INTRODUCTION

The European Structural Funds provide grants to support projects to promote social and economic regeneration and competitiveness.  The funds operate throughout the UK although most of the funding is concentrated on areas of greatest need – so-called Objective 1 and 2 areas. The funds support infrastructure projects, existing and new businesses, research and development, training, job creation and rural and environmental development.

Match Funding                                                                                        
Match Funding The European Structural Funds meet only a proportion of the cost of any project. The precise proportion that the Funds will contribute to a particular project depends on several factors, including the type of activity and where it takes place.  Typically the funds can meet 40% - 50% of costs and more in Objective 1 areas, though lower rates apply to certain types of activity.  The rest of the cost of a project has to be funded from national sources, which can be either public or private sector – this is called match funding.  This booklet is a guide to the public sector programmes, initiatives and funds that can be used as match funding for the European Structural Funds in England.  It is not an exhaustive list as such schemes may change from time to time. 

Different arrangements may apply in other parts of the UK.  Further information on funds available in Northern Ireland, Scotland and Wales is available from the relevant devolved administrations (see Annex 2 for contact details).

In order to be eligible for support, a project must meet the criteria of both the Single Programming Document (the national or regional strategy for using the European Structural Funds) and the public sector scheme being used for match funding. 

NB. National funding must be secured before application for European match funding can be considered.  The voluntary and private sector may make contributions (including contributions in kind – e.g. paid staff, volunteers, transport or accommodation), and organisations such as the European Investment Bank can make loans.

Identifying appropriate match funding is the responsibility of the grant applicant. However, the European Secretariats in the regional Government Offices can provide the initial links between the programme partnership and potential sources of public match funding.

Further Information                                                                               
Further information on funding in a particular English region and on how to apply is available through Government Offices and Regional Development Agencies (see Annex 2  for contact details).  General enquiries about the Structural Funds should be directed either to the Government Offices, or to Steve Nead at the Department of Trade and Industry, Tel: 020 7215 6283, Fax: 020 7215 2520, e-mail : steve.nead@dti.gsi.gov.uk

BUSINESS SUPPORT

Small Business Service (SBS)

The Small Business Service is a Next Step Agency of the DTI.   It was set up with the purpose of building an enterprise society in which all small businesses thrive and achieve their potential.

The aims of the SBS are to:

• minimise the burden of regulation on Small and Medium sized Enterprises (SMEs);
• promote world class business support services to enhance the performance of SMEs;
• promote enterprise across society and particularly in under-represented and disadvantaged groups; and
• achieve the highest standards of service delivery and providing value for money

In meeting these aims the SBS works closely with others in Government, with people in the private and voluntary sectors and with the people who deliver their services, to ensure that they “think small first”.  In this way the SBS acts as a voice for small business at the heart of Government.  The forty-five new SBS franchises (Business Links) around England will be the local face of business support.  The SBS enquiry line is 020 7215 5363 and further information is available at www.businessadviceonline.org.

Most of the Small Business Service budget that is delivered locally is available for match funding.  This includes the following: High-growth Start-ups; the Phoenix Fund; Smart; the Enterprise Fund; the UK High Technology Fund; and Regional Venture Capital Funds – which are covered in the Business Support section of this document. Also: Faraday Partnerships; and TCS – which are covered in the Higher Education – links to business section of this document.

SBS: Core funding

The Small Business Service contributes towards the cost of providing a range of key business support services to small and medium enterprises.  These services include the provision of information and advice, counselling, a diagnostic service, subsidised consultancy support, business skills training, and a range of innovative products and services.  Services are delivered primarily by Personal Business Advisers (PBAs), with specialist counselling services available for innovation and technology, design and exporting.

Funding for the delivery of business support services is allocated by SBS who contract directly with Business Links.  Funding for the current year amounts to £130 million.

SBS: High-growth Start-ups (HGSUS) programme

The HGSUs programme originated from a commitment made in the Competitiveness White Paper published in December 1998, to improve the help given to start-up businesses by providing a new high-quality advice service targeting 10,000 growth start-ups a year in England (by the end of 2001).  Up to £20 million is being made available over three years to 2001 for the provision of support services to help ensure that a greater proportion of start-up businesses with the potential actually go on to achieve real growth.  The programme is being delivered through the Business Link network. 

SBS: Phoenix Fund

The national Phoenix Fund, worth £30 million over three years, exists to encourage entrepreneurship in disadvantaged areas where entrepreneurs face difficulties in launching their ideas because of lack of support, advice and access to finance.  The Phoenix Fund helps these businesses by providing additional finance for innovative approaches to community finance.

Applications can be made from both new and existing Community Development Finance Institutions (CDFI).  These tend to be locally run, non-profit organisations that lend smaller amounts to businesses which banks consider too risky for reasons such as lack of business experience or bad credit ratings.  The fund also provides help for other innovative ways of supporting enterprise in deprived areas, such as business incubator units and loan guarantee support.

SBS: Smart

Smart is the Small Business Service’s package of support to help individuals and SMEs in England to review their use of technology, to access technology, and to research and develop technologically innovative products and processes.  The following help is available:

• Technology reviews help individuals and SMEs assess their use of technology against best practice in their sector;
• Technology studies help individuals and SMEs identify technology opportunities which may lead to innovative products and processes;
• Micro projects help individuals and very small enterprises (fewer than 10 employees) develop simple prototypes of innovative products and processes;
• Feasibility studies help individuals and small businesses (fewer than 50 employees) assess the technological and commercial prospects for turning innovative technology into new products and processes;
• Development projects help SMEs develop, to a pre-production prototype stage, new products or processes involving a significant technological advance.

Government Offices for the Regions handle feasibility studies and development projects.  The Small Business Service’s Investment Directorate handles the other elements.  However, potential applicants should contact their local Business Link in the first instance.

SBS: Small and Medium Enterprises (SMEs) loan and equity finance

The Enterprise Fund is a £180 million fund designed to provide loan and equity finance for SMEs.  The key elements of the Enterprise Fund are an ongoing commitment to the well-established Small Firms Loan Guarantee Scheme, the UK High Technology Fund and Regional Venture Capital Funds.  The Small Firms Loan Guarantee Scheme is a scheme where SMEs can apply for loan funding through the banks, with the Government standing as guarantor for the loan.

The UK High Technology Fund has begun to invest in venture capital funds specialising in the provision of equity for early-stage high-technology SMEs.  The Government has invested £20 million in the UK High Technology Fund alongside a further £106 million from corporate investors and the European Investment Bank.  All investment decisions are being made by the Commercial Funds Manager. 

At least one Regional Venture Capital Fund is being established in each of the English regions (alternative arrangements are in place for Scotland, Wales and Northern Ireland under devolved authorities).  The Government will invest alongside other investors to create a venture capital fund that will contribute towards SMEs capable of and aiming towards growth.  As with the UK High Technology Fund, a professional Fund Manager will make investment decisions, on a commercial basis.

Sustainable Technologies Initiative (STI)

The Sustainable Technologies Initiative (STI) provides £18m of government funding over five years for collaborative projects to improve the sustainability of UK business.  In order to achieve substantial improvements in the efficiency of material resource use, it seeks

• novel technologies
• simplified assessment tools for industrial sustainability
• better uptake of sustainable design, production and consumption
• innovative use of existing technologies

These should address all three aspects of sustainable development: the economic, the environmental and the social.  Key themes of the programme will be:

• developing criteria for business sustainability
• the sustainable use of raw materials
• improved resource-efficient processes and equipment
• reduced hazardous material content of products
• new products and processes which enhance social inclusion
• production of less waste and pollution
• new product/service concepts for sustainability
• associated socio-economic and management research

There are other government initiatives aimed specifically at recycling, renewable energy, land remediation, transport and agriculture; STI aims to complement not replicate these.

COMMUNITY INVOLVEMENT

Active Community Unit (ACU)

The Active Community Unit promotes an inclusive society in which people are actively involved in their communities.  It works towards achieving a healthy voluntary sector, able to work effectively in partnership with Government.  It is committed to working with voluntary and community organisations, business, the public sector and the media to achieve these aims.

The Unit provides grants that support: new initiatives for developing and championing active communities; and strategic support for umbrella bodies, in the voluntary and community sector, whose primary purpose contributes to one or more of the following:

•         increasing voluntary and community involvement
•         supporting the development of active communities

The National Lottery

The National Lottery currently generates funds for six ‘good causes’: the arts, sport, heritage, charities, projects to mark the new millennium and the New Opportunities Fund.   The National Lottery website address is www.lotterygoodcauses.org.uk

Awards for All

Awards for All is a lottery funding programme aimed at local groups. It awards grants of between £500 and £5,000 in a quick and straightforward way.  Grants support sports, arts, education, heritage, environment, health and community activities.

Each year Awards for All support more than 12,000 groups with nearly £40 million.  Since the programme was first piloted in September 1998, Awards for All has made a total of 28,000 grants totalling nearly £100 million. The average grant is £3,500.

Community Fund

The Community Fund gives grants to groups, which help those at greatest disadvantage and to improve the quality of life in the community.  The Community Fund has run grants programmes focussed on poverty; youth and low income; health, disability and care; education; the environment; voluntary sector development; medical and social research.  Current grant programmes are the Main Grants Programme and projects up to £60, 000.  These programmes run concurrently and there is no closing date.

Further information is available from the Community Fund website: www.community-fund.org.uk.  Alternatively, contact the following regional offices.

New Opportunities Fund (NOF) – Health, Education and Environment Projects

The New Opportunities Fund (NOF) is a Lottery Distributor created to distribute grants to health, education and environmental projects across the UK.

By working in partnership with other organisations, including other Lottery Distributors, the New Opportunities Fund intends to support sustainable projects that will:

• Improve the quality of life for people throughout the UK,
• Address the needs of those who are most disadvantaged in society,
• Encourage community participation,
• Complement relevant local and national strategies and programmes.

NOF will be working with national, regional and local partners from the public, private and voluntary sectors to fund initiatives, fairly and efficiently.  Particular attention will be paid to those who are most disadvantaged in society.  NOF is committed to providing equality of opportunity.

Community Chests

Community Chests will provide small-scale grants to local groups to support community self-help and mutual support activity, focussing especially on hard to reach groups (including ethnic minority groups), as a first step towards more involvement in the neighbourhood renewal process.  The programme channels substantial new resources (£50 million over the next three years) through the lead organisations in communities within the 88 areas eligible for the Neighbourhood Renewal Fund.

Community Empowerment Fund

It is a requirement for Local Strategic Partnerships (LSPs) to engage effectively with local community and voluntary sector groups.  Although LSPs will be expected to not only welcome such support, but to actively seek it out, the Government believes it will help communities and the voluntary sector to participate fully if they have resources of their own specifically for this purpose.

The Community Empowerment Fund (totalling £36million over the next three years) will support community and voluntary sector involvement in LSPs in the 88 areas eligible for the Neighbourhood Renewal Fund.  It can be used to fund activities such as residents’ meetings and surveys to gather views and feedback what happens on the LSP, outreach to residents and hard-to-reach groups, and training and support to community representatives on LSPs.  The funding will be administered through the Government Offices for the regions.

New Deal for Communities (NDC)

The New Deal for Communities was launched in 1998 and supports the intensive regeneration of some of our poorest neighbourhoods. The programme supports regeneration schemes that tackle such issues as poor job prospects, high levels of crime, educational underachievement and poor health.

There are 39 NDC partnerships, which bring together local residents, voluntary organisations, public agencies, local authorities and business. The partnerships have developed regeneration strategies for their areas, and each Partnership has funding of approximately £50m over 10 years.  Each Partnership covers a neighbourhood of about 4,000 households. 

The challenge is for NDC is to:

• Try to ensure that local services better meet the needs and expectations of residents and local businesses
• Support communities so that they can get involved in, and take greater control over the issues that directly affect them.
• Bring together evidence about what works and communicate this to others

Neighbourhood Management Programme

The aim of Neighbourhood Management is to help deprived communities and local service providers to work together at the neighbourhood level to improve and ‘join up’ local services.  The aim is also to help make those services more responsive to local needs and ensure they deliver priority outcomes on the ground.

The Government’s Neighbourhood Renewal Action Plan commits £45m for at least two rounds of neighbourhood management pathfinders over the next three years.  The first bidding round was launched in January 2001, inviting 83 eligible areas to produce expressions of interest to take part in the programmes.  The closing dates for bids were 20 April.  20 neighbourhoods were selected to take part in this first pathfinder round in July 2001.  They are currently working on their delivery plans which will be finalised in 2002.  There will be an announcement for the second round shortly

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