government have taken money from some poor parts of the country and given it to other poor parts of the country? If we look at Cheshire and Warrington, for example, although its GDP is at 119%, it will get £157 compared with Sheffield’s figure, which is less, and Merseyside’s, which is less. How can it be right for a more affluent area to get more funding per person than some of the most deprived parts of Britain?
John Healey
Over the last year, my hon. Friend and I have campaigned for special transition region status for the purposes of the new European funding programme, and have tried to persuade the Minister of the case. My hon. Friend has anticipated some of the points that I shall be making later, which lie at the heart of the problem. I want to deal with the facts, the fix and the future. I want the Minister to confirm the facts, explain the fix, and pledge to make good the funding of our areas for the future.
Let me begin with the facts. As the Minister knows, I welcome the commitment to the European regional development fund and the European social fund as part of a European budget settlement that represents the first-ever real-terms cut overall. I welcome the inclusion of transition region status for ERDF purposes, although the Government held out against it until the final agreement. I welcome, in particular, the Minister’s commitment in his statement on 27 June to a local rather than a central programme, with decision-making powers in local areas. I also welcome the decision to enable European funds to take their place as part of the strategic plans of the local enterprise partnerships.
We know how to use European funding in South Yorkshire, we know how to use it well, and we have firm plans for its use in the future. The advanced manufacturing park on the edge of Rotherham would not be there without support from European funding, and the nuclear advanced manufacturing research centre and the knowledge transfer centre in Rotherham would not be there without £15 million from the ERDF. We have plans for the future. We can put the money to good use, and that will include support for the city deal and for 4,000 extra apprenticeships throughout South Yorkshire.
However, whereas our current seven-year programme of funding from the European Union is worth is worth more than €400 million in South Yorkshire alone, the new seven-year funding programme will provide €203 million, not just for South Yorkshire but for the five north Nottingham and north Derbyshire districts as part of the Sheffield city region. As was pointed out by my hon. Friend the Member for St Helens North (Mr Watts), that is about €117 per head in an area with a population of nearly 1.8 million and a GDP that is 84% of the European average. It represents a cut of more than 50% in South Yorkshire’s funding for the current seven-year period.
Ours is one of the 11 transition regions in the United Kingdom. That means that our GDP is between 75% and 90% of the European average. Which economies have been earmarked for extra funding to boost jobs, skills and businesses? All the more developed regions have a GDP of at least 90%, and nine of them will receive more, not less, funding than the Sheffield city region. They include Worcestershire, Leicestershire and, as my hon. Friend said, Cheshire and Warrington. Cheshire and Warrington has not a GDP of 84% like South Yorkshire but a GDP of 119%, and will receive EU funding of not €117 a head like South Yorkshire, but €157 a head.
Michael Fallon
What is true is that South Yorkshire is transitioning. It was a poorer region and is now becoming a wealthier region. Let me repeat: in each of the next seven years, South Yorkshire will get more than in the past three years. Really, we need to be very clear about this.
Michael Fallon
I think I have been very generous in giving way.
What is a transition region? It is a category of region introduced to support those that have a GDP level between 75% and 90% of the average. It means that those regions are no longer eligible for the highest levels of support—that for the so-called less developed regions—and nor are they considered more developed regions. “Transition region” means that they will get benefits providing greater flexibility in how to spend the funding. I want to highlight that during the current funding regime, for which the right hon. Member for Wentworth and Dearne was responsible as one of the Ministers involved, 50% of the funding was retained by central Government to determine how it was spent. I am sure that that was expedient to the effective delivery of Government programmes and so on, but I am very pleased that in the seven years beginning next year, local areas will define and have at their disposal 95% of all the funding available. Of course it is true that some areas would have had higher levels of funding in the past, but they will certainly be able to direct more of the money they want in the same way.
Michael Fallon
I am sorry, but I only have a minute left.
I have focused my remarks on the structural funds, but that is not the only way in which we are helping South Yorkshire. We have granted enterprise zone status across the Sheffield city region, we have a city deal leading to £72 million in public and private investment and we have a transport fund that could be worth £500 million to the Sheffield city region. No other transition region has a deal like that. More than £80 million has been awarded through the regional growth fund, including a local enterprise partnership-led £25 million unlocking business investment programme.
The footprint of all that growth will be approximately 2,000 sustainable private sector jobs. In Rotherham, we are supporting the advanced manufacturing research—