Convergence Freeze: Updates 15th July

Today's round-up of news on the Convergence freeze:

Convergence Office

The Convergence Office in Cornwall has updated its statement from yesterday - read its current statement here. Some salient quotes:

"On Friday 9th July central Government extended its instruction to halt new investments by the South West RDA to include both ERDF Convergence and Competitiveness. This includes ERDF investments matched entirely by the private sector. At present it is unclear as to the length of the embargo." (my emphasis)

"The partnership led by Cornwall Council, the South West RDA and Government Office for the South West will be seeking urgent clarification from Government. Our understanding is that neither the UK Representation nor DG Regional Policy were aware of this step by Government and await with interest the rationale."

So essentially there has been no clarification yet from the Treasury or BIS on how long the freeze is in place or the reasoning behind it. In fact no one seems to have heard from Central Government at all on this issue.


Media Coverage

The Western Morning News again devotes a front-page story to the Treasury/BIS moratorium on EU funding allocations. I'll link to it when it's online but it includes the views of several local politicians and business leaders, see quotes below.

Business Cornwall reports that three Cornish Lib Dem MPs, Dan Rogerson, Stephen Gilbert and Andrew George, have appealed to Vince Cable to intervene to stop the funding freeze. Read the full article.

Social Media

Kernowpods has a great podcast featuring an interview with George Le Hunte, leader of the Camborne Chamber of Commerce. Le Hunte fears that uncertainty over the scale and duration of the freeze will negatively affect economic activity in Camborne, and says that David Cameron should have informed local MPs and businesses about the freeze when he was visiting Cornwall last week. He singles out the £100m next-generation broadband rollout as particularly important project that may be at risk. Listen to the podcast (4 minutes)

Facebook Group: The Save Convergence Funding for Cornwall Facebook group now has more than 300 members. Join it here.

Twitter: Don't forget to follow @SaveConvergence on Twitter for all the latest updates - and use the #saveconvergence hashtag when tweeting about this issue.

Cornwall's Response - Politicians

The following politicians were quoted in the Western Morning News today:

Jude Robinson, Labour Party chair in Cornwall: "Jobs, industry and our economic future are at risk from these mean and almost criminally wrong-headed, savage cuts." (Read Jude's blog post on the freeze)

Julie Girling, Conservative MEP for the South-West: "It is not unusual for money to go unspent. It is unusual in the UK for that to happen. But these are exceptional circumstances."

Councillor Dick Cole, leader of Mebyon Kernow: "It is a disgrace that central government appears unwilling to match-fund EU structural funding which we only receive because of our poor economic performance and our poverty. This lack of investment could cost hundreds of jobs in Cornwall and see many businesses fail."

And these two MPs quoted in Business Cornwall:

Andrew George MP (Lib Dem, St Ives): "This affects the £100 million New Generation Broadband project which is acknowledged to be vital and transformational for Cornwall's future. The project would be funded by European and UK public sector match contributions and should not be stopped pending the Comprehensive Spending Review which is planned to be published on 20th October. Delays to this and other projects could prove fatal."

Dan Rogerson MP (Lib Dem, North Cornwall): "This brake on spending seems to have originated with officials in Government departments who do not understand what is at stake. Vital schemes which are so crucial to the economic development of Cornwall cannot be held up in this way. Of course the Government needs to review its own spending, but it must not delay European and private investment in our region."

Meanwhile Alec Robertson, Leader of Cornwall Council, has this message:

"It’s important not to over-react in this situation despite unhelpful remarks from some commentators. At worst, this is a postponement of decisions on funding, not a cancellation of projects in Cornwall. This action, which mirrors the previous announcement on funding for major transport projects, is a sensible measure to be taken ahead of the Comprehensive Spending Review in the autumn.

"The fact that our match funding draws in a great deal of European money will be one of the key criteria considered by the government when allocating funds. We will continue to work with our MPs to lobby strongly for funding and we have every confidence that we will be successful."

Cornwall's Response - Business Leaders

James Staughton, MD, St Austell Brewery (quoted in Western Morning News): "With this funding tied to a strict timetable, any delay risks jeopardising important projects and raises the frankly dreadful prospect of this much-needed European Union investment having to be returned unspent."

Your Views

Here's a sample of what people are saying about the freeze on Facebook and Twitter:

"Government has pledged to make UK fastest broadband nation in Europe" http://bit.ly/arRugF Great start in Cornwall then - @L00karound

It's important to overreact. Now, is the time to pressure, push and cajole - @mywoisme

Time for all businesses to identify what they want from new Local Enterprise Partnerships.there needs to be consultation. - @EnterpriseIain

Even a delay until the spending review could cause havoc - what if this leads to (for example) private sector broadband providers pulling out in the face of of what appears to be a government wobble? NB Convergence has a deadline that won't change - putting things on hold could kill off invetsments that were already tight on timing. - Tim Dwelly

I will almost certainly lose my job if this is not sorted out soon - thanks David Cameron!! - Tom Lal

The funding has been administrated by SWERDA and don't let's forget that abolishing the RDAs was one of the Conservative party's objectives. It might just be that they are looking for another way to administrate it. But cynically, I'm not holding my breath. I gather that convergence funding was conditional on the Government providing something too, and I suppose that they could withold that part so that the European money couldn't come through. - Caroline White