UK Gov’s ‘levelling up’ fund ‘undermining’ the union, Institute for Government warns

The UK Government’s ‘levelling up’ fund risks “undermining” the union, the Institute for Government has warned.

According to the London-based think tank, bypassing the devolved governments to give money to local councils directly could backfire on Boris Johnson’s administration.

The post-Brexit UK Shared Prosperity Fund (UKSPF), replaces EU ‘structural funds’. The move takes away power from the Welsh Government, which decided where the EU cash was spent, and centralises it in London where the decisions will be made by Tory ministers.

From the perspective of the devolved governments the plans represent an “unwelcome encroachment”. The Institute for Government says the move runs counter to the UK Government’s key objective of brining the four nations of the union closer together.

The report published today, The UK Shared Prosperity Fund: Strengthening the union or undermining devolution?, calls on the UK Government to take a different approach.

It says it should into account the devolved governments’ existing role in administering EU structural funds.

It also calls on the UK government to ensure greater consultation with the devolved nations, to introduce clear spending criteria and set up a governance structure that allows the devolved nations to work as partners.

‘The paper says’ 

The paper says the UK government should:

• Improve its approach to consultation with the devolved governments, share more information, and refrain from making announcements without prior notification
• Establish transparent criteria for the allocation of funds based on an assessment of relative need at the local, as well as regional, level
  clarify how it will ensure that spending under the new fund complements rather than duplicates spending programmes managed by the devolved governments
• Set out how it will engage with devolved counterparts at each stage of funding allocation, and how disputes will be resolved
  explain how it will meet its manifesto commitment that devolved nations will receive “at least as much” funding to support economic development as previously
• Ensure that the UKSPF operates over a period of at least five years to allow devolved governments and recipients of funds to plan and budget effectively
• Clarify how the fund will work in Northern Ireland, and especially how funding allocations will take account of the need for cross-community support

Report co-author and IfG senior fellow Akash Paun said: “There is a clear opportunity to put in place something that is more flexible and less bureaucratic than the EU system, and that demonstrates to voters the value of UK-wide action.

“But the government appears to be proceeding with its plans for the UK Shared Prosperity Fund with almost no meaningful engagement with the devolved governments or other stakeholders. Unless they change course, and begin to work in partnership, ministers risk undermining their own objectives.”