Brexit: Hammond guarantees funding post EU exit

CHANCELLOR Philip Hammond has pledged to safeguard billions of euros of EU funding for universities, scientists, business, farmers and run-down areas following Brexit, with the Treasury to cover the shortfall.

Although the guarantee, which is to cover €5.3 billion a year from the Common Agricultural Policy, plus regional and social funds for poor regions, and around €1.75 billion for business and universities including scientific and medical research, sounds promising, it is only scheduled to last until 2020 after which there could be a serious scrimmage for funding.

Critics have said that the promise falls short and blasted the “continued uncertainty” over the UK’s exit from the EU, while the astronomical amounts involved somewhat dampen leave campaigners’ claims that Brexit will save the UK economy some €405 million per week, with public finances set to be hit further by the underwriting.

Liberal Democrat leader, Tim Farron, said: “It is complete brass neck from the Treasury to try and spin that matching the funding that businesses, scientists and farmers currently receive from Europe is somehow a ‘benefit’.

“What happens after 2020? Where is the extra £350m a week for the NHS that the Leave campaign promised? There must also now be assurances that this money will cover everything that is currently done and not become a way for ministers to pick and choose pet projects in the face of an increasingly turbulent post-referendum economy.”

Shadow Chancellor John McDonnell said: “We welcome Phillip Hammond’s decision to agree with Labour’s calls for EU structural funds to be protected post-Brexit. This will help to give some reassurance to communities and businesses right the way across the UK”.

Mr Hammond said that structural and investment fund projects signed under the EU’s €80 billion euro Horizon 2020 programme before the Autumn Statement later this year would be backed by the Treasury, and encouraged universities and businesses to push on with their applications.

He said: “The UK will continue to have the all of the rights, obligations and benefits that membership brings, including receiving European funding, up until the point we leave the EU. We recognise that many organisations across the UK which are in receipt of EU funding, or expect to start receiving funding, want reassurance about the flow of funding they will receive.

“The Government will match the current level of agricultural funding until 2020, providing certainty to our agricultural community, who play a vital role in our country. We are determined to ensure that people have stability and certainty in the period leading up to our departure from the EU and that we use the opportunities that departure presents to determine our own priorities.”

The National Farmers’ Union (NFU) said the Treasury’s announcement was “positive,” with farmers currently receiving significant subsidies and other payments under the EU’s Common Agricultural Policy (CAP), while other structural and investment funds that will be underwritten include CAP pillar two, the European Social Fund, the European Maritime and Fisheries Fund and the European Regional Development Fund, including European Territorial Cooperation.