This post is based on an article by our founder Gus Tugendhat, which originally appeared in the New Statesman.
As Theresa May delivered her ‘Road to Brexit’ speech at the end of last week, one topic was yet again left off the agenda: the extent of EU funding in UK government contracts.
Tussell’s new analysis has revealed that at least £1.6B of awards (excluding frameworks*) have been issued with full or partial funding from the EU since January 2015. £1.3B of this has been awarded since the Brexit referendum itself – somewhat ironically underlining the importance of programmes such as the European Regional Development Fund (ERDF) and European Social
Fund (ESF) to public procurement.
The education and skills sector is particularly reliant on the EU. Since January 2015, the Education and Skills Funding Agency (ESFA) has issued £425M worth of awards with EU funding. This is ahead of any other public sector buyer and makes up 76% of the ESFA’s total award value over the last three years.
Yet the EU’s reach goes beyond this, with the £1.6B spread across more than 1,000 contract awards. The Welsh Government and Cornwall Council have been other key beneficiaries – notable given that both regions voted strongly in favour of Brexit.
Public procurement has been overlooked in the Brexit debate so far, but there are important questions that the UK government must now address.
£433M of awards with EU funding are due to expire before Britain leaves the EU – the vast majority of this in the next four months. Although ministers have guaranteed funding for EU-backed projects that continue after Brexit, they have not been clear on those expiring before. Will the government provide funding to renew or replace the contracts that roll off in the next few months?
With the UK a net contributor to the EU budget, it could be argued that the government will have no trouble finding the money to plug these gaps once we have departed. However, Tussell’s data shows that there could be a crucial shortfall in parts of the public sector unless this funding comes to light.
* Frameworks are essentially preferred suppliers lists: agreements between a contracting authority and a group of suppliers that set out the terms of future procurement 'call-offs'.
Tussell uses public sector information (a) licensed for use by the UK Government under the Open Government Licence v3.0 and/or (b) from the EU Tenders Electronic Daily website licenced for re-use by the European Commission. This information remains the copyright of the UK Government and European Commission respectively.