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EU structural and investment funding, between 2014 and 2020, is worth €4.7bn to Wales, according to new data from CIPFA (Chartered Institute of Public Finance and Accountancy).
This is because Wales, between 2014 and 2020, will receive €3.1bn in EU structural funding, which then levers in an additional €1.6bn in funding from both public and private sources for projects and infrastructure, raising the total funds to €4.7bn.
In a submission to the Welsh Government, CIPFA argues that the current method of distributing funding to Wales from the UK is outdated and inappropriate. This is because the amount of funding Wales receives is determined by the Barnett Formula (linked to population size) and not driven by need.
Although it remains unclear whether EU funding will be replaced by UK government funding beyond 2020, CIPFA urges that the current funding mechanism is not used to provide future funding. Instead, the Institute calls for a new funding formula and agreement between the UK and all the devolved nations that will allocate funding towards need and outcomes.
Don Peebles, Head of Policy and Technical, commented:
“The money that Wales receives from the EU is by no means insignificant. And if funding levels were sustained and devolution arrangements modernised, then there could be real opportunity to more effectively use this funding.
“To achieve this, the government must directly face up to the limitations of the Barnett Formula. And look to create a new funding scheme that would allocate money based on need and to meet specific outcomes.”