Chancellor Philip Hammond guarantees EU funding beyond date UK leaves the EU

The NFU and National Trust have welcomed the announcement that thousands of British organisations will see current EU funding extended after the UK ceases to be a member.

Philip Hammond
Philip Hammond

Key projects supporting economic development across the UK could be given the green light, ending uncertainty over their future following the UK's decision to leave the European Union.

Assurances set out by the Treasury include:

  • All structural and investment fund projects, including agri-environment schemes, signed before Autumn Statement will be fully funded, even when these projects continue beyond the UK's departure from the EU.
  • The Treasury will also put in place arrangements for assessing whether to guarantee funding for specific structural and investment fund projects that might be signed after the Autumn Statement, but while we remain a member of the EU. Further details will be provided ahead of Autumn Statement.
  • Where UK organisations bid directly to the European Commission on a competitive basis for EU funding projects while we are still a member of the EU, for example universities participating in Horizon 2020, the Treasury will underwrite the payments of such awards, even when specific projects continue beyond the UK's departure from the EU.

As a result, British businesses and universities will have certainty over future funding and should continue to bid for competitive EU funds while the UK remains a member of the EU.

In a new boost to the UK's agricultural sector Hammond is also expected to guarantee that the current level of agricultural funding under CAP Pillar 1 will be upheld until 2020, as part of the transition to new domestic arrangements.

Hammond said: "The UK will continue to have the all of the rights, obligations and benefits that membership brings, including receiving European funding, up until the point we leave the EU.

"We recognise that many organisations across the UK which are in receipt of EU funding, or expect to start receiving funding, want reassurance about the flow of funding they will receive.

"That's why I am confirming that structural and investment funds projects signed before the Autumn Statement and Horizon research funding granted before we leave the EU will be guaranteed by the Treasury after we leave. The Government will also match the current level of agricultural funding until 2020, providing certainty to our agricultural community, who play a vital role in our country.

"We are determined to ensure that people have stability and certainty in the period leading up to our departure from the EU and that we use the opportunities that departure presents to determine our own priorities."

The NFU said farmers have been given much-needed certainty in the short term after the Treasury’s decision to guarantee agricultural spending though to 2020.

This should mean that farmers can count on receiving the Basic Payment Scheme through to 2020 and that agri-environment schemes already in place are guaranteed through to their conclusion. The NFU is working with Defra to understand the position of those farmers applying for Countryside Stewardship this September.

The NFU said it was glad to hear that other rural development grants such as Leader offered before the Autumn Statement will also be honoured.

NFU President Meurig Raymond said he was extremely pleased to hear the news officially after the NFU’s discussions with Secretary of State Andrea Leadsom, her department and the Treasury in the past three weeks. Raymond said this certainty in the short term now allows time for the industry and Defra to formulate a domestic agricultural policy that is fit for purpose.

Raymond added: "The Treasury’s announcement today is positive for farmers.  I hope that this short-term certainty will help to deliver longer-term confidence and this is exactly what farm businesses need now.

"We’ve been emphasising to the Government at all levels that the success of the UK’s largest manufacturing sector - food and drink–worth £108 billion to the UK economy, is underpinned by the farming sector. With the agricultural budget now retained and agri-environment agreements and BPS payments now honoured, I am delighted that the Prime Minister and Defra have understood the importance of farming and food production."

A National Trust spokesperson said: "We welcome the Government’s decision to continue with funding for newly agreed and existing agri-environment schemes. But set against this is the continued uncertainty should new applications be restricted beyond this autumn. This would put at serious risk decades of effort by farmers and organisations like ours to protect and enhance our countryside.

"Farmers need certainty as we move to a more sustainable model of support for farming which puts the recovery and resilience of the natural environment at its heart. Better funded and more widely available agri-environment schemes would offer a ‘bridge’ between the old and the new, helping farmers prepare for a future of new market opportunities whilst delivering greater public benefits from public money. 

"The National Trust is calling for a system that increases the benefit to the public of a beautiful, natural environment rich in nature and wildlife and that secures the long term health and productivity of the land on which our farming depends. We want to work hand-in-hand with farmers, the UK Government and devolved administrations, and other stakeholders to secure this fundamentally different approach to land; one that offers a good deal for taxpayers whilst achieving a truly sustainable and thriving countryside in the twenty first century."

 In a speech earlier this month, National Trust Director-General, Dame Helen Ghosh, called for a system that helps secure the long term health and productivity of the land, in a statement the NFU criticised.

In August the National Trust and seven other wildlife and farming organisations wrote to the Chief Secretary to the Treasury asking his department to commit to existing and new agri-environment schemes.

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