Scotland politics

Brexit: Derek Mackay says funding pledge 'falls short'

Scottish and EU flags Image copyright AFP
Image caption What are Scotland's options for maintaining a relationship with the EU when the UK leaves?

Scotland's finance secretary has said the Treasury's pledge to replace EU funding does not go far enough to end uncertainty after the Brexit vote.

Derek Mackay said the "limited" funding was hundreds of millions of pounds short of what Scotland would receive as an EU member.

Chancellor Philip Hammond guaranteed to back EU-funded projects signed before this year's Autumn Statement.

Agricultural funding now provided by the EU will also continue until 2020.

Mr Mackay has written to the Chief Secretary to the Treasury David Gauke acknowledging the UK government's commitments but saying they still leave almost £750m not yet guaranteed.

He said: "We will study the detail but what is already clear is the chancellor's approach falls far short of what fishermen, farmers and communities across Scotland need.

"A limited guarantee for some schemes for a few short years leaves Scotland hundreds of millions of pounds short of what we would receive as members of the EU.

"Major funding streams such as contracts for EU structural funds and European Maritime Fisheries projects beginning after the Autumn Statement have no guarantee of continuation at all. That simply isn't good enough.

"It puts at risk significant investment and jobs, revealing the reality of Brexit.

"Scotland didn't back Brexit and doesn't want Brexit. We certainly should not now see funding and investment in communities hammered as a result of Brexit."

Image caption Derek Mackay said the chancellor's funding promise fell short of what Scotland stood to lose by leaving the EU

In the EU referendum 62% of Scottish voters wanted to retain membership while the UK as a whole voted by 52% to 48% to leave.

First Minister Nicola Sturgeon has promised to "explore all options" to secure Scotland's place in the EU, including another independence referendum.

The chancellor's announcement of guaranteed funding is expected to cost the Treasury £4.5bn a year.

Mr Hammond said: "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."

Prof Dame Anne Glover, dean for Europe at Aberdeen University, said: "The statement by Phil Hammond delivers some certainty around H2020 funding until the UK leaves the EU.

"It may provide confidence amongst our EU collaborators that our involvement in proposals will not compromise the success of applications and that is welcome.

"The research community needs to continue pressure to ensure this commitment is fully honoured."

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