Millions of pounds lie unallocated while growth has flatlined.
Labour is calling on the Tory-led Government to get a grip and sort out the mess surrounding EU funds for regional growth, which is putting 28% for Cornwall at risk.
The unallocated funds are part of the European Regional Development Fund (ERDF), which exists to boost growth and jobs regionally, particularly in disadvantaged areas.
The Government has yet to put in place a mechanism for allocating the funds, following the hasty and chaotic abolition of the Regional Development Agencies (RDAs) which used to manage the process. European Commissioners have raised real concerns that the funding could be jeopardised as a result.
If this does not take place in time, two thirds will automatically revert to the Treasury’s coffers. According to the most recent government figures, £1,160m – 41 per cent – of ERDF funding for England is still unallocated.
Last month, BIS Minister Mark Prisk felt compelled to write to local decision makers urging them to look at national matched funding opportunities given the slow progress on allocating the funds in the past year and the RDA abolition which in his own words has “provided an additional challenge to your work”.
Gordon Marsden MP, Labour’s Shadow Minister for Further Education, Skills & Regional Growth, commenting, said: “It beggars belief that when Cornwall is crying out for cash and investment to boost jobs and growth, this Government’s actions are putting £110 Million of potential funding at risk, and over £1billion across England.
“It is symptomatic of the shambolic and chaotic way in which the regional development agencies were abolished, that they had no plan to allocate this cash for jobs and growth to where it is needed. There are real concerns that if the Government drags its feet longer, the money could be clawed back centrally by the Treasury.
“Ministers need to get a grip to ensure this money gets out to the English regions and helps boost growth and jobs which are flatlining as a result of the Tory-led Government’s policies. We need leadership and urgency from ministers, but instead we have seen dither, delay and uncertainty demonstrating how out of touch they have become with the needs of businesses up and down the country.
“Labour’s five point plan would help boost regional growth now with a one year National Insurance tax break for small firms taking on extra workers and bringing forward long-term investment projects.”Other news from Cornwall Labour