Hope for farmers, business and scientists as Treasury announces it will plug post-Brexit funding gap
In a major announcement which Mr Hammond said would cost around £4.5 billion a year, the Treasury will plug the post-Brexit funding gap for projects which receive EU structural and investment funds and which are approved before the Autumn Statement.
Projects that gain approval after the mini-Budget - expected in November or December - will be assessed by the Treasury to see if they should also get a guarantee.
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Hide AdBefore the referednum in June, more than £600m of EU funding was due to head to Yorkshire to help the region's economy grow. The money became a significant issue in the campaign as concerns were expressed about the possible impact of Brexit on areas like Yorkshire, which have historically been major recipients of EU cash.
Guarantees wanted over the future of European millionsThe Treasury's announcement included organisations that bid competitively for European Commission funding, such as universities applying for Horizon 2020 research money, who will also have their payments underwritten.
And the Government will maintain Common Agricultural Policy pillar one funding for farmers until 2020, as a domestic system is put in place.
But industry bodies, representative groups and campaigners have called for further guarantees amid concerns that the likes of scientists and researchers have already missed out on funding due to uncertainty caused by the vote to leave the EU.
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Hide AdThe Royal Society fellowship of scientists described Mr Hammond's announcement as "very welcome news".
But its president Sir Venki Ramakrishnan said some scientists had already missed out on collaborative projects because European colleagues were worried about funding.
The National Trust and British Chambers of Commerce said they were worried about the Autumn Statement cut off date.
A National Trust spokesman said: "We welcome the Government's decision to continue with funding for newly agreed and existing agri-environment schemes. But set against this is the continued uncertainty should new applications be restricted beyond this autumn. This would put at serious risk decades of effort by farmers and organisations like ours to protect and enhance our countryside.
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Hide Ad"Farmers need certainty as we move to a more sustainable model of support for farming which puts the recovery and resilience of the natural environment at its heart. Better funded and more widely available agri-environment schemes would offer a 'bridge' between the old and the new, helping farmers prepare for a future of new market opportunities whilst delivering greater public benefits from public money. "
British Chambers of Commerce acting director general Adam Marshall said projects "crucial to local business success and confidence" have been at risk since the referendum due to the lack of clarity over funding and welcomed the move.
But he added: "The delays that many worthwhile projects face in the approval process must also be cleared away - especially given the fact that the Treasury guarantee only covers projects signed by this year's Autumn Statement."
The CLA, which represents over 32,000 farmers, landowners and other rural businesses said the move was "vitally important" but called for a "world-leading" domestic funding policy to be drawn up and ready for 2021.
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Hide AdEnvironment Secretary Andrea Leadsom said: "This guarantee of funding is excellent news for our farmers and our environment.
"I'm delighted we can provide this crucial certainty and continuity to our rural communities while we develop a new approach to supporting agriculture and protecting our precious countryside."
Making the announcement, Mr Hammond said: "We recognise that many organisations across the UK which are in receipt of EU funding, or expect to start receiving funding, want reassurance about the flow of funding they will receive.
"That's why 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.
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Hide Ad"The Government will also match the current level of agricultural funding until 2020, providing certainty to our agricultural community, who play a vital role in our country.
"We are determined to ensure that people have stability and certainty in the period leading up to our departure from the EU and that we use the opportunities that departure presents to determine our own priorities."