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STEALTH CUTS IN OBJECTIVE 1 FUNDING FOR WALES - TORIES

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'Conservatives took positive advantage of European structural funds for the benefit of Wales,' said Conservative Eu...
'Conservatives took positive advantage of European structural funds for the benefit of Wales,' said Conservative European candidate Chris Butler.

'Over the last five years, Wales has benefited from£560m of European structural funding, mobilising a total investment of over£1bn. Even Neil Kinnock acknowledged in 1998 that the radical changes to the Welsh economy had delivered `impressive results'.'

'Conservatives do not believe that the value of our membership of the Union should be measured in terms of the subsidies we receive to offset our overall burden as fifth largest contributor to the EU Budget. But, we do believe that we ought to maximise the benefits of our membership.

'After the year 2000, West Wales and the Valleys should benefit from the new Objective 1 funding system. The future of many worthwhile projects in Wales such as the£70m museum and waterfront development in Swansea rests on Labour getting this right,' said Mr Butler.

'But, Labour is making a hash of it. There have been great fanfares coming from Labour about the wonderful extra benefits that Objective 1 funding will bring for Wales. Figures of£2bn available for Wales bandied around in the media have been dropped stealthily to£1.3bn. Was it all hot air? What are the facts?

'We know from a letter sent last August by the treasury minister, Patricia Hewitt, that the government intended to press for a reduction in overall Structural Fund expenditure. So, at one and the same time Labour were puffing themselves up at the prospect of getting Objective 1 funds for Wales, while actively trying to cut them at government level.

'Did they succeed in cutting the Structural Funds? They did. The originally proposed funding level was 275bn. euros for the period 2000-2006. The funding level now is 195bn. euros. Some 40bn. euros have now been ring fenced for structural operations for the countries due to join the EU, but whichever way you look at it this is a massive cut in the original plan, and it will be to the detriment of Wales.

'The overall effect of the change according to the European Council is to maintain the present average aid intensity levels in other words, Labour has negotiated away the very benefits and improvements in funding they were boasting about. They may just about manage to keep up with the Conservative record. The Conservative European team will seek to maximise the benefits for Wales this from Labour's diminished pot.

'Objective 1 funding must be matched at least for by money from the national budget but the government has so far insisted that the Welsh block grant will not be increased to make the matched funding available. So, unless any rabbit is pulled out of a hat conveniently in time for the Euro Elections, any matched funding will have to be found within Wales. In turn, that means that the matched funding will have to come from cuts of expenditure in the East of Wales and cuts in programmes such as education and health. That would make a nonsense of the whole thing.

'Our Labour masters will need careful oversight to make sure that they do not neglect their promises by stealth. We need high quality projects to succeed, not just the prospect of jam tomorrow. The Conservative team asks the government to make the matched funding available to Wales from outside the existing Welsh block,' said Mr Butler.

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