LEP welcomes EU funding challenge

11th February 2014

On Friday 7 February, a high court judge ruled that a Government decision on how to allocate EU funding in Liverpool and Sheffield City Regions had been unlawfully made.

The LEP welcomed the news, which means that Government will have to reconsider its decision, taking into account proper equalities information. The Government's unlawful decision would cut EU funding in the City Region for economic regeneration, which would mean significantly less money for transformative projects than in previous years. James Newman, Chairman of the Local Enterprise Partnership, said: -The LEP welcomes the High Court decision to quash the Government's unlawful decision over EU funding. -However, we are very disappointed that the judge has not ordered the Government to adjust its allocation of funding, and will continue to support any appeal this decision. The LEP remains steadfast in its belief that the UK Government's decision to cut our EU allocation by over a half is grossly disproportionate compared to other similar parts of the country and is economically unjustifiable. -I hope the Government will look at the Judge's comments and seek to talk to the LEP about how the City Region might be compensated in other ways. The huge cuts, which the Government has planned for our EU Funding allocation, will be hugely negative news for jobs and business growth in the Sheffield City Region, when it is clear from all the economic statistics that we need their support. -Over the last decade, European Union funding has helped to deliver key projects in the Sheffield City Region, including Sheffield's city centre regeneration and train station developments, Barnsley's Transport Interchange, Doncaster's Civic and Cultural Quarter and Rotherham's Advanced Manufacturing Park. These projects have had a huge impact on jobs and growth in the Sheffield City Region, and this cut in funding would mean missing out on the economic growth that future projects like these would give us. Councillor Roger Stone, Leader of Rotherham Borough Council, said: "We are obviously pleased that the decision has been quashed and that the Government will now have to reconsider the drastic effects of his decision to cut funding by 61 per cent to the economically-deprived areas of South Yorkshire and Merseyside. "However, we are disappointed that the Judge did not agree with us that the methodology used in making the allocation decisions, was so unfair that it was in itself unlawful. "We do not take legal action lightly. But this is a hugely serious matter and we are sure that our people would want us to fight to try and get as much regeneration funding as possible, particularly as the European Union itself said there was a discrepancy. "There was a lot of money at stake - over E50 million for South Yorkshire and over E100 million for Merseyside," he said. "That sort of money could have made a significant difference to the lives of ordinary people, literally the difference between having the chance of a job or not. "The consequence of this is that the European programme which runs from 2014 to 2020, would see the South Yorkshire and Merseyside areas take a 60 per cent reduction on previous funding packages. The two areas argued that this was irrational and unfair that other areas had not been treated in the same way, and that South Yorkshire and Merseyside were taking a disproportionate impact. "Both areas appear to have been victimised by this Government and we have a duty to stand-up for our people to ensure they do not lose the businesses and jobs that we very much need. We will obviously consider the whole judgement - particularly about the methodology - and take further advice." The Judicial Review had requested the High Court to order the Government to adjust its allocation of funding from Europe because of a "flawed" calculation method used to distribute a total of Euro 10 billion from the European Regional Development and European Social Funds. The ruling will not result in the authorities automatically receiving more funding but it does mean the Government will have to reconsider its decision, taking into account proper equalities information. Judicial review proceedings on behalf of the Sheffield City Region and Liverpool City Council were issued on September 26, requesting the High Court order the Government to reconsider its allocation because the calculation method it has used is flawed. The formal case was submitted to the High Court on October 15.

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