EU Funding

Paul Blomfield Excerpts

Tuesday 25th February 2014 Commons Chamber

[John Healey]

My right hon. Friend poses a bigger question than I would have imagined from the terms of this debate. Clearly, Scotland would have to become a part of the European Union and then to lay its claim for any potential structural funding support in the way that this programme is designed to deliver.

[Paul Blomfield (Sheffield Central) (Lab)]

I congratulate my right hon. Friend on the work that he has done in co-ordinating the concern of the South Yorkshire region over this issue. Does he agree that the perverse impacts of the way in which the Government have brought together their formula are illustrated by the fact that Cheshire, which happens to include the Chancellor’s constituency, has been allocated 34% more per head than South Yorkshire, even though its GDP is 19% above the EU average while ours is 16% below? What conclusion does he draw from the way in which the Deputy Prime Minister, although supposedly representing our region, has strongly defended the formula, which took money intended for areas such as ours and other poorer regions and gave it to wealthier areas?

[John Healey]

First, the Deputy Prime Minister was asleep on the job when the decisions were taken in government. Secondly, he is allowing the arguments that we have heard from other Ministers in this Chamber to pull the wool over his eyes. He has not been standing up for South Yorkshire, and I see this as a Forgemasters mark 2 against the card of the Deputy Prime Minister.

A more measured reflection on the figures that my hon. Friend has just given allow me to continue to develop my argument, which is that the Government’s approach to date does not apply the principles of equality and proportionality. Similar regions were treated differently, and allocations were not proportionate to their needs. I say to the Secretary of State that we will not let this matter rest. We will take it all the way. Our councils will take the case to the Appeal Court to ensure that the principles are taken into account by the UK Government, just as the EU does in designing and allocating the structural funds in the first place. We will also take the case to Commissioner Hahn, who has to approve UK Ministers’ plans to ensure that those principles are taken into account.

The High Court judgment two weeks ago requires Ministers to review, but not necessarily to change, the funding decisions. I urge the Secretary of State to take a fresh and deep view of this set of decisions. He should revise those decisions now rather than being forced to do so later.

Let me take the Secretary of State back to what his junior Minister, the right hon. Member for Sevenoaks (Michael Fallon), said in the first debate. He rightly said:

“The aim of the funds is to provide EU member states and regions with assistance to overcome structural deficiencies and to enable them to strengthen competitiveness and increase employment.”—[Official Report, 1 July 2013; Vol. 565, c. 725.]

The EU funds are designed to give a boost to the economy of flagging regions. It is an outrage that areas of the UK with more jobs, wealth, businesses and prosperity are also getting more European funding in the period ahead. South Yorkshire is one of those 11 transition regions in the UK, which means that our GDP is between 75% and 90% of the European average. All the more developed regions have a GDP of at least 90% of the European average. Nine of them will receive more, not less, funding than the Sheffield city region. They include Worcestershire and Leicestershire. As my hon. Friend the Member for Sheffield Central (Paul Blomfield) has said, they also include Cheshire and Warrington, which have a GDP not of 84% like South Yorkshire but of 119% of the European average and will get EU funding not of €117 per head like South Yorkshire but of €157 a head.