Financial support promises derided as inadequate by devolved governments
POLITICAL EDITOR
BY TOM GORDON
TREASURY plans to plug the funding hole left by Brexit “fall far short” of what Scotland’s communities and businesses need, Finance Secretary Derek Mackay has warned.
Reacting to Chancellor Philip Hammond’s announcement that he would guarantee billions to replace disappearing EU funds, Mackay said the help “simply isn’t good enough”.
It could leave Scotland up to £750 million worse off than it is under EU membership, he said.
“It puts at risk significant investment and jobs, revealing the reality of Brexit,” Mackay added. “Scotland didn’t back Brexit and doesn’t want Brexit. We certainly should not now see funding and investment in communities hammered as a result of Brexit.”
Last night, Mackay wrote to Chief Secretary to the Treasury David Gauke seeking more clarity and “comprehensive, long-term guarantees” on which funding streams would survive.
The other devolved governments also voiced concerns, with Welsh First Minister Carwyn Jones complaining Hammond’s guarantee only covered about half of the regional funding due to Wales and did “not provide the longterm certainty needed”.
Northern Ireland Finance Minister Máirtín Ó Muilleoir added that while some applicants for EU funds would be helped, there remained a “question mark over scores of other vital projects”.
Hammond announced on Friday that the Treasury would guarantee up to £6 billion a year for projects funded by the EU after Brexit, including farm subsidies and science grants.
The backing covers projects signed before this year’s Autumn Statement.
Current levels of agricultural funding will continue until 2020, but after that there will be a “transition to new domestic arrangements”.
Universities making research funding bids to the European Commission, including the EU’s £69bn Horizon 2020 programme, will also have their funding guaranteed, Hammond said, even if projects continue past Brexit.
The Chancellor said: “The UK will continue to have all of the rights, obligations and benefits that membership brings, including receiving European funding, up until the point we leave Finance Secretary Derek Mackay says the Chancellor’s plans to plug the funding hole left by Brexit ‘fall far short’ of what Scotland’s communities and businesses need the EU. We are determined to ensure that people have stability and certainty in the period leading up to our departure from the EU.”
Mackay responded: “We will study the detail but what is already clear is the Chancellor’s approach falls far short of what fishermen, farmers and communities across Scotland need.
“Major funding streams such as contracts for EU structural funds and European Maritime Fisheries projects beginning after the Autumn Statement have no guarantee of continuation.
“Since the EU referendum, we have urged the UK Government to provide clarity and certainty on these vital funds. Yet, all that is clear with this announcement is uncertainty will continue.”
Shadow chancellor John McDonnell welcomed Hammond’s decision “to agree with Labour’s calls for EU structural funds to be protected post-Brexit”, but added he must also “speak up on the importance of keeping Britain’s membership of the European Investment Bank”.
The Royal Society president Sir Venki Ramakrishnan said some scientists had already missed out on collaborative projects because European colleagues were worried about funding.
He told BBC Radio 4’s Today programme: “We have been hearing anecdotal reports of people not being willing to collaborate with certain UK collaborators because they weren’t sure that they would be able to stay for the full duration of the grant.”
Professor Dame Anne Glover, University of Aberdeen dean for Europe, added: “The research community needs to continue pressure to ensure this commitment is fully honoured. Without a clear understanding of the link between science, engineering and technology and our economy, the Government may inadvertently compromise our future.”
British Chambers of Commerce acting director general Adam Marshall welcomed the increased clarity over funding. But he added: “The delays that many worthwhile projects face in the approval process must also be cleared away – especially given the fact that the Treasury guarantee only covers projects signed by this year’s Autumn Statement.”
The SNP also called for a swift decision to boost airport capacity in southeast England, with a beneficial knockon effect in Scotland, by approving expansion of Gatwick or Heathrow.