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Stephen Byers, the trade and industry secretary, will this week attempt to resolve a row with Brussels that is hold...
Stephen Byers, the trade and industry secretary, will this week attempt to resolve a row with Brussels that is holding up EU investment worth more than£2bn a year in the UK's poorest regions.

The Financial Times (p2) reports that the minister will meet Mario Monti, the EU's competition commissioner, to discuss a dispute that has delayed approval of a new assisted areas map.

The row was sparked when the government decided to base the map on wards, rather than districts or travel-to-work areas. It believes that by using wards it can target aid more effectively after the commission demanded a reduction of a fifth in the population covered by the map.

But the commission fears the move would undermine its attempt to concentrate aid on fewer areas.

A UK minister said the assisted areas row 'must be solved within weeks'. Tony Reid, of Eurofi, a UK-based grants consultancy, said: 'This could be a very serious problem indeed.'

Companies planning projects in areas covered by the old map rushed through applications before the end of the last year, but areas such as Stoke on Trent and Luton, which qualify for the first time under the new map, are becoming frustrated.

Officials from the European Commission have warned that unless the UK government can guarantee Objective 1 match-funding by the end of March, it risks losing out on£1.2bn of cash, according to Wales on Sunday (p5).

The warning comes after the EC criticised the government over funding of the aid programme in a recent report.

And the Western Mail (26 Feb, p1) reported that pressure on the treasury to properly fund the aid programme is being fiercely applied right across Britain - not just in Wales.

There is growing concern in south Yorkshire, Merseyside and Cornwall that they will not be able to draw down their full objective 1 entitlement, totalling about£2bn over seven years.

In Wales, assembly first secretary Rhodri Morgan was warned on Friday that he was 'on probation' over European aid for Wales.

The Liberal Democrats said Mr Morgan would be judged on his ability to get a guarantee of match funding from the Treasury.

Michael German, leader of the Lib Dems in the assembly, said: 'The response shows that the Objective 1 programme cannot start until the government commits to match funding to the Welsh block grant for its lifetime.'

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