Executive Admits Treasury Won't Meet Highlands And Islands EU Funding Gap

20 December 2005
The loss to Scotland's structural funding from the new EU budget agreed by Tony Blair last weekend may not be met by the Treasury.

The Scottish Executive today admitted in evidence to the European and External Relations committee that the new funding package for the Highlands and Islands 2007-13 will be 40-45% less than the current package and that a Treasury guarantee that any lost funding would be replaced by domestic funds does not apply to the deal negotiated in Brussels.

Speaking from Brussels where he was watching the Committee SNP Europe spokesman Alyn Smith MEP said

"I was shocked by this admission from the Scottish Executive that the money Gordon Brown promised was only available if the original UK proposal, including the repatriation of structural funding, went through. The ink is barely dry on the deal and the backsliding has already started.

"The UK knew from the start that the rest of Europe would never agree to the drastic budget cuts proposed by the UK or to the ending of structural funds for the EU 15.

"It was a ridiculous proposal, but for months people across Highlands and Islands have been given the impression that if the Structural Funds were cut, or disappeared all together Gordon Brown would reimburse the money. Today we have the Minister telling us that not only will we not be reimbursed but we risk losing more through the loss of the rebate.

"To hear Mr Wilson admit that he wanted to see Scotland's funding from Europe end so that the central government could take complete control of Scotland's share of the cash is even poorer. The whole point to EU funding is that the EU-Local Government partnership has delivered more interesting, innovative projects than central government.

"Scotland will get 40-45% of current EU funding across the board, according to Allan Wilson, the Highlands and Islands will get only 60% of the current transitional funds. Projects rely on this money and now we learn it will not be replaced. The government has given all the other countries in Europe bonuses to make them sign a budget deal, all we have had are false promises."