Post-Brexit failure to replace European Social Fund would be “disastrous”, says Committee

Any gap in payment between the existing European Social Fund and a new fund would be disastrous.

In a report published today (Wednesday 4 April 2018), the Work and Pensions Committee also says the UK has a rare opportunity to “create a truly world-leading successor” to the European Social Fund “that is the envy of Europe” — but it must act fast.

The consequences of a gap in provision—for providers, for local areas, and for individuals—would be “disastrous”.

The ESF provides £500million a year dedicated employment and skills support funding for people and communities poorly served or neglected by “mainstream” support into, and in, work. 

As good as some of the present provision is, it is delivered in siloes and is not designed to meet individuals’, families’, and communities’ total needs.

The successor fund must act as a transition to a proper Mark II system which allows communities’, families’, and individuals’ total needs to be catered for and not restricted by arbitrary definitions of help.

The Committee calls on Government to:

• Ensure funds are available so there is no gap between existing and new provision
• Establish a new arm’s length body, to dovetail grants to existing funding streams so programmes can meet effectively all of their participants’ needs
• Retain a separate fund within the UKSPF for employment support for disadvantaged groups and communities
• Ensure flexibility of local funding mechanisms for both longer-term and short-term programmes; and
• Cut bureaucracy for providers, in getting money to projects that work or to new projects that show entrepreneurial skills

Rt Hon Frank Field MP, Chair of the Committee, said:

“We now have an historic opportunity to create a truly fit-for-purpose successor to the ESF. The Government must act quickly so that those excellent existing suppliers are not bankrupted. Effective reform here offers the Government an important new chance to begin to fill our skills gap from the community upwards, instead of having a top-down approach.’ 

Sector Response

Association of Employment and Learning Providers (AELP) chief policy officer Simon Ashworth said:

“ESF funding has played a particularly valuable role in giving unemployed people the skills they need to make a sustainable return to the jobs market and the reskilling of workers at the risk of redundancy. 

“The devolving of it has also made a positive impact in specifically meeting local economic needs.  We certainly wouldn’t want this funding to be lost.”

Stephen Evans, Chief Executive, Learning and Work Institute, said:

“Last year more than 200 organisations and individuals joined our campaign for a successor to European Social Fund, which makes a significant investment in helping people improve their skills, get into learning, and find work. 

“We were delighted when the Government committed to a Shared Prosperity Fund, in line with our campaign. However, since then there has been little progress. The Government should swiftly commit to the new fund being at least as big as ESF, reducing bureaucracy, devolving funding wherever possible, targeting investment on the big challenges, and integrating support with other programmes. 

“For example, this investment could make a big contribution to reversing the 25% decline in the number of adults improving their literacy and numeracy in the last five years. It’s time for the Government to set out its vision and work with experts on the ground to make it a reality.”

A spokesperson from ERSA, said:

“ERSA has been working hard with organisations across the sector and beyond to raise the issues flagged by the Committee and we welcome the report recommendations.

“It’s imperative that the government acts on them urgently if we are to avoid a cliff edge in funding and therefore lose vital support to disadvantaged communities.

“The government must ensure that a future initiative retains a focus on employment and skills support and addresses the flaws inherent in the current system, reducing bureaucracy and getting more money to the frontline.

“We have the opportunity to design a successor initiative that builds a more inclusive economy as the UK leaves the EU. The government must now provide clarity and leadership to turn a potentially “disastrous” prospect into a world-leading success.”

What do you think?