Spending curbs 'cost councils EC cash': Local authorities miss out on pounds 500m

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(First Edition)

SPENDING restrictions are depriving local authorities of EC subsidies worth millions of pounds, a senior EC official warned yesterday.

Bruce Millan, Commissioner for Regional Policy, said that pounds 500m earmarked for UK projects had not yet been committed. The money must be taken up in 1993 because the EC's multi-annual spending period, under which the allocations have been made, ends this year.

Under EC rules, the Government must match the EC funds before they can be disbursed. Mr Millan told a meeting of the Wales TUC that a delay in implementing this 'additionality agreement' was partly to blame. But he added that another significant reason was that 'the restrictions put on local authority spending have made it so much more difficult for councils to co-finance projects'.

Mr Millan ran up against the British government last year when he complained that he was unable to release EC money available under the Rechar programme to revive former mining regions, because he was not satisfied that the Government would pass those funds on to the authorities for whom they were intended. That row has now been resolved.

No amount of Community initiatives could improve the prospects for the EC's 17 million officially unemployed people, Mr Millan said, until governments 'show a real commitment to co-ordinating their economic policies with the same common aim - namely growth'.

Central government is, meanwhile, still at odds with the regional authorities over the question of the 24 appointees to the Committee of the Regions, set up under the Maastricht treaty.

It is up to member states to appoint representatives to the advice body. The British government initially suggested they should be senior civil servants and other non-elected officials but that was hotly contested.

An EC official said yesterday: 'The Government will have to decide soon, because in the British way of things it could take some time to make the appointments and the Committee is supposed to be up and running as soon as Maastricht is ratified.'