Economy and Infrastructure

06.12.17

Councils demand clarity on £8.4bn Brexit funding gap

The LGA has today urged the government to explained how it plans to replace the current EU Structural Funds after Brexit.

The local authority representative says an £8.4bn funding gap will open in local communities immediately after the UK leaves the EU.

In its manifesto the government has said it would create a UK Shared Prosperity Fund (UKSPF) to replace the financial loss to councils, but the LGA is becoming increasingly concerned with the lack of detail on this front.

Speaking to the Communities and Local Government Select Committee today, Cllr Kevin Bentley, chairman of the LGA’s Brexit Task and Finish Group, said more clarity was “urgently needed” on funding that is used to create jobs, support skills and business, and invest in infrastructure and growth.

“The very nature of local government means we are very close to the residents we serve so this is about people, their jobs, their family and it is hugely important,” Bentley said.

“We are certainly talking to the government about this funding and the critical timeline on the funding.”

After attending the committee, he further explained his fears: “Negotiating our exit from the European Union is clearly a huge task, but the clock is ticking to ensure Brexit does not leave local areas facing huge financial gaps as a result of lost regional aid funding.

“We want to urgently work with the government to help develop a fully-funded and locally-driven successor scheme with local government in areas of all types.

“With national funding for regeneration increasingly being depleted, all local areas have become increasingly reliant on EU money and local areas are desperate to get on with creating jobs, building infrastructure and boosting growth.”

Clive Betts, chair of the committee, said: “It's important that local government is not overlooked in Brexit negotiations especially given the impact it might have on investment, development and funding for councils”

The LGA has said it is looking to replace the Structural Funds with a more place-based system that will enable local areas to set their own priorities and adapt to the future changes of post-Brexit Britain.

To that end, the association has produced a ‘Beyond Brexit’ report, which aims to represent research and options on the planning of the UKSPF.

Top image: Andrej K

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