MERSEY regeneration projects have been given a clean bill of health in a Euro-audit that detected £190m of “irregularities” in other struggling British regions.
Taxpayers face a £190m hit after the European Commission (EC) revealed it would snatch back grants earmarked for projects from the Scottish Highlands to South Wales because of tendering errors and faulty documentation.
But the audit – the most forensic ever carried out in Brussels – has cleared all the billions of pounds of regeneration spending in Merseyside since 1994. The verdict will be greeted with sighs of relief after the Daily Post revealed the blunders that wiped out £522,000 of grants The Mersey Partnership (TMP) was expecting from the EC.
After the TMP’s paperwork was found to be faulty, the organisation – which funnels money into key industries – was left on the brink of insolvency and had to be bailed out by the North West Development Agency.
However, that clawback is not included in the EC’s list of rejected grants published yesterday because the mistakes were uncovered by the Government Office North-West, before Brussels became involved.
Elsewhere in Britain, the largest sum will be snatched back from the North-East (£79.3m), followed by Northern Ireland (£53m), Greater Manchester (£31.5m), the Scottish Highlands (£13.3m) and South Wales (£12m).
The Government is likely to shoulder the burden, but it is possible that council taxpayers will be forced to pay up where local councils were the driving force behind projects.
The EC was quick to insist that “irregularities” did not mean fraud – but the Conservatives condemned what they called a “financial scandal”.
European Regional Development funds are crucial to Merseyside which, as one of the poorest regions in western Europe – has received billions to attract businesses and create badly-needed jobs.
The EC provides up to 50% of cash for projects, with the rest pumped in by national and local government and private investment. The £135m Kings Dock development is receiving £45m from Brussels.
Last year, the Commission launched a high-profile “action plan” to tighten up scrutiny of spending both in Brussels and by member states.
The crackdown has already led to £680m being clawed back from regeneration schemes across the EU this year, with the further £190m to be seized from British projects in the next few months.
EC officials insisted the £190m was not a “fine”, but a “financial correction action”, with the projects themselves almost certainly unaffected.
