UK Shared Prosperity Fund

UK Shared Prosperity Fund
Name	UK Shared Prosperity Fund
Established	2021
Jurisdiction	United Kingdom
Responsible ministry	Department for Levelling Up, Housing and Communities
Related legislation	Levelling Up White Paper

Contents

UK Shared Prosperity Fund

The UK Shared Prosperity Fund was launched in 2021 as a national investment initiative intended to replace aspects of European Union cohesion funding such as the European Regional Development Fund and the European Social Fund. It aims to support local economic development across England, Scotland, Wales, and Northern Ireland through centrally allocated grants to local authorities, combined authorities, and delivery partners including local enterprise partnerships and community organisations. The design intersects with policy agendas in the Department for Levelling Up, Housing and Communities, the Treasury (HM Treasury), and devolved administrations such as the Scottish Government and Welsh Government.

Background and purpose

Conceived in the aftermath of the 2016 United Kingdom European Union membership referendum and the completion of the Brexit process, the initiative formed part of the Conservative manifesto commitments in the 2019 United Kingdom general election to "level up" disparities highlighted by commentators referencing the Industrial Revolution's legacy and the post-war development of regional policy like the Town Development Act 1952. It was framed alongside policy documents such as the Levelling Up White Paper and debates in the House of Commons and House of Lords, with ministers citing prior funding streams from the European Investment Bank and negotiations with the European Commission as context. The fund's stated purpose includes support for skills, employment, communities, and local infrastructure in places affected by industrial decline, deindustrialisation debates exemplified by literature on the North–South divide in the United Kingdom and analyses from institutions like the Institute for Fiscal Studies and the National Audit Office.

Oversight arrangements involve ministerial direction from the Department for Levelling Up, Housing and Communities in England, coordination with the Northern Ireland Executive, the Scottish Parliament, and the Senedd Cymru, and financial scrutiny by the National Audit Office and the Public Accounts Committee. Delivery models draw on administrative experiences from Local enterprise partnerships and combined authorities such as the Greater Manchester Combined Authority and the West Midlands Combined Authority. Implementation has relied on frameworks of grant-making used by bodies like the Big Lottery Fund and governance norms established by the Cabinet Office. Local accountability mechanisms include elected county and district councils such as Kent County Council and Manchester City Council, and partnerships with civic institutions including the Federation of Small Businesses and the Confederation of British Industry.

Allocations were determined through formulas influenced by socio-economic indicators deployed by the Office for National Statistics and fiscal models used by HM Treasury. Funding envelopes are disbursed to lead local authorities, combined authorities, and national administrations, with eligibility reflecting criteria similar to former European Structural and Investment Funds priorities. Programmes may target areas identified in indices such as the Index of Multiple Deprivation and metrics produced by the Centre for Cities and the Joseph Rowntree Foundation. Eligible beneficiaries include small and medium enterprises represented by organisations like the Federation of Small Businesses, educational institutions such as Further Education colleges in England, charities registered with the Charity Commission for England and Wales, and community interest companies modelled after examples like the Torus housing group.

Interventions supported by the fund span skills training programmes linked to providers including City of Glasgow College and Leeds College of Building, business support delivered through structures akin to the British Business Bank, community regeneration projects comparable to Peabody Trust initiatives, and capital works such as town centre improvements echoing schemes in Newcastle upon Tyne and Swansea. Specific strands have included workforce development, enterprise grants for start-ups, cultural heritage projects reminiscent of funding for National Lottery arts programmes, and green transition projects aligned with commitments from the Climate Change Act 2008 and targets promoted by the Committee on Climate Change. Delivery partners have ranged from local chambers of commerce like the London Chamber of Commerce and Industry to voluntary sector consortia exemplified by National Council for Voluntary Organisations.

Responses have been mixed across political actors including Conservative Party (UK), Labour Party (UK), and regional parties such as the Scottish National Party and Plaid Cymru. Analyses by think tanks like the Institute for Public Policy Research and the Adam Smith Institute have assessed the fund's scale, with commentary in outlets such as the Financial Times and the Guardian comparing it to previous EU funding levels. Early impact evaluations conducted by academic centres at institutions like the London School of Economics and the University of Glasgow have explored outcomes on employment, local procurement, and civic capacity, while monitoring by the National Audit Office has focused on value-for-money and delivery timelines.

Critics have pointed to allocation formulas and the relative size of the fund versus legacy European Union programmes, prompting scrutiny from the Public Accounts Committee and commentary in the Institute for Fiscal Studies. Devolved administrations raised disputes over funding blocks and delivery autonomy in exchanges involving the Secretary of State for Levelling Up and counterparts such as the First Minister of Scotland and the First Minister of Wales. Other controversies involved procurement practices scrutinised under rules related to the Public Contracts Regulations 2015 and concerns from organisations like the Chartered Institute of Public Finance and Accountancy about administrative burden. Allegations of partisan targeting or "politicisation" of investment priorities were debated in the House of Commons Select Committees and reported in national media such as the Daily Telegraph and BBC News.

Category:United Kingdom public policy