Still waiting for the UK Shared Prosperity Fund

Equally Ours’ Belinda Pratten on the prospects for the UK Shared Prosperity Fund.

In April 2021, all EU-funded programmes in the UK will draw to a close, yet we still know practically nothing about its proposed successor, the UK Shared Prosperity Fund (UKSPF). It has been linked to government’s plans to level up the economy, but to make a real difference it will need to invest in people as well as places. Designing a UKSPF that genuinely drives equality will ensure that every person can fulfil their potential.

Levelling up – no-one left behind

The current pandemic makes this more important than ever. Covid-19 has exposed and exacerbated long standing structural and systemic inequality in the UK. Some people and communities have been disproportionately affected by the pandemic, related to their protected characteristics under the Equality Act 2010.

Discrimination and disadvantage have combined to place these groups at higher risk of Covid-19 and its wider social and economic impacts. They must not be left further behind if, as is expected, the economy goes into recession.

The government has rightly said that its priority is to support jobs. But as unemployment rises, individuals and groups already facing discrimination and other barriers in and to the labour market will face an even greater struggle. This includes women, people from Black, Asian and other minority ethnic communities and disabled people, as well as younger and older workers. Some will have multiple and complex needs.

These groups have directly benefited from EU structural funds, particularly the European Social Fund. Of the £9.3 billion allocated to the UK in the 2014-2020 spending round, more than half (£5.55 billion) was linked to equality objectives. As our film shows, this funding has helped to transform lives. It has provided a lifeline to individuals and communities and the voluntary and community organisations that support them.

Making a real difference

Appropriately targeted, the UKSPF also has the potential to make a real difference to those experiencing disadvantage and discrimination. It can do this by:

  • providing at least the same level of investment in education, training and support to disadvantaged and discriminated against individuals and groups as the European Social Fund;
  • funding provision missed by mainstream support, creating a clear route to employment and other support for individuals and groups furthest from the labour market; and
  • hard-wiring equality drivers into the UKSPF from the outset, with mandatory requirements to address equal opportunities and narrow employment gaps.

The UK Shared Prosperity Fund – Improving local economies

An important strength of previous EU funding was that the devolved administrations developed very good relations with civil society organisations to help make this happen. The funding came through them and this should continue with any new funding framework.

Investing in education, training and employment support at the local level has been shown to be a more effective way of creating new jobs in deprived areas than offering businesses tax and other incentives to relocate there. Raising demand for skills will also mean more qualified and better paid jobs for local people, improving local economies, stimulating innovation and increasing productivity.

A good example is Chwarae Teg which runs a career development programme for women in Wales, co-funded by the European Social Fund and the Welsh government. It helps women enter, or improve their position in the workforce, focusing on Science, Technology, Engineering and Mathematics (STEM), construction and other industries where women are under-represented. Its first 5,000 trainees subsequently received average pay increases of £4,000 each, or over £1 million in total. Clearly the loss of this funding would be a loss to the Welsh economy and not just to the women themselves.

Targeting equality

Designing-in equality and human rights levers will enable business to do the right thing. As importantly, it will also bring real economic benefit. According to the Government’s own figures, a 5% rise in the employment rate of working-age disabled people would increase GDP by £23 billion by 2030. And if Black, Asian and other minority ethnic people were to be fully represented in the labour market, the potential benefit to the UK economy would be £24 billion a year, or 1.3% of GDP.

Targeting investment in this way would help to stimulate a ‘race to the top’ for business, as part of a wider strategy to improve productivity and economic competitiveness. It would also assist public authorities in fulfilling their obligations under the Public Sector Equality Duty of the Equality Act 2010. This too could be strengthened by activating Section One, requiring public authorities to actively consider how their strategies can reduce socio-economic inequality.

An economy that works for everyone

Designed right, the UKSPF could have a significant impact on the people and places that need it most. By addressing labour market discrimination and barriers to employment, the UKSPF could help to level up the economy, increase productivity and close employment and pay gaps. With the help of civil society, it can help create an economy that works for everyone to fulfill the prime minister’s commitment to ‘levelling up’ for people and communities who have been left behind.

At Equally Ours we have worked with civil society organisations around the UK to develop shared principles for the UKSPF, ensuring that it is transparent and accountable; accessible to local and speciality community organisations; and respects devolution.

If you agree, you can sign up to our shared principles at the link below.

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