The UK government will guarantee £4.5bn to organisations across the UK who face losing EU money after Britain voted to leave the EU. Hundreds of farmers, universities and under-developed regions in the UK are facing a shortfall due to the Brexit vote.
Newly-appointed Chancellor of the Exchequer Philip Hammond will guarantee the money for infrastructure projects and university research programmes until 2020. Hammond hopes that by promising investment in the UK he can foster confidence in the UK economy and avoid an economic downturn.
Despite the Chancellor having more money than before the Brexit vote, as Britain will no longer have to pay £8.5bn in net contributions to the EU, many experts have warned that the UK could be on the cusp of a recession.
Sky News say that 14 to 15 different EU schemes would be covered under the guarantees set to be outlined by Hammond tomorrow (Saturday 13 August). By making the assurances he hopes to: "to ensure that people have stability and certainly in the period leading up to our departure from the European Union".
"We recognise that many organisations across the UK which are receipt of EU funding, or expect to start to receive funding, want reassurance about the flow of funding they will receive," the Chancellor will say.
In addition, Hammond has earmarked cash to fund all structural and investment projects signed before this coming. This is because he wants to ensure that universities and other organisations keep bidding for EU funds.
He will add: "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."
His plans are good news for farmers who will continue to benefit from EU common agricultural policy pay-outs, which came to nearly £2.4bn in 2015, until 2020. EU structural funding, worth up to £2.3bn a year, which helps build roads, infrastructure investment in poorer areas, science and research facilities, will also be guaranteed.
A Reuters poll published on 11 August suggested that Britain has likely already entered the early stages of a technical recession that is likely to persist into early 2017.