East Anglia pays £7.67 for every £1 it gets back in EU regional funding

Recently, my time in Westminster has been dominated by the forthcoming EU referendum.  The select committee I Chair, the Public Administration and Constitutional Affairs Committee, has been looking into Government involvement in the referendum, and I have been active in the chamber debating the EU referendum bill.  Locally I have been hoping to see EU funds used to benefit our area for infrastructure projects and business development. 


Under our present arrangements with the European Union, the UK pays into an EU funding mechanism known as “structural funds”. When the concept was first proposed the idea was to fund projects that would help less-developed communities in Europe and improve Europe’s economy by investing in infrastructure projects.

But like much policymaking from Brussels, this is yet to be proved effective and according to the think tank Open Europe, we made a net contribution of £20.3 billion to these funds between 2007 and 2013. The East Anglian region is one of the highest contributors to the EU’s structural funds, providing over £1 billion over the same period. Open Europe has estimated that East Anglia pays £7.67 for every £1 it gets back in EU regional funding. Essex pays £8.37 for every £1.

Such a discrepancy might be more palatable were it not for the fact that out of the 37 regions in the UK providing funds to the EU, only 2, Cornwall and West Wales are net beneficiaries. As a country, we are currently the third biggest loser in this system, with 70% of our contribution going to other EU member states.

We are fortunate in the East of England to be in one of the most productive parts of the UK. Our total Gross Value Added (a measure of economic performance) was £116 billion in 2013, or 8.4% of the UK’s total GVA. But instead of investing our own funds in the redevelopment of the A120, or in our aging rail network, we are instead paying for the transport networks of our European neighbours. Unfortunately, it is the very fact that our region as a whole is economically successful that means East Anglia struggles to qualify for EU-funded projects as the region is not deemed to be poor enough.

The idea of rich countries pooling resources to then be redistributed around other rich countries has been roundly criticised not just by Eurosceptics but by policymakers from different parts of the political spectrum. In 2012, a group of 17 Labour MPs, including Jack Straw, wrote a letter to the Guardian saying “Let Britain keep the cash and get on with the job of using our own structural funds”. At the moment we are getting less back and we have to spend it in EU designated regions and on EU approved projects with matched funding that can distort what we would like to spend on.

It’s time to repatriate regional policymaking.