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Government claws back EU millions from Cornwall businesses

Most of the Cornish business community would have been shocked at the article broadcast on BBC’s Spotlight programme on the 12th of November and this would sent chills down the necks of business people who have built grant-aided projects in Cornwall, just at a time when the next programme is about to be launched!

It appears that the UK government is demanding Cornish businesses repay millions of pounds of European grants handed out to businesses and public sector organisations to promote economic development under the Convergence programme.

Businesses told the BBC that the Department for Communities and Local Government (DCLG) is demanding funds be returned due to EU rules not being followed. DCLG said the issue could affect businesses right across the UK and it had to ensure funding was properly managed. However affected organisations say the government is trying to retrospectively enforce new funding rules.

A DCLG spokesman refused to outline the specific issues being raised with businesses or the amounts involved, but this will undoubtedly refer to the procurement rules the grant beneficiaries used at the time of their project implementation to choose suppliers and whether this followed a robust and transparent approach as laid down within the EU procurement guidelines.

A spokesman for the EU commission said the rules “haven’t changed in the past couple of months” but did not respond to questions regarding who had launched the attempts to retrieve the cash.

With £500m of EU funding being made available in 2016, once again this stresses the importance of using a grant and funding specialist to ensure all the rules are met and ensuring that a beneficial cash injection of grant does not become a long-term liability that requires repaying.

Our funding specialist is available to brief on EU procurement rules, appropriate uses of public funding and the contractual output requirements for grant beneficiaries. Contact .