European funding - making a difference to Scotland

Scotland has received European funding for more than 20 years, under the EU's Regional Policy. During that time well over £2,000 million has been spent on a huge variety of projects in the designated areas of Scotland - normally matched pound for pound by money from national or local government or other sources. This funding represents a sizeable 34 per cent slice of the European Commission's annual budget of over €100,000 million (£650,000 million) and is aimed at three main "Objectives":

• Objective 1: support for regions that are lagging behind the rest of the EU in economic development - measured as those regions where the GDP is less than 75 per cent of the EU average. The Highlands and Islands of Scotland were classified as Objective 1 until the year 2000 and now this area has a special transition programme of support until 2006;
• Objective 2: support for areas undergoing economic and social change - this covers urban and rural areas where traditional industries are in decline and new sources of employment must be found, and
• Objective 3: measures to tackle long-term unemployment and social exclusion.

The 'Structural Funds' used to provide this support are the European Regional Development Fund (ERDF), used for Objectives 1 and 2 and the European Social Fund (ESF), used for Objective 3. Specific funds for agriculture (EAGGF) and fisheries (FIFG) are also used in the Highlands and Islands area.

The ERDF focuses mainly on "physical" economic development - productive investment, infrastructure and enterprise development - while the ESF supports human resource training and development measures.

In addition there are four Community initiatives, also derived from the Structural Funds, which provide additional support in special situations. These are:

• EQUAL - aimed at combating all forms of discrimination in the labour market;
• LEADER+ - supporting the sustainable development of rural areas;
• URBAN II - encouraging innovative regeneration of urban areas, and
• INTERREG IIIb - promoting trans-national solutions to the problems of particular areas e.g. the northern periphery and Atlantic areas of Europe.

The current programme may be the last in its present form. The European Commission's funding priorities are being reviewed in the light of the needs of the 10 new members of the EU. Consequently special transition programmes have been put in place covering the period 2000-06. Nevertheless, the Structural Funds available to Scotland for this period total over £1,200 million. Click here for further details of EU funding schemes available in Scotland, including the many non-structural ones (there is a link to 'European Funding and Scotland').

The Scottish approach to European funding

In Scotland a unique partnership approach is used to identify the eligible areas and manage the funding process. Members of the partnerships typically include the Scottish Executive, local councils, Scottish Enterprise and the "local enterprise companies", further and higher education institutions, area tourist boards, the voluntary sector and community groups. There may be up to 200 members in each programme area, and every agency has equal status.

The Scottish Executive delegates responsibility to the partnerships to prepare the "single programming documents" (SPDs), these are the "bibles" setting out the priorities for how the funds are to be spent. The partnerships also manage the implementation of the programme by calling for and appraising projects as well as controlling and monitoring spending. This approach has worked well since 1988. It ensures that all relevant government bodies and local organisations have their say in how the money is spent.

There are four partnerships covering the designated areas of Scotland and one covering the whole of lowland Scotland for Objective 3. These are:

• the Highlands and Islands Partnership Programme
• Strathclyde European Partnership
• East of Scotland European Partnership
• South of Scotland European Partnership
• the Scottish ESF Objective 3 Partnership

Broadly speaking all the partnerships adopt a similar approach to planning, programme implementation and management, involving a number of committees drawn from the members. These meet in regular cycles to ensure the momentum of the programme is maintained and that the funding is spent within the "N+2" rule: funding committed to a project in, say, 2003 must be spent by the end of 2005 - "use it or lose it!" This process also keeps the members of the partnership fully aware of how the programme is running. It allows informed reviews of the SPD to take place from time to time, to take account of significant changes in the economic structure of the region.

Projects of every size and sector

The range of projects supported is wide. Among the largest "flagship" education and tourism-related projects are:

• Glasgow Science Centre - providing a hands-on introduction to science and technology for young and old;
• Loch Lomond Shores - a compelling visitor centre and leisure shopping complex at the southern tip of Loch Lomond, and
• The Millennium Link project - the exciting regeneration of the Forth and Clyde and Union Canals incorporating the incredible Falkirk Wheel canal boat lift.

These projects each cost more than £25 million and hold the promise of creating many hundreds of jobs both directly and indirectly.

The mix of successful projects also includes business-focussed ones such as the Hunter Centre for Entrepreneurship at Strathclyde University and Targeting Technology Ltd, a business support organisation aimed at increasing innovation and technology spin-out from the universities in west-central Scotland (which has since become part of Targeting Innovation Ltd). Targeting Technology also coordinates the Innovation Relay Centre for Scotland (IRC). This is part of a Europe-wide network of IRCs established by the European Commission to promote technology transfer and participation in the EU research and technology framework programmes. The Innovation Centre at Hillington Park outside Glasgow also provides accommodation for new cutting-edge firms.

In the east of Scotland, the Business Environmental Partnership advises local firms on the benefits of environmental management. On the same theme, the Galloway Fisheries Trust manages the freshwater fishing rivers in south west Scotland.

Although individual businesses are generally not eligible to apply direct for funding, they may benefit from projects such as those above, and also schemes such as Eastern Scotland Investments and Strathclyde Investment Fund which are partially supported by the European Regional Development Fund (ERDF).

The current emphasis on e-commerce in business is reflected in the funding of an interactive website and advisory service for SMEs seeking to enter the world of e-business in the Highlands and Islands.

The innovative use of the Internet is further highlighted by an award winning website and marketing campaign supported by ERDF to attract visitors to the uniquely beautiful outer limits of the Highlands and Islands. The programme is also supporting the Initiative at the Edge, a regeneration strategy for these very peripheral areas.

At the other end of the country, the Scottish Borders Tourist Board received support for their acclaimed website.
Community and learning-orientated projects include Rosemount Lifelong Learning and Edinburgh Women's Training Course partially funded by the ESF (Objective 3 programme). Nisus Scotland, which runs the EWTC has also received European funding to sustain and further develop services in 2006, with ESF money being secured for FlexIT (£72,000), Skilltech (£73,000) and Quaytech (£49,000).

These few projects barely touch the surface of the thousands that have been supported by the EU Structural Funds in Scotland over the years - mostly identified by the familiar circle of gold stars. Others well worth looking at, on the web or in person, include: New Lanark heritage village and hotel, the Centre for Contemporary Arts in Glasgow, Kittochside Museum of Scottish Country Life, the House for an Art Lover and The Tall Ship.

The European Social Fund has helped finance the Employability through e-learning project - a vocational training programme aimed at improving jobseekers' skills so that they are better placed to obtain jobs in the field of information and communications technology.

Scotland's largest photovoltaic system is located at Sir E. Scott School in the Western Isles. The demonstration project, which cost £315,000, is intended to stimulate demand for photovoltaic technology and to help promote the Western Isles potential for producing renewable energy.

The evidence is there: European funding has made a big difference to Scotland!