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Local and regional government in the UK welcomes the announcement by the European Commission of how regional fundin...
Local and regional government in the UK welcomes the announcement by the European Commission of how regional funding in the European Union should work from 2007.*

EU plans will see future regional funding split into three parts. The first, and largest, will support regions lagging behind economically. Representing 78% of available resources, this will aid areas where wealth is under 75% of the EU average.

Cornwall looks likely to be the only part of the UK to continue to qualify for these, the EU's most generous regional grants, though no actual decision will be taken until next year, on the basis of 2001-03 statistics. A further 20 areas that have previously received the most generous support, which include Merseyside, South Yorkshire and West Wales and the Valleys in the UK, will see a phasing out of current levels of aid. This is not unexpected and, even by 2013, funding will remain at around 60% of the funding currently available, higher than some had feared.

A second strand of the new regional funding will use 18% of total funding to promote regional competitiveness and employment in the rest of the EU, while a third will support activities across national borders.

Through the Local Government Association, UK local authorities will now be looking to influence the Government's official response to the Commission's plans.

'We have consistently fed into the Commission's call for ideas on how regional funding should operate and will now work hard to persuade the Government to reflect our views in its official response. 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 proposals get it about right,' said David Sparks, Chair of the Local Government Association's Economic Regeneration Executive.

'We have waited a long time for these proposals and, now that they have been published, we can see UK local government potentially has a lot to gain. We applaud the focus on competitiveness and the clear intention to target action on overcoming regional economic differences,' said Eileen Armstrong, the LGIB's Head of Policy and Public Affairs.

European regional policy commissioner Michel Barnier outlined plans for the future of the EU's regional funding at a press conference last Wednesday. His plans will now have to be debated by national ministers and MEPs.

* See LGCnet.

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