FM’s Brexit negotiations must recognise value of third sector

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Maggie Lennon says that FM’S Declaration of EU Principles gives a shout out to agriculture but it could mean Cold Comfort Farm for the third sector

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26th July 2016 by TFN Guest 0 Comments

I listened with interest this morning to the First Minister's much heralded speech on the five principles on which she would form the basis of our contribution to the UK Brexit negotiations. In a party that has had more than just a few red lines, these are the most recent. It's not for me to say whether her central focus on full access to the free market and freedom of movement is at odds with the UK's hard approach to Brexit, or to question what the political ramifications might be if there is no agreement is reached between them.

The speech was long on the FMs thinking in the last month but short on specifics behind the principles, but that’s maybe to be expected given the relatively early stage we are at. Also, she was never likely give away her strongest bargaining chips too early in the negotiations or to the media first.

Maggie Lennon

Maggie Lennon

But while farmers and universities are publically acknowledged, there was no reference to the importance of the third sector, the third pillar, in all of this

However, although solidly pro-Europe, I am slightly uneasy that so much of the focus, from all media and from all sides, has been on the economy. True, the FM talked about protecting workers rights, co-operation against terrorism, and democracy, however, the economy was central. But she went a bit further, within the economy she made reference – pretty much the only specifics in her speech – to two of the three sectors who have most to lose from Brexit. She said that our economic interests must be protected, "safeguarding free movement of labour, access to a single market of 500 million people and the funding that our farmers and universities depend on.”

But while farmers and universities are publically acknowledged, there was no reference to the importance of the third sector, the third pillar, in all of this. The FM did not explore the devastating impact if we can’t also negotiate a fair distribution of structural and social funds. It’s this policy blackout that worries me.

Policy gurus will not doubt try and calm fears by saying that of course if we are paying in, we will be getting back, and not just in university research grants and Common Agricultural Policy payments. But it’s not only that rgua principle needs stating, but that there also has to be exploration of the impact of us getting a less generous settlement.

As it currently stands Scotland contributes 8% to the full payment to Brussels from the UK, but gets back 18% of the EU grants to the UK. That’s because EU funds are designed to flatten out the anomalies of national economies, moving money away from the hot spots to regions that are less well off.

It’s the basis of the similarly positive payments to Northern Ireland, Wales and Cornwall. For us to get back more than we pay in as an independent country, or an independent contributor within the UK, we would have to be net gainers, and countries with an economy as strong as Scotland’s wouldn’t normally be given such terms.

So where does the Scottish economy fit in the scale of the other 27 EU nations? And if we are not poor enough to be net gainers what would we need to send to Europe to get the same amount back? 

Now I’m not looking for anyone to write this up on a side of a bus, but I do want to know whether part of the negotiations will focus on continued support for current ESF funded job creation and economic development and regeneration projects, delivered in large part by the third sector. Or indeed if the Scottish Government already has some ideas how the economy would fair on the giving and receiving scale of things.

If this is still all to be played for, fair enough, but harking back to an earlier blog where I asked for a more open honest and transparent relationship between the Scottish Government and the third sector, I think we need to be having these frank discussions.

I know that it is often better to give than to receive, but when it comes to third sector security, that really is really not the case.

Maggie Lennon is director of the Bridges Programme.