POST Brexit, people in the north of England are at risk of losing out on £300m for regional economic development, double the average cut per head as the rest of England.

That is according to the Northern Powerhouse Partnership who have published a new report which says the government is planning to spend less on English regional development than was the case under Theresa May or David Cameron (2014-21) despite levelling up being regularly touted by Conservative ministers as a flagship policy.

The Shared Prosperity Fund (SPF) and Levelling Up Fund (LUF) in England will be worth just over £1.4bn a year, compared with an annual £2.1bn spend under the ERDF, ESF and Local Growth Fund.

The government has already guaranteed to match funding for Scotland, Wales, Northern Ireland and Cornwall. 

Read more: Success of levelling up for the North questioned

The analysis from the Northern Powerhouse Partnership (NPP), PACE at Teesside University and the Joseph Rowntree Foundation (JRF) looked at allocation to date of the Community Renewal Fund (the forerunner to the SPF) and LUF in order to forecast future funding, if they were distributed in the same way.

In Tees Valley – one of the most deprived regions in the UK – annual funding would be cut from £46m to £21m per year, a reduction of £37 per person per year.

And now, the NPP and JRF are urging the government to at least ensure that no region will be worse off under new levelling up funding than they had been before we exited the EU. 

They said: "For this to happen the allocation of levelling up funds for regional development must be improved. If it mimics the distribution of money so far then places in need of levelling up will be worse off."

They also stress that centralised competitive bidding for pots of money will undermine the levelling up agenda, and funds should instead be devolved to a subregional level where they could be spent more effectively by metro mayors.

In 2018, northern metro mayors including Tees Valley Mayor Ben Houchen, Andy Burnham, Steve Rotheram and Dan Jarvis urged Whitehall to devolve control over the new funding streams to local leaders.

The Northern Echo: Henri Murison, director of the Northern Powerhouse PartnershipHenri Murison, director of the Northern Powerhouse Partnership

Henri Murison, of the Northern Powerhouse Partnership, said: “This shows in pounds and pence the gap between rhetoric and reality on the levelling up agenda and broken promises on retaining regional investment post Brexit.

“Many of the places that stand to lose out the most under the current funding formula are the ones most in need of serious investment. This requires an urgent strategy rethink to ensure these areas are levelled up, not down. 

“At the very least, Government needs to keep its word on matching EU funding. This must not pit regions against each other through competitive bidding but should instead be devolved to metro mayors, who can invest funds more effectively in areas such as skills.

“This is vital to helping us compete in the industries of the future, as well as being a key step towards unlocking future prosperity and achieving net zero.”

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Katie Schmuecker, Deputy Director for Policy and Partnerships at the Joseph Rowntree Foundation said: “The Government was elected on a pledge to level up, but this new analysis shows this Government plans to spend less on levelling up via regional development than Theresa May or David Cameron’s administrations.

"What is more, if the planned expenditure is distributed in the same way as the Levelling Up and Community Renewal Funds to date, many parts of the north are at risk of significant drops in funding in future. 

“Lack of progress in levelling up the country means geographic inequalities in quality of life persist. Levelling up should be about building better opportunities so people and their families can thrive.

"To truly level up the UK, the Government must use its White Paper to focus support on the areas that most need it.”

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