Brexit will be disastrous for disadvantaged groups unless ministers takes urgent action, MPs warn

Services supporting some of UK’s least advantaged communities risk being ‘bankrupted’ by loss of European Social Fund

The government has pledged to create a Shared Prosperity Fund serving a similar purpose to current EU funding, but the future is uncertain beyond that (Getty)

Brexit could be “disastrous” for disadvantaged groups, such as disabled people and young offenders, unless urgent action is taken to replace vital services, MPs have warned.

A report by the Work and Pensions Committee states that programmes providing support for some of the least advantaged communities risk being “bankrupted” due to the loss of the European Social Fund (ESF), which provides £500m per year of EU funding to these services.

The programmes it funds deliver employment and skills support to people who are poorly served or neglected by mainstream provision, including disabled people, offenders and prison leavers, the long-term unemployed and people with multiple barriers to work.

While the government has pledged to create a UK Shared Prosperity Fund (UKSPF) serving a similar purpose to current EU funding, the future is uncertain beyond that.

The report states that Brexit provides a rare opportunity for the UK to “create a truly world-leading successor” to the ESF “that is the envy of Europe”, citing weaknesses that exist in the current model.

But it warns that the government must “act fast”, saying the consequences of a gap in provision – for providers, for local areas, and for individuals – would be “disastrous”.

Frank Field, chair of the committee, said: “We now have an historic opportunity to create a truly fit-for-purpose successor to the ESF. The government must act quickly so that those excellent existing suppliers are not bankrupted.

“Effective reform here offers the government an important new chance to begin to fill our skills gap from the community upwards, instead of having a top-down approach.”

Frontline providers that receive funding from the ESF told The Independent it played a “vital” role in helping marginalised groups get the support they need to enjoy the same life chances as their peers.

One such project is Groundwork UK, which helps divert young people from gang culture, for which no resources have been identified to continue the programme once ESF comes to an end.

The project’s experienced youth workers provide one-to-one mentoring and group activities in 17 pupil referral units across London to support more than 200 young people identified as being gang members or at risk of exploitation or violence.

More than half have successfully made the transition back into mainstream education, which dramatically reduces their likelihood of offending.

Groundwork’s national chief executive, Graham Duxbury, said: “ESF funds play a vital role in helping those who are most marginalised in our communities get the support they need to transform their prospects.

“Without these kinds of programmes adding value to mainstream public provision, we’re storing up trouble – and expense – for the future, but more importantly denying thousands of people the opportunity to enjoy the same life chances as their peers.”

Another ESF-funded project is the Shaw Trust’s Aim4Work programme, worth £4m, which works with people aged over 25 who are out of work and experiencing common mental health conditions.

The charity’s integrated services director, Richard Clifton, told The Independent: “Without ESF funding, Shaw Trust would not have been able to support 70,000 disabled people, offenders and people with complex needs to gain new skills, improve their wellbeing and find work, over the past few years.

“Many people with complex needs are usually overlooked by other mainstream funding programmes. ESF is also vitally important for many smaller voluntary and community based organisations in our supply chain, such as our Aim4Work partners.

“It is therefore vital that the UK Shared Prosperity Fund, which will replace ESF, ring-fences this funding for such social programmes in future.”

Sam Windett, head of policy for the Employment Related Services Association (ERSA), a membership body for the employment support sector, urged the government to “act urgently” on the committee’s recommendations.

“This is no small issue – each year the ESF provides £500m of resource in England and Wales alone, offering skills and employment support to people often neglected by mainstream services. The government has a historic opportunity to develop a world-leading UK initiative from 2020 that replaces the investment made in employment support,” she said.

“This can help more people than ever before engage with communities more effectively and get more money to the frontline. Today’s recommendations are vital if the government is to tackle social injustices and build a more productive and inclusive economy.”

A Government spokesperson said: “We’re committed to providing support for disadvantaged groups, which is clearly underlined by the commitment to launch the UK Shared Prosperity Fund after we leave the EU.

“The new fund will seek to reduce inequalities between communities in the UK and promote sustainable, inclusive growth based on the Industrial Strategy, and we will consult on its design in 2018.”