Agenda item

Report of the Corporate Director of Regeneration and Local Services - Presented by Funding and Programmes Manager, Regeneration and Local Services.

The Chairman introduced the Funding and Programmes Manager, Claire Williams who was in attendance to provide the Committee with an update report in relation to European Union (EU) Funding (for copy see file of minutes).

The Funding and Programmes Manager reminded Members she had attended Committee last year and that the update was in terms of the position one year on.  Councillors were reminded that County Durham was a “Transition Region” and therefore had a ring-fenced allocation of EU funding of £154 million over the period 2014-2020.  It was added that this was split between just over £86 million European Regional Development Fund (ERDF) and approximately £54 million European Social Fund (ESF) and the allocation had recently been increased to this amount, following an uprating of the sterling value in August 2018.

Committee were reminded following the result of the referendum on membership of the EU, Government had stated it would guarantee funding up to the point of “Brexit”.  The Funding and Programmes Manager added this position had been strengthened recently, with funding guaranteed up to the end of 2020, even in the event of a “no deal” Brexit.  Members noted the Open Calls, with up to five new applications from the County Council in the areas of: promoting research and innovation; enhancing the competitiveness of small and medium sized enterprises (SMEs) and supporting the shift to a low carbon economy.

It was added that further Open Calls may be launched in March 2019 if there was still ERDF resources available.  The Funding and Programmes Manager referred to DCC projects as set out within the report, with those approved and full applications currently being appraised.  She added a list of all ERDF and ESF projects that had been approved and were being delivered in the County was appended to the report.  Members were reminded of the LEADER Programme and European Agricultural Fund for Rural Development (EAFRD) and associated projects in the County.

The Funding and Programmes Manager reminded the Committee that the Conservative Party’s manifesto in 2017 set out a replacement for the money that local areas in the UK currently received through European Structural Funds.  It was noted that the UK Shared Prosperity Fund (UKSPF) would be to “tackle inequalities between communities by raising productivity”.  Members noted that it was intended that the fund would be simpler to access than current EU funds, and Local Industrial Strategies (LIS) would be the mechanism in terms of identifying and prioritising funding needs.  It was noted that the LIS would be developed by Local Enterprise Partnerships (LEPs), with a review of LEPs to be part of the process of strengthening their role in delivering economic growth.

The Committee noted the work undertaken by the Council in terms of preparing for the UKSPF, with a draft position having been drafted by the County Durham Economic Partnership’s (CDEP) working group looking at the issue, setting out a number of “wants” for County Durham, including that County Durham does not receive less funding than it does currently, retaining a similar status to being a “transition region”.  Members noted a NELEP working group looking at future funding, identifying the level and types of funding that has come into the North East over the last 20 years, detail of the activities that have been supported and the benefits realised from it, with a view to this informing the expectations for future funding.  The Funding and Programmes Manager noted an All Party Parliamentary Group (APPG) had been established to look at post-Brexit funding and information relating to this was also appended to the report.

The Chairman thanked Funding and Programmes Manager and asked Members for their comments and questions.

Mrs R Morris noted the work that had been undertaken in terms of EU funding and the work to ensure that resources stayed within County Durham.  She asked if we understood the new context post-Brexit, examples given being direct flights to India being available from Manchester or what new horizons and industries would we want to attract to the County and what skills would be required for these and how would strategies be put in place to deliver them.  The Funding and Programmes Manager noted that the Strategy Economic Plan would be refreshed and there would be the LIS, in the context of the NELEP and other partners.

Councillor R Crute noted it was almost impossible to predict where we could be, though he added that if the UKSPF was needs based rather than opportunity based this would be very good.  He added that the LIS would be the template going forward, and it would be important for Overview and Scrutiny to know where this would fall in terms of Combined Authorities.  He also asked as regards the table at section five of the report in terms of ERDF totals. 

The Funding and Programmes Manager noted that there were issues in terms of exchange rate changes and would check figures and circulate further information to the Committee.  The Chairman noted the Industrial Strategy would be an item tabled for the March meeting of the Committee.

Councillor J Atkinson noted no low carbon projects in the pipeline.  The Funding and Programmes Manager noted that low carbon projects proved difficult in terms of demonstrating outputs that would allow for funding to be allocated and also in terms of obtaining match funding from partners.  .  Councillor J Atkinson asked as regards timescales.  The Funding and Programmes Manager noted that funds had to be committed by 2020 and reiterated the many groups and forums by which the Council and partners were working to feed into the shaping of the UKSPF.

Councillor S Dunn noted his concern in terms of any LIS reflecting the needs of County Durham, as the County was very different in comparison with Tyneside and Teesside, and agreed with the point made by Councillor R Crute in terms of the UKSPF being needs based rather than opportunity based.  He added that he had additional concerns in terms of a national agenda that appears to be more subjective than based on need, resulting in Durham missing out on funding.

Councillor E Scott noted that the fractured regional political position did not help and that perhaps there was a lack of ambition in only saying “to maintain levels as per current EU funding” rather than pitching ourselves as national players.  Councillor R Crute agreed with the point adding that “fair funding formula” was a misnomer and that the Government should be pushed for more funding for County Durham, though the strong work of the Industrial Alliance and the APPG, will look to rebalance our regional economy, cross-referencing to the LIS in March 2019.

Councillor E Adam noted in reference to the point made by Councillor J Atkinson that the Environment and Sustainable Communities Overview and Committee (ESC OSC) had looked at low carbon projects, with the Council’s Sustainability and Climate Change Team Leader, Maggie Bosanquet to attend the ESC OSC on 5 April 2019 to provide a progress update, and with a special meeting of that Committee to be held on 30 April 2019 looking at the Carbon Management Plan.

Resolved:

(i)    That the report be noted.

(ii)   That the Economy and Enterprise Overview and Scrutiny Committee receives further progress reports as the programme continues.