In a statement released on Saturday setting out the future of European funding in the UK following the vote to leave, Hammond said government would also maintain funding where UK organisations bid directly to the European Commission on a competitive basis for EU funding projects. For example, for universities participating in Horizon 2020, the Treasury will underwrite the payments of such awards, even when specific projects continue beyond the UK’s departure from the EU.
He also announced that the government would guarantee that the current level of agricultural funding under CAP Pillar 1 will be upheld until 2020, as part of the transition to new domestic arrangements.
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 the EU, Hammond said.
“We recognise that many organisations across the UK which are in receipt of EU funding, or expect to start receiving funding, want reassurance about the flow of funding they will receive,” he stated.
“That is why I am confirming that structural and investment funds projects signed before the Autumn Statement and Horizon research funding granted before we leave the EU will be guaranteed by the Treasury after we leave. The government will also match the current level of agricultural funding until 2020, providing certainty to our agricultural community, which play a vital role in our country.”
The full list of funding areas that will be guaranteed if projects are agreed before the Autumn Statement include the Regional Development Fund, the European Social Fund, the European Agricultural Fund for Rural Development (CAP Pillar 2) and the European Maritime and Fisheries Fund.
Many projects have pencilled in European funding for regeneration to 2020. Projects currently funded by the Regional Development fund include the Midlands Manufacturing Growth Programme (£9m), Carluddon Technology Park in Cornwall (£6.2m), and the Manchester Graphene Engineering Innovation Centre.
The Treasury also confirmed it has put in place arrangements to assess whether it will fund those projects due to be signed after the Autumn Statement, but while the UK remains an EU member.
However, the Local Government Association claimed the decision did not go far enough. Responding to the announcement, chair Lord Porter acknowledged that the move would benefit some vital growth-boosting schemes. "However, as welcome as this commitment is, it falls well short of the full guarantee we are urging the government to make,” he said.
He added that local areas needed certainty around the future of the £5.3bn in EU regeneration funding they are due to receive by 2020, which is “tied up in thousands of proposals which are yet to receive government approval.
“The continued uncertainty risks damaging local regeneration plans and stalling flagship infrastructure projects, employment and skills schemes and local growth,” he said.
He also observed that the vast majority of EU regeneration funding has yet to be distributed. For example, he said, Cornwall and the North East have only received 20% of their EU funding allocations so far, while Birmingham has only received 25%.
Porter urged the government to use the Autumn Statement to guarantee local areas receive “every penny” of EU funding they are expecting by the end of the decade, as well as honouring commitments to match-fund EU monies with domestic fundin
