Left in the dark, left in the cold: why charities and social enterprises are worried about the replacement for EU funding.

“People helped by these organisations are often vulnerable, destitute and have little faith in a system that has perhaps failed them in the past.”
Photo by Noah Silliman, courtesy of unsplash

The North East of England has benefitted immensely from European Union funding. Within the 2014-2020 funding cycle -the last one before the end of the transition period, the North East Local Enterprise Partnership alone received £437 million. Further information can be accessed here.

As this Local Enterprise Partnership covers only Northumberland, Co Durham and Tyne and Wear, it does not account for the separate allocation to Tees Valley Unlimited – its Teesside counterpart. Having left the EU, we now must design our own support systems to help local people progress into work, education and training, as well as remove the underlying barriers they face- such as addictions, or low literacy and numeracy skills.

The Conservative Party manifesto for the 2019 General Election stated that the UK Shared Prosperity Fund (UKSPF) would replace European Social Fund (ESF) and European Regional Development Fund (ERDF) funding. The manifesto states that the Conservatives will use the “opportunity of Brexit to replace the ineffective and bureaucratic European Social Funds with a tailored, individual-centred skills programme through the UK Shared Prosperity Fund”.  So far, very little has been done to achieve this stated goal. The formal consultation for the new funding scheme was originally to be released in October 2018, and is now overdue –it is more than two years late. That the government allowed such a delay speaks volumes. Those within the charitable and employability sectors often feel that the government is treating them with contempt by not paying attention to the needs of the organisations and the people they support.

People helped by these organisations are often vulnerable, destitute and have little faith in a system that has perhaps failed them in the past.

It is essential that community organisations especially, have a say on how the UKSPF will work in practice. The manifesto mention of support for ‘vulnerable’ and ‘young’ people in several instances is welcome, but it goes on to say that local distribution mechanisms would be preferred and here we find the Conservative government sometimes has a problem with defining what is local. For example, it conflates regional, sub-regional and local areas. Local Enterprise Partnerships (the very name is inaccurate as they have a wide geographical limit, they are not just local) were described as “joint local authority-business bodies brought forward by local authorities to promote local economic development” by the 2010- 2015 coalition government. This suggests lack of understanding of, or attention paid to, true localism. Hence, we are left wondering who will actually distribute this funding and what geographical boundaries will be used?

The mainstream government funded support schemes, such as the ‘Work and Health’ and former ‘Work’ programmes are widely criticised for multiple reasons. They appear to be focusing on low hanging fruit, on clients who need little support in order to progress, while putting minimum effort into supporting those with complex needs or facing multiple issues, and at the same time channelling money into multi-nationals and corporations and Tory donors instead of supporting charities and social enterprises.

The effectiveness of these programmes is often called into question, being described as ‘low’ against the target . With Covid-19 still potent, and also its collateral effects on people’s skills and employability, there is a real danger that the government will choose to ignore calls from community organisations and structure UKSPF in a similar manner to the above-mentioned programmes. Other possible design flaws include lack of focus on equity and equality. The current ESF and ERDF emphasise equality as a cross-cutting theme, with each prospective project applicant having to explain how the fund’s remit will be embedded within project delivery. Another danger to be avoided is the choice of quick wins (often in the South of England, where jobs can be created more quickly) over areas in the North, where long-term investment is needed to make a real difference because of the prevailing structural inequalities. Delays to consultation make it extremely unlikely that UKSPF funding will be distributed from April 2021 and, given that the current EU funding cycle is coming to an end, there is now a real risk that huge gaps in provision of and access to employment support will emerge. There is a risk that infrastructure will be prioritised over skills and employment schemes; a shiny new bridge might prove too much of a temptation and a more attractive option than upskilling twenty ex-offenders or 100 refugees. Finally, it is far from clear how much money will actually be available through the scheme. The Conservative Manifesto does not explain if the £500 million, the amount promised, will be an annual allocation or if it will follow another cycle. Hence, it is impossible to assess whether more or less money than the current EU provision will be available.

The government must listen to the voice of the community and design a fund that:

1. Involves clients in the design, delivery and evaluation of the service.

2. Is appropriately funded.

3. Strengthens equality- including gender, race and disability.

4. Is effective in supporting local and regional identities and takes local circumstances into account.

5. Focuses on social integration and skills, not just infrastructure.

6. Funds small and medium size providers with high social value over profit-making organisations and multinationals (which means that the funding cycle has to take into the account cash flow considerations for such organisations).

7. Provides long-term support; changing disadvantaged people’s lives takes time.

8. Is independently evaluated, with a set allocation earmarked for evaluation activities.

9. Encourages and facilitates innovation at a local, regional and national level.

10. Enables cross and inter-sectoral collaboration.

We hope this will be done as a matter of urgency, for the sake of those clients who need it most.

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