Post-Brexit failure to replace European Social Fund 'would be disastrous'

By agency reporter
April 5, 2018

In a short report the Work and Pensions Committee says any gap in payments between the existing European Social Fund (ESF) and a new replacement fund after Brexit would be disastrous. It also says the UK has a rare opportunity to "create a truly world-leading successor" to the European Social Fund "that is the envy of Europe” – but it must act fast.

The European Social Fund is a vital resource. It provides £500 million worth of employment and skills support funding every year for some of the UK’s most disadvantaged people and communities. When the UK leaves the EU, it will have to decide how to sustain this support. The Government has pledged to create a UK Shared Prosperity Fund (UKSPF) serving a similar purpose to current EU funding. Beyond that the future is uncertain.

The ESF has great strengths. It offers dedicated funding for people and communities poorly served or neglected by mainstream employability services – distinct from funding for other growth-boosting investments such as infrastructure. It also allows local areas to fund both long-term strategies and “fire-fighting” local crises such as the collapse of a major employer. Government should commit to maintaining both of these features within the UKSPF.

As good as some of the present provision is, the Committee says, it is delivered in siloes and is not designed to meet the total needs of individuals, families, and communities. The successor fund must act as a transition to a proper Mark II system which allows these needs to be catered for and not restricted by arbitrary definitions of help.

The Committee calls on Government to:

  • Ensure funds are available so there is no gap between existing and new provision
  • Establish a new arm's length body, to dovetail grants to existing funding streams so programmes can meet effectively all the needs of their participants
  • Retain a separate fund within the UKSPF for employment support for disadvantaged groups and communities
  • Ensure flexibility of local funding mechanisms for both longer-term and short-term programmes
  • Cut bureaucracy for providers, in getting money to projects that work or to new projects that show entrepreneurial skills

Frank Field MP, Chair of the Committee, said, "We now have an historic opportunity to create a truly fit-for-purpose successor to the ESF.

"The Government must act quickly so that those excellent existing suppliers are not bankrupted. Effective reform here offers the Government an important new chance to begin to fill our skills gap from the community upwards, instead of having a top-down approach."

* Read the Committee's report on the European Social Fund here

* Work and Pensions Committee https://www.parliament.uk/business/committees/committees-a-z/commons-select/work-and-pensions-committee/

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