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Brexit: A view from the Wales Funders Forum

Watch any documentary about the EU referendum and you’ll see the obligatory picture from Wales. Usually someone from a town like Ebbw Vale, explaining their decision to vote ‘LEAVE’, standing outside a sparkling community building emblazoned with a starry logo denoting that it was funded by the EU.

So when the Wales Funders Forum met last week after the summer break, the first topic on the agenda was the “Impact of Brexit on Wales”.

The figures are stark. Wales has received £4b of EU funding since 2000 according to press reports. Over £105m of EU funds were committed to projects led by the third sector between 2007-13, through the European Structural and Investment Funds (ESIF) programmes.  Overall the EU provides 2% of the income of the voluntary and community sector, about the same proportion as grants from foundations. The picture seems bleak indeed.

And yet.

In the short term at least we heard that it is ‘business as usual’ for the current delivery of ESIF.

Naturally agencies with responsibility for distributing funding have begun conversations with delivery partners about the need for diversification, about helping VCOs and social enterprises to identify their funding shortfalls and gaps, with a view to filling them. The unspoken question here was… With what? At the margins, for some organisations, the answer may lie in social investment, or grant funding from other bodies. But clearly the size of these funding pots hasn’t increased simply because the UK is exiting the EU.

In the medium term confusion, as in so many other areas, reigns. While funding for farmers and scientists is ‘guaranteed’, no such assurance has been given for the third sector. Will projects still be approved once the UK invokes Article 50 but before we fully exit? We won’t find out until the Article is invoked and negotiations begin in earnest. And even then clarification of this particular point is unlikely to be high up the list of the Westminster government's priorities.

In the longer term others argued that it was all to play for. After all, the money that the UK government contributed to the EU has not disappeared. How it is spent is a matter of political priorities. A starting point for negotiations on behalf of the sector must surely be that promises will be kept and the third sector, which has been valued as equivalent to 7% of Wales’ GDP,  will continue to be funded – only with decisions made here, close to home, instead of in Brussels. One hopeful funder argued that this could liberate the sector from the straitjacket of bureaucratic EU monitoring requirements and result in funding that is lighter touch and more responsive.

It has been said before and it will be said again, that the tendency is always to overestimate impact in the short term and underestimate it in the long term. Several present thought it was way too early to even begin to assess the effect of Brexit – with the possible exception of impact on hate crime and xenophobia, depressingly up in Wales as elsewhere.

However, what is already clear is that engagement with our future outside the EU is of paramount importance. Funders and funded, UK and devolved governments must work together as never before. How very appropriate then that the agenda moved on to look at cross-sectoral collaboration and the importance of understanding the funding ecology. 

For up to date information on the emerging impact of Brexit on the Wales voluntary sector, see the excellent resource on WCVA’s website at: http://www.wcva.org.uk/what-we-do/eu-referendum/faqs

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