27 February 2004
Local and regional government leaders are urging Chancellor Gordon Brown to stop opposing a substantial increase in the European Commission's budget, so that the UK's four poorest regions can continue to receive economic aid.
After the EU admits ten new member countries on May 1, only Cornwall will retain its 'objective one' status, which grants generous funding to areas where average gross domestic product is less than 75% of the EU's average. The other three areas, West Wales and the Valleys, Merseyside and South Yorkshire, will lose their status.
But, under plans unveiled by regional policy commissioner Michel Barnier this week, they would continue to get transitional funding until 2013.
However, Barnier has warned this is only possible if Brown, who has led calls for the EU budget to be capped at 1% of GDP, agrees to let it rise to 1.14%.
The Local Government Association and the Welsh Assembly were due to meet government officials this week to push for a generous settlement. David Sparks, chair of the Local Government Association's economic regeneration committee, said: 'We will now work hard to persuade the government to reflect our views in its official response, but this won't be easy.
'We know there are differences between those who want a cautious, targeted budget and those who would prefer a more substantial budget in line with the task of EU expansion, but we think the commission's proposals get it about right.'
Welsh First Minister Rhodri Morgan said objective one funding had delivered significant benefits to Wales. 'I certainly would not want to see that programme come to a juddering halt on January 1, 2007,' he said.
PFfeb2004
