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Government boosts North East’s Local Growth Fund allocation by further £49.7m

A £49.7 million allocation of Local Growth Funding from Government has taken the 2015-2021 total for the North East to £379.6 million.

The majority of the funding will be used as investment into the International Advanced Manufacturing Park (IAMP) near Nissan, which will secure 5,200 jobs for the North East economy by 2027.

The IAMP is a 100-hectare site that bridges South Tyneside and Sunderland and aims to provide a world-class environment for high-tech industries and advanced manufacturing businesses on a site just north of Nissan’s existing manufacturing plant.
The IAMP will bring huge benefits for the North East Economy and will support and grow the established supply chain in the area.

The Park will significantly strengthen the region’s reputation as the UK’s automotive sector national hub and show case the smart specialisations skills of the North East and help increase the offer to inward investors.

Andrew Hodgson, North East Local Enterprise Partnership Chair, said: ‘This latest growth deal allows the North East LEP to invest and drive forward the delivery of the International Advanced Manufacturing Park. We will work with our local authority partners, North East Automotive Alliance and the private sector to deliver this vitally important scheme, which is of strategic importance not only for the North East, but for the UKs industrial strategy.’

“The Government has chosen not to back our full Local Growth Fund bid which is deeply disappointing and potentially damaging to our Strategic Economic Plan to grow the North East economy.

“Our LGF allocation gives us no scope to fund a range of projects which would have driven new growth and provided real impetus to business development – as well as giving the North East the chance to contribute more fully to the Government’s Northern Powerhouse agenda.”

There will also be a small allocation to fund a Business, Innovation and Skills Infrastructure programme which will support businesses seeking to grow and develop, and provide workers with the necessary facilities needed to improve their skills.

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£26m ERDF call for organisations to lead North East growth and tackle flood dangers

Innovation, high growth businesses and reducing flood risks headline a new £26m call for applications from the European Union in the North East.

The latest round of European Regional Development Fund (ERDF) investment earmarked for the region seeks expert partners to deliver maximum return on the £26m cash pot.

The North East Local Enterprise Partnership works closely with Government to ensure that the European Funding allocation is aligned to projects that help deliver the North East Strategic Economic Plan.

The latest funding round consists of:


• Up to £16m to promote research and innovation. The North East LEP has a goal of making the region an innovation hotspot in Europe.

Investment will concentrate on backing companies working in the North East’s four ‘smart specialisation’ areas of passenger vehicle manufacturing, subsea and offshore technology, life sciences and healthcare and creative and digital industries

• Up to £2.5m to enhance the competitiveness of small and medium sized firms. This investment is looking to increase the density of high growth SMEs in the North East LEP area.

These firms have a disproportionately high positive impact on regional growth – in 2014 it is estimated the North East had 600 high growth companies with a combined turnover of £2.4bn and 21,000 employees. A 25% increase on 2014’s figure could generate an extra £186m of regional GVA and create nearly 4,000 new jobs

• Up to £8.6m to address specific environmental risks, ensuring disaster resilience and developing disaster management systems.

In the North East LEP area there is a determination to reduce the risks from flooding and climate change. Local partners are being sought to find innovative and new ways to reduce flood and erosion risk to economic infrastructure and businesses, enabling them to survive, thrive and grow.

Andrew Hodgson, North East LEP Chair, said: “The UK is still very much in the European Union and until we leave it, the North East LEP is determined to take the maximum opportunities for the regional economy from the investment offered by the ERDF programme.

“This new funding call presents a real opportunity for North East businesses and organisations which I urge them to pursue if they have a viable project which meets ERDF objectives.

“I would urge companies and organisations wanting to know more to visit the North East LEP website for more information.”

The North East LEP will be holding an information event giving more detail about the calls on 5 January 2017. To register to attend the event, please click here.

Chancellor of the Exchequer Philip Hammond has extended the European Union funding guarantee to the point of Brexit, confirming that the Government will honour European Structural and Investment Fund (ESIF) projects signed before Britain leaves the EU.

The 2014-2020 ESIF are planned to inject more than £437m into the North East. ERDF is part of the total ESIF North East allocation.


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North East LEP Autumn Statement reaction

The North East Local Enterprise Partnership today welcomed Government focus on boosting productivity through infrastructure, innovation and business growth measures in the Autumn Statement.

Andrew Hodgson, North East LEP Chair said:

The Chancellor of the Exchequer Philip Hammond’s focus on raising national productivity through substantial infrastructure and innovation investment mirrors the approach of the North East’s Strategic Economic Plan.

We welcome the Chancellor’s recognition that we are making a stronger contribution to the national economy through the creation of more and better jobs.

The Government has committed to investing £23bn into a National Productivity Investment Fund to boost innovation and infrastructure over the next five years which provides opportunities for our region to exploit.

We welcome the Chancellor’s focus on 5G broadband development through a £1bn fund and trials programme – the region has written to the Chancellor with a proposal to create a trial site for 5G in the North East.

The £220m funding for pinch points on strategic roads gives the North East an opportunity to further develop schemes in relation to the strategic highway network in the region.

Investment into the ultra-low emission vehicles sector represents a major opportunity for the North East with its strong automotive sector and highly developed low carbon vehicle programme.

We are delighted that our joint proposal for a Science and Innovation Audit with other Northern LEPs will be going ahead in round two.

A group of tax changes will benefit companies in the region’s rural and urban communities.

We look forward to learning in the coming days the allocation of funding to the individual Northern LEPs through the Local Growth Fund to finance strategic capital projects.

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Deal signed for new £145m super fund for the North East

A £145m super fund to support the growth of hundreds of North East businesses will go live early next year after an agreement was signed today.

The North East Fund – formerly known as JEREMIE 2 – will offer different types of equity investments and loans to firms to drive local growth, investment and job creation in the region.

The agreement has been signed by the seven Local Authorities in the North East, North East (SPV) Limited and the Department for Communities and Local Government (DCLG) which has responsibility for the European Regional Development Fund (ERDF) in England.

The announcement has been heralded as a milestone in public sector support for regional business growth and will be a catalyst to access significant European Investment Bank (EIB) investment.

Over the next five years, the North East Fund will pump loan, equity and mezzanine funding into new and existing fast-growing businesses across a wide range of sectors which will spearhead new regional economic growth.

The North East LEP led the project team negotiating for the region, and agreed with Government to develop the North East Fund at the Autumn Statement last year, to ensure that the super fund would be managed and spent exclusively in the North East. It sits alongside the Northern Powerhouse Investment Fund (NPIF) operating in other LEP areas to drive business growth right across the Northern Powerhouse.

The new fund combines ERDF backing with EIB finance and legacy money generated from historical funds which have operated in the North East LEP area since 2003.

It is estimated that the North East Fund could provide financial support for 600 businesses; help create around 2,500 jobs in the next five years and a further 1,000 jobs throughout the life of the fund – and deliver a legacy fund of up to £80m over the next decade for further financial support to companies.

Andrew Hodgson, North East LEP Chair, said:

Securing The North East Fund for investment into our region is fantastic news and the result of many months of hard work by regional partners with Government.

“The agreement signed today with Government ensures the Fund stays in the North East, to back the investment plans of our fastest growing, brightest firms. It is a prime example of public sector partners working together to achieve maximum return for the North East economy.

Councillor Paul Watson, Chair of the North East Combined Authority (NECA), said:

The first round of funding was a very successful scheme. It’s very pleasing to know that our region has now secured a second funding scheme.

Businesses need access to finance because it helps them to plan ahead, to grow and expand, and to create jobs and economic growth in the North East.

Andrew Mitchell, of the Project Team charged by North East LEP with delivering the Fund, said:

This is great news for the region. Despite the uncertainty created by the Referendum, this is a vote of confidence in the North East on the part of the European Investment Bank which will be a key partner in the fund. The commitment of North East LEP, the seven local authorities and Government to delivering a regional fund has been crucial in unlocking this programme.

Stephen Lightley, Chief Executive Officer of North East Access to Finance Limited, said:

It is great news that Government approval has been secured for the North East Fund and that the North East LEP’s share of the financial legacy of the public sector SME investment funds that invested from 2003 to 2009, is providing a key element of the finance for the new fund. It was always the vision of local stakeholders that returns from these older funds would be redeployed into future funds and now it is being achieved.

The NECA Leadership Board agreed to put special local authority borrowing powers in place which ensured the North East Fund will be ready to invest in 2017, after the hugely successful Finance for Business North East Fund stops investing in December.

That fund invested £147m into 900 North East and Tees Valley companies and to date has created almost 3,300 new jobs, safeguarded a further 3,300 and brought over £160m of further private sector investment to the region.

It is envisaged that the North East Fund will help finance viable firms unable or partially unable to secure loan funding from the banks and other sources.

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£2m Port of Blyth Training Centre opens

The Duchess of Northumberland has opened the latest phase of a wide ranging development at the Port of Blyth dedicated to the provision of education, training and opportunities.

Once famous for coal, the port is now a leading offshore energy base in the North East and has this week opened the doors to a £2m training centre designed to prepare the UK port services, offshore and renewable energy workforces of the future.

The second phase of a development known as the Blyth Education and Community Hub (BEACH) sees the Port partner with award winning training provider Port Training Services, Newcastle University, Northumberland College and other regional partners.

Whilst the development offers Newcastle University students the use of state-of-the-art research facilities including the Emerson Cavitation Tunnel Laboratory, the centre will also host landmark renewable energy related training courses from Northumberland College – some of the only course of their type available in the UK.

Port of Blyth’s training subsidiary Port Training Services is to develop its offering of NVQ’s and plant training, while enhancing its delivery of apprenticeships and community engagement through a thriving schools partnership and an innovative tie in with the Blyth Tall Ship charity, who deliver training and create opportunities for local young people not in education or employment.

Whilst all partners in the project have committed notable funds to the development, this latest phase of the hub has attracted significant funding from the Coastal Communities Fund, North East LEP and Sport England.

Martin Lawlor, Chief Executive of Port of Blyth, said: “We’re delighted that the Duchess of Northumberland was able to join us again – having opened phase one of this development – to launch a second phase that will offer the people of Blyth, South East Northumberland and beyond significant opportunities for training, education and ultimately employment”.

Phase one of the Blyth Education and Community Hub, which opened in 2014, delivered a maritime heritage centre, an Engineering and Marine Science base for Newcastle University as well as a new facility for the training and community outreach charity Blyth Tall Ship and striking home for the Blyth Boathouse restaurant. Investment in phases 1 and 2 totals £3.5m.

Part of the project’s funding – £400,000 – was from the North East LEP as part of the North East Growth Deal from Government. The Local Growth Fund supports major capital investments to promote innovation, economic and skills infrastructure and sustainable transport across the North East LEP area.

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In Conversation with North East LEP Chair, Andrew Hodgson: North Easy Ready To Capitalise on EU Funding Guarantee

The North East ready to capitalise on EU funding guarantee.

The announcement by the Chancellor of the Exchequer Philip Hammond extending the European Union funding guarantee to the point of Brexit is an opportunity the North East is determined to seize.

Confirmation that the Government will honour structural and investment fund projects signed before we have left the EU is welcome news.

We now hope that this signals that the programmes will start to flow again.

In the North East, we are ready, poised and waiting with our partners to ensure those projects in the pipeline get over the line and secure much needed EU funding.

The Government is clear about the criteria projects must meet for this to happen.

They must continue to meet EU funding rules but must also demonstrate good value for money and be in line with domestic strategic priorities.

In the North East, we have a very strong pipeline of projects.

Many of them are aligned with the priorities of the refreshed North East Strategic Economic Plan, produced after widespread consultation by the North East Local Enterprise Partnership with its partners.

It’s about making sure that we all have those projects lined up and ready to respond to any opportunities that might be forthcoming.

And the only way to get more projects to come forward now is to have more application rounds or calls.

We are waiting for Government to press the button and invite more applications which could be before or after the Autumn Statement on 23 November.

We know where we are going with a clear vision and plan and it’s the LEP’s role to make sure that the strategically important projects are supported by our local partners.

It’s important at this point to take stock of what is at stake here and why this investment is so important to our region.

The North East was originally allocated £437m in European Structural Funds up to 2020. Out of that central pot, at present over £198m remains unallocated.

Some of this funding is earmarked to support business growth and job creation. The LEP and partners recognise the need to support more business start-ups, create more growth through innovation, and support more small and medium sized businesses to export.

The European Social Fund is funding earmarked for skills and employment support, helping the unemployed and economically inactive back into work and supporting those in work to up-skill and re-skill. This will mean employees in the workplace will get the opportunity to progress their careers, and to provide them with the opportunity to progress from part-time to full-time work.

We also have key sectors that we need to support with digital skills, a need identified in the work we did with the business community in the SEP refresh and a key Government priority.

We need to ensure that people within traditional industries have the skills to allow them to take the career progression opportunities further up the ladder.

In the healthcare sector for example, one of the gaps we can see emerging is the need for more skilled individuals able to support the sector’s growth.

The 50-plus workforce could lend itself well to this sector, they have the capability to fill these roles given their life experience, but they need new skill sets to take those opportunities.

We are saying to Government that we are ready and poised and we know what our priorities are.

We will work tirelessly to take the funding opportunities when they arrive.

North East England is one of the UK regions which needs EU funding most, with a proven track record of investing it well.

If this money is committed, it could see our region with structural funding in place up to 2021-2022, which gives Government the time to create the new policies to have new funding streams in place for the period after this.

There is a need to do this. Let’s get this moving and let’s do this well.

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Horizon 2020: European fund seeks innovative business projects

Horizon 2020: Businesses can apply for funding for a range of business projects in areas from food security to smart cities and green vehicles.

A European funding programme is to invest more than €550 millon across 6 initiatives launched this month.

Business support is available for projects in a range of fields including sustainable food security, rural innovation and business, marine projects, the bioeconomy, smart cities and green vehicles.

The funding is part of the EU’s Horizon 2020 fund for researchers and business, which aims to ensure Europe produces world-class science and that barriers to innovation are removed.

Find out more about Horizon 2020.

Government underwrites European funding

The UK Government recently said that businesses and universities should continue to bid for EU funding while the UK remained a member of the EU and that it would underwrite payment of awards even when projects continued beyond UK membership.

Find out more about the UK Government’s guarantee on funding for participants in EU projects.

The funding opportunities

Six new Horizon 2020 funding calls are now open.

Sustainable food security: €280.5 million is available across a variety of topic areas in crop and livestock production and aquaculture. Closing date 14 February 2017. Find out more

Rural renaissance: €61 million is available across a variety of topic areas including land management, rural business models and speeding up innovation in rural areas. Closing date 14 February 2017. Find out more

Blue growth: €48.4 million is available across a variety of topic areas including specialised vessels for coastal and offshore activities, clean coasts and seas, improving seafood and monitoring of fish stocks. Closing date 14 February 2017. Find out more

Bio-based innovation for sustainable goods and services: €26.4 million is available across a variety of topic areas including forest production, strategies for improving the bioeconomy and a plant molecular factory. Closing date 14 February 2017. Find out more

Smart cities and communities: funding is available to demonstrate innovative integrated infrastructures. Closing date 14 February 2017. Find out more

Green vehicles: €133 million is available for nine topics including integration of electric vehicles with the grid, aerodynamics, and powertrain development. Closing date 1 February 2017. Find out more

Competition information

•all competitions are open
•Horizon 2020 funding opportunities are open to everyone in an EU member state
•projects must be a consortium of at least 3 organisations and each member must have a legal standing such as registered business, partnership or charity
•there are national contact points who can help you to apply for Horizon 2020 funding and to find consortium partners

Find a national contact point.

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North East LEP seeking Government assurances on Euro funding

Brexit and its impact on European Union structural funding will be more keenly felt in the North East than any other region.

We have an outstanding track record of securing substantial investment from Europe and investing it wisely to drive our economic growth.

While I can’t give cast iron guarantees about future EU funding, I think it’s important to outline where we are currently at and what the North East LEP is doing to press Government for assurances so we can plan ahead for a future without EU investment.

The North East LEP area has £90m of its total £437m EU funding allocation committed to projects planned to run until 2020.

We also have £104m worth of projects in the pipeline, put forward to Government for approval before the referendum vote.

There are big numbers attached to these schemes. In total, they will assist more than 7,400 businesses, support almost 30,000 people into work and help upskill people in work.

So far the Government has stated that it is ‘business as usual’ for contracted projects.
However, for the £104m of pipeline projects, the assurance of being able to secure EU funding is uncertain.

There are two important issues that we are seeking urgent Government assurance on.

Firstly, quantum. We have had verbal commitment – albeit from ministers no longer there – and quite strong public comments that the Government is committed to replacing the quantum of support that the North East currently has from the EU.

There have been more mixed signals since the referendum, however, about whether they will honour the full amount.

We have not had unequivocal certainty from Government. That is fuelling economic uncertainty and we need a commitment quickly that they will underwrite the full amount.

If the Government does commit to match the EU funding being lost, then that brings us to a second issue.

Can the Government commit to an absolute timing mechanism that triggers as soon as the EU funds stop?

That would allow our partners match funding the big structural projects to be able to develop their business cases and plan ahead with greater certainty for the longer term.

The future of the £120m Jeremie 2 fund is another hugely important issue for the North East.

European money makes up half of the fund which we worked hard to keep in the region for the exclusive support of North East small and medium-sized businesses.

We are seeking assurance that there will not be a negative impact on Jeremie 2 due to Brexit. In parallel, we are also exploring alternative ways to deliver similar support if that scenario arises.

A substantial amount of regional funding comes from the UK, through the Regional and Local Growth Funds and Enterprise Zones.

We handed our final submission for Local Growth Fund 3 to Government this week. We have put forward a very ambitious list of projects for the North East.

A really positive signal from Government would be a positive response to our Local Growth Fund bid – that would demonstrate real confidence in our economic future.

By Andrew Hodgson, North East LEP Chair

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The North East Growth Hub provides support and access to over 300 business finance providers

Businesses in the North East LEP area now have access to specialist hands on support to access the most appropriate types of finance required to fuel their growth.

Local businesses who are seeking to invest in their growth can access free specialist support through the North East Growth Hub to identify, compare and apply for all types of business finance. The service is impartial and objective and helps businesses to quickly, simply and transparently review over 300 business finance providers who collectively offer thousands of products covering every type of business lending from asset finance to growth finance as well as every type of secured and unsecured business financing.

Through this service, the North East Growth Hub, working alongside access to finance specialists Rangewell will help local businesses of all types and sizes to access every type of business lender in the UK including high street banks, challenger banks, specialist and boutique lenders, as well as online and alternative finance providers.

Luke Kovic, Head of Access to Finance for the North East region at Rangewell said: “Rangewell work with all types and sizes of business and we know only too well how often businesses struggle to access finance even though there are many specialist lenders out there who would be willing to provide them with appropriate and sensibly priced finance. Rangewell pride ourselves on offering an independent, in depth and in-person service to help North East businesses access finance in a simple and transparent manner allowing them to focus on doing what they do best – growing their business and supporting the local community”.

Colin Bell, Business Growth Director, North East LEP added: “Accessing finance is essential for many growing businesses, yet with so many options it is difficult for businesses to identify the right solutions for them. The North East Growth Hub now provides impartial and objective support to access over 23,000 financial products which makes it easier for businesses to identify the most competitive products and the Rangewell platform and one-to-one support provided should have a significant impact on the number of businesses successfully accessing finance’’.