EU Structural Funds: Least Developed Regions

Debate between Paul Blomfield and Sheryll Murray

Wednesday 26th June 2019 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

I beg to move,

That this House has considered replacement of EU structural funds for least developed regions.

It is a pleasure to see you in the Chair, Ms McDonagh. I am grateful that this issue has been selected for debate. I thank colleagues across parties and regions for supporting the application, particularly the hon. Member for Truro and Falmouth (Sarah Newton), my right hon. Friend the Member for Cynon Valley (Ann Clwyd), who is not currently in her place, and my hon. Friend the Member for Redcar (Anna Turley).

The application for this debate followed a report by the Conference of Peripheral Maritime Regions that crystallised concern that our regions should not lose out as a result of the decision made in the 2016 referendum. I intend to speak relatively briefly because I want to give plenty of opportunity to colleagues from across the regions to make their points. I have only one question for the Minister, but I will come to it at the end.

The CPMR report estimated that if the UK had remained in the European Union, we would have been entitled to €13 billion, or £11 billion, of support from EU structural funds—primarily the European regional development fund and the European social fund—during the next period, from 2021 to 2027. However, five regions would be set to receive a bigger share of that funding based on our position as having some of the poorest areas in Europe. Those areas are defined as “least developed regions” because our GDP falls below 75% of the European average. Clearly, that is not something that we should be proud of and it needs to be addressed.

Cornwall and the Isles of Scilly, and west Wales and the valleys both already receive funding for that category.

[Mrs Sheryll Murray (South East Cornwall) (Con)]

Does the hon. Gentleman accept that we have already contributed that money to the European Union and are getting it back?

[Paul Blomfield]

I agree. The European Union has demonstrated itself to be a very effective redistributive mechanism, taking from richer areas and redistributing to poorer ones. In my area of South Yorkshire, I imagine that we are a net beneficiary of that, although the UK as a whole is a net contributor.

Cornwall and the Isles of Scilly and west Wales and the valleys are already recipients of funding for that category, but have been joined by Tees Valley and Durham, Lincolnshire and my own region of South Yorkshire, because those three regions have now sunk below the 75% threshold, too.

In preparing for the debate, I consulted the House of Commons Library, which, as ever, provided excellent independent assessment and support—I commend those in the Library for the work that they always do for us—and confirmed the CPMR analysis. The Library said that, if anything, the CPMR report underestimated the position because it had not taken account of southern Scotland, which would have been eligible, and added that

“the ‘Outer London – East and North East’ region is also on the borderline”

for classification for support. The amount of funding for which UK regions could have been eligible may have been even higher than in the CPMR analysis.

Leaving the European Union

Debate between Paul Blomfield and Sheryll Murray

Monday 4th February 2019 Westminster Hall

[Paul Blomfield (Sheffield Central) (Lab)]

It is a pleasure to wind up for the Opposition with you in the Chair, Mr Hanson. I congratulate the hon. Member for Sutton and Cheam (Paul Scully) on his introduction to the debate. I did not agree with absolutely everything he said, which he will not be surprised to hear, but he set the framework for the discussion in his characteristically thoughtful way, so I thank him.

The hon. Gentleman was right when he talked about the passions around this debate. The number of Members here today reflects the fact that we have had days, weeks and months exercising those passions, and there is an important statement in the Chamber at the moment. There are many issues that we could discuss—many have been touched on—but I will focus on the specific issue of the petition in relation to the extension of article 50.

We need honesty in this discussion. The Prime Minister could have given a lead in her answers over recent days by recognising the complexity of the issue and the different challenges that we face, but on this—as so often before—she has reduced things to a simple binary yes or no: we will or we will not. She has been digging herself into a position, as she has so many times on Brexit over the past couple of years, that will change when she is confronted with a cold dose of reality.

It all started with the phasing of the negotiations. As Members will remember, the Prime Minister insisted that there would be no separation of the discussion on withdrawal from the discussion on our future relationship. Back in 2016, the first Brexit Secretary, the right hon. Member for Haltemprice and Howden (Mr Davis), promised the “row of the summer” on that issue, until he rolled over without dissent because he recognised that that was the way that things would inevitably go.

Then there was the transition. Recognising the risks of a cliff-edge departure on 29 March, we argued back in August 2017 that there should be a transitional period and that business should not have to adjust to different sets of regulations as we left. “No”, said the Prime Minister: No. 10 said that was

“a weak attempt to kick the can down the road.”

That comes from the can-kicking experts. When she secured the transition in March 2018, she claimed that it—or, as she then described it, “the implementation period”—was one of the great achievements of her negotiations. Then we had the mantra of “no deal is better than a bad deal.” Some of the nonsense around that has fuelled the idea that we might crash out on whatever terms, or in the absence of any terms, on 29 March. It was nonsense, but it was endlessly repeated—“no deal is better than a bad deal”—until the Prime Minister struck a bad deal, which will shrink the UK economy by 4%. Then she slipped into reverse gear, with a new mantra, which said, “Support my deal, because the alternative of no deal would be disaster for the country.”

[Mrs Murray]

Will the hon. Gentleman explain why the leader of his party would take no deal off the table? Is that not a bit like a trade union going over to Europe and leaving strikes at home as an option, when they were negotiating?

[Paul Blomfield]

We are very clear why we would take no deal off the table. As the Prime Minister now acknowledges, as the Chancellor has spelled out and as the Treasury analysis has demonstrated, it would be a disaster for the economy.

[Mrs Murray]

Will the hon. Gentleman give way?

[Paul Blomfield]

If the hon. Lady lets me finish the point, she can intervene again. By the Government’s analysis, no deal would shrink the economy by about 10%. The impact would be particularly negative in manufacturing areas, many of which have been left behind in the period of economic change we have seen over the last generation.

--- Later in debate ---

[Mrs Murray]

As I understood the Government figures, they said that the economy would not grow as much as it would have done, in the short term—not that it would shrink. Secondly, when someone is entering into a negotiation, surely taking their main negotiating lever off the table means they will roll over and cave in. That seems to be the message we are getting from the Leader of the Opposition, and his party.

[Paul Blomfield]

The hon. Lady is right, although she is playing with words, on the Treasury analysis. It is not that the economy would shrink 10% from the point where it is now; it would shrink 10% from the point where the Treasury projects it would otherwise be. The net effect is that we would be 10% worse off through a no-deal Brexit.

[Paul Blomfield]

Thank you, Mr Hanson.

[Mrs Murray]

Apologies, Mr Hanson.

[Paul Blomfield]

There would be 10% less money for public services, 10% fewer jobs, and we would be 10% less wealthy than we would otherwise be. The Treasury was right to share that with the British people.

As to a no-deal Brexit as a negotiating lever, it has value only if those on the other side of the negotiations believe that it is meant seriously. No one thinks that a no-deal Brexit is in the British interest, and no one believes it will influence the outcome of the negotiations.