Brexit to cost Wales over £2.3 billion in lost EU investment, analysis shows

Analysis has shown that Wales could lose hundreds of millions of pounds of funding to London and the South East of England after Brexit.

Wales will lose 2.3 billion as a result of Brexit, a loss per head of the population of £743.11, between 2021 and 2027, the analysis shows.

Communities in Charge, a coalition of community leaders and charities, said that their research reveals significant regional differences between the way in which the EU and the UK allocate funding for economic development.

The figure will come to pass if Westminster, as they fear, does not target replacement EU funding at reducing the inequality in funding between the richest and poorest parts of the UK.

If the new Shared Prosperity Fund is distributed in the same way the government allocates current spending on economic affairs, it will unfairly benefit more prosperous areas, they say.

“It will be like handing every Londoner a cheque for over £200 and taking £700 from every Welsh person,” says Tony Armstrong, chief executive of Locality, one of the organisations running the campaign, which is supported by Power to Change, a Lottery-funded organisation for community businesses.

The government has pledged to set up a UK Shared Prosperity Fund, but it has yet to publish details of how much money will be allocated and how it will be distributed.

A final decision on the design is expected after the Spending Review, which has been delayed beyond autumn because of the Conservative leadership election.

The Welsh Government has called on Westminster to allow Wales to decide how any money that replaces EU funding in spent.

“Any proposals which seek to bypass the devolution settlement or take back decisions and funding which has been under Wales’ control for nearly 20 years are completely unacceptable,” a Welsh government spokesperson said.

“The UK government first floated this idea two years ago but has failed to provide any details about how the £370 million of EU structural and investment Wales currently receives every year will be replaced.”