Brexit: What now for the North?
The North receives more EU funding towards its voluntary sector than the UK average. What will Brexit mean for charities and other social inclusion organisations? We spoke to some of those who work with society's most disadvantaged people about a now uncertain future.
The EU referendum has much to answer for. The UK’s vote to Leave on 23 June has already had seismic effects across the country, not least on its social landscape. As the political leaders responsible for the referendum have reacted to the decision by shirking responsibility, leaving the country waiting around bereft of leadership (see: Johnson, Gove and Farage), there has been a sharp rise in community tension. Meanwhile, local and regional organisations have been quietly dealing with the consequences of the decision.
One result of the UK’s vote to Leave causing concern among charities is the potential loss of access to funds such as the European Social Fund and the European Regional Development Fund.
The European Social Fund is the EU’s main financial instrument of helping EU citizens fulfil their potential. It improves employment opportunities and promotes social inclusion by investing in local organisations best placed to address regional needs. The Regional Development Fund is more business-focused, supporting research and innovation as well as would-be entrepreneurs to run their own small social enterprises.
Between 2014 and 2020 (funding rounds run for seven-year periods), the North of England is set to receive on average 15% per capita more from these funds than the UK average, with money particularly earmarked for the Northeast, East and South Yorkshire, Lancashire and Merseyside. In other words, it is of particular concern to our regions whether they will still receive the funds, and what will happen if funding is pulled.
Into the unknown
Based in Liverpool, the organisation Network for Europe helps the voluntary sector in the Northwest gain access to the ERF and ERDF by providing training and aiding charities’ interactions with central government and Local Enterprise Partnerships, through which the funds are disseminated.
They are sceptical that, once the UK leaves the EU, the government would continue to provide the necessary funds to support the sector regionally.
“The European funding we’re talking about is specifically for smart, sustainable and inclusive growth” – three things central to the voluntary sector (particularly sustainability and inclusivity), observes Network for Europe’s CEO Andy Churchill.
“It’s about money from Europe creating a more level playing field and being targeted at the more disadvantaged,” he says. “That’s more of a priority for our colleagues in Europe than it is in England, so [if we were to leave the EU] we won’t get as much money to support disadvantaged people and disadvantaged groups.
“[The funding] ought to be coming very much to the North, particularly the Northwest,” he continues. “If Europe wasn’t insisting, I would have thought our government would send it where it thinks it would be more useful, which is typically the south of the country.”
Churchill believes that, due to the length of time Brexit will take to negotiate – until late 2018 at the very earliest – it is unlikely funding will be cut off immediately. He estimates that the UK will receive around 70% of the money from the current seven-year cycle – and bizarrely, with the pound now trading less favourably with the euro, the amount we will receive is actually set to increase.
But while Churchill is “relentlessly optimistic,” the uncertainty caused by the result appears to have had a paralysing effect.
“Now we’ve got the vote from the referendum, there doesn’t appear to be a plan,” he says. “The people that were responsible seem to have left, disappeared or gone into hiding… The bizarre bit is that we’re doing a lot of planning around the next few years and we’re standing on funding which may or may not exist.”
Insecure futures
This instability is also pervasive at a more local level. Mike Wild is CEO of Manchester’s voluntary sector support organisation Macc, which assists the city’s 3000+ organisations such as the African Caribbean Care Group in Hulme, which was forced to close temporarily in June after a racist phone call. Wild praises EU funding for paying for things that the government would not usually fund, such as support for BME people excluded from the job market.
As EU funding needs to be ‘match-funded’ by local authorities, organisations potentially risk losing both sources of funding due to Brexit. When local charities are already squeezed by tight resources and increased demand due to the Conservative government’s brutal austerity measures, this is by no means ideal.
“At a time when actually there are more and more calls on us as a sector, our sector’s running on fumes,” Wild says. “We’ve seen a lot of organisations have no reserves. We’ve spent all their rainy-day money in the last few years because we’ve been cut and cut and cut.
“Obviously one of the knock-on effects… is not only will the projects not happen [but] we will employ fewer people, we will have fewer volunteers coming into work alongside those employees. It’s not just that you lose the input to the community; it’s that you lose the economic activity that the sector carries out as well.”
A positive outlook
Although RECLAIM, a Manchester charity that works to build leadership among working class young people, is not a recipient of European funding, its service users have already reacted to the referendum result by creating #TeamFuture, a movement looking to amplify their voices, which were marginalised during the debate.
“Following the result, our young people came to RECLAIM disheartened by the fallout of cultural divides and racism that emerged almost instantly, but they have been determined to make positive change in society as a consequence,” says Roxy Legane, Powerhouse Programme Lead at RECLAIM. “The result has only given them more resolve to shape their own futures.
“‘Disengaged’ communities are often desperate to be heard: RECLAIM bridges the gap between those in power and those on the periphery,” she continues. “As the Brexit plan is developed, the voices of all must be taken seriously, and RECLAIM will be working hard to ensure the brilliant ideas of the young people we work with are at the centre (of the conversation).”
The resolve shown by RECLAIM’s young people suggests at least one positive from all this: that local communities are being proactive. Despite all the projected doom, both Churchill and Wild believe that Brexit may offer a small source for optimism, as Manchester’s ongoing devolution deal and government paralysis may lead to local charities taking more initiative over their futures. Network for Europe have already arranged an information event to get charities organised.
“With a bit of luck we’re going to get a bit of leadership from third sector organisations, local authorities and others saying we need to sort this out locally,” Churchill concludes. “I’m not totally negative about this. I think it might actually force a whole set of people in the Northwest to start being a bit more strategic.”
While the exact impact that the EU referendum result will have is still unknown, it is inevitable that the lives of many in the North will be adversely affected. Whatever becomes of Brexit, it is reassuring at least to know that local people are willing to pick up the pieces. The question is: what resources will they have to be able to do it?
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