The Local Government Association’s work to lead the debate on the potential impact of Brexit on councils and ensure the voice of the sector is heard during exit negotiations continues at pace.
We have identified a number of key areas that contain the greatest potential risks and opportunities posed by Brexit. As the European Union (Withdrawal) Bill makes its way through Parliament we are working to ensure councils have a role in helping to establish a new legal base for the UK during the process of departure.
It was great to be able to give evidence to the commons communities and local government committee about the key risks and opportunities of Brexit and outline increasing concerns about the lack of clarity over how the government plans to address the potential €10.5bn (£8.4bn) UK-wide funding gap for local communities that could immediately open up from the point we officially exit the EU.
Since my appearance in front of the committee, positive steps have been made. As part of the recent phase one negotiations on exiting the EU, it was agreed that continued participation in the Multiannual Financial Framework (MFF) would include the European Regional Development Fund, the European Social Fund, European Territorial Cooperation, Rural Development Fund and almost all other EU funding programmes such as Horizon 2020.
This agreement means local communities will continue to benefit from EU funds until the end of the current programmes in 2020. This is welcome as a short-term solution.
What is needed now is clarity on the period beyond 2020 and that funding to local areas is fully replaced from 2021 as part of a locally-led successor to EU regional aid. Otherwise, we will create another period of uncertainty in the programme.
The LGA will therefore seek to secure design and delivery principles for the successor arrangements, which give local areas far greater say over how money is spent, and enables them to deliver the ambitions of the industrial strategy. Our main principles are that the UK Shared Prosperity Fund should:
- Be at least equal in value to the current full sum of EU structural funding for the 2014-2020 period
- Maximise integration with other funding streams for local growth
- Be easier to access and manage, with a simplified and more proportionate approach to financial management
- Provide an opportunity for different and better arrangements that are more flexible and responsive to local needs in all types of areas.
We need to avoid the uncertainties and delays that have already plagued this programme from happening again. This has already had an impact across the country.
For example, delays associated with uncertainty have caused a reduction in project effectiveness as proposers walk away or the planned match is no longer available thus undermining the capacity for local areas to have a co-ordinated strategy.
An illustration of this is Sheffield City Region, which published a project call under the European Structural Fund, which closed in June 2017. Project proposers have only just received response on the initial appraisal as a result of this uncertainty. The concern is it will be a full year since the original close of the project before any funding agreement is signed.
Positive, tangible progress has been made on the issue, but there is work still to be done before we can call it a success.
Our focus is also on securing a formal role for councils in UK law making. Through the Committee of the Regions, UK local government currently has a formal advisory role in the EU law and policy-making process. Replicating this advisory role post-Brexit, without additional bureaucracy, is fundamentally important and will lead to better, more effective legislation.
We will be renewing our call for evidence from councils about the impact of Brexit on local government so that the risks and opportunities presented by places across the country can be accurately recorded.
Kevin Bentley (Con), chair, LGA Brexit task group