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UK Government would scrap fund that replaced EU regional aid -if reelected




The UK’s Conservative Government, campaigning for reelection though well behind in the opinion polls, has announced that it would scrap the ‘Shared Prosperity Fund’ that replaced regional aid from the European Union after Brexit. If Rishi Sunak remained Prime Minister, he would instead use the £1.5 billion a year to partly finance his plan to introduce compulsory National Service for 18-year-olds, writes Political Editor Nick Powell.

There were few aspects of membership of the European Union more loathed by pro-Brexit Conservatives than European Regional Aid. The sight of a circle of gold stars on a blue background, proclaiming EU investment in the UK’s least prosperous areas, infuriated them. And when the referendum on leaving the EU came, the areas that benefited the most from European money often strongly supported Brexit, reassured that it was really ‘our money’ as the UK was a net contributor to the EU budget.

That all unravelled in the next few years. Instead of the money targeting the least well-off areas, local authorities across the UK now compete for the money, with ministers in Westminster deciding the winners. The biggest single beneficiary under the EU’s rules had been the poorer half of Wales, which together with Cornwall was the only part of north-western Europe still lagging so far behind that it qualified for the most generous level of funding. It was worth more than €2 billion to Wales over a seven-year multi-annual financial framework.

Control was wrested from the devolved Welsh Government, which the EU had entrusted to decide how to spend the money within its overall priorities. But after that the Shared Prosperity Fund never seemed to be much of a political priority for the triumphant ‘Brexiteers’, who seized control of the ruling Conservative Party.

And so it has proved. After a shaky start to their reelection campaign, the Conservatives briefed Sunday newspapers that they would reintroduce National Service for 18-year-olds. The details are sketchy but the teenagers would have to choose between 12 months in the Armed Forces, (or in “cyber defence”) or volunteering in “civil resilience” for 25 days over a year.

But given the parlous state of the UK’s economy and public finances after the triple blows of Covid, Brexit and the global impact of Russia’s invasion of Ukraine, the golden rule of this UK election is that no party can admit to making an ‘unfunded’ pledge, all the more so after Liz Truss’s attempt to ignore economic reality during her short-lived premiership.


The Conservatives say National Service will cost £2.5 billion a year -and most of it will be paid for by scrapping the £1.5 billion Shared Prosperity Fund. The other £1 billion will come that last resort of a politician with no idea how to pay for something: “a tax avoidance crackdown”.

The sums don’t even appear to add up unless fewer than one in 20 18-year-olds actually join the military. As for the rest, they will be given the Orwellian description of ‘compulsory volunteers’, though ministers have been quick to say that no-one will face a fine or imprisonment for not complying.

It’s all desperate stuff from a political party that is highly unlikely to win the election. But it does represent a decision by the Conservatives to concentrate on their core vote, concentrated amongst the older members of the British population. Young people are vanishingly unlikely to vote Conservative.

More importantly, it represents a decisive abandonment of the ‘Red Wall’ -the left-behind places in the north of England and north Wales that have traditionally supported the Labour Party but voted for Brexit in 2016 and gave Boris Johnson his majority at Westminster in 2019.

The Labour Party, which is on course to win the election on July 4, has been quick to mock the National Service proposal. But we still await news of what it would do for the less prosperous parts of the UK, both in the ‘Red Wall’ and in areas like the south Wales valleys that stayed loyal to Labour even at its lowest ebb.

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