Objective of the Getting Building Fund
The aim of the £900m Getting Building Fund is to deliver jobs, skills and infrastructure across the country, whilst also using public funding to help the economy recover urgently from the impact of the Covid-19 pandemic. As covered in our earlier Article on this subject, the Secretary of State for Housing, Communities and Local Government, Robert Jenrick, wrote to England’s Local Enterprise Partnerships (LEPs) and elected Mayors requesting lists of “shovel ready” projects by Thursday 18 July. These lists were considered by the Ministry and investment allocated towards the parts of England which have faced the greatest economic challenges as a result of the pandemic. A list of the individual allocations is set out below.
Application of State aid law to the Getting Building Fund
EU State aid rules regulate how Public Sector bodies, including local authorities, can use the assets and powers in their disposal to support businesses. Unlawful State aid can result in the European Commission ordering recovery of the State aid from the beneficiary and carries significant reputational issues for Public Bodies.
The allocation of the £900m funding to each LEP (as set out below) will normally be “no aid” to the LEPs themselves. However, subsequent funding to developers or other undertakings and where public bodies such as Councils might use the funding for their own “direct development” projects, then State aid will need to be carefully thought through.
Measures such as open access cycle lanes will normally be considered as general infrastructure and therefore “no aid”. However it is likely that proposals involving the creation of commercial units, support for SMEs, housing, film studios and business parks will need to be designed to meet the terms of one or more block exemptions.
The General Block Exemption Regulation (“GBER”) is the most common route for such awards to achieve compliance and has been utilised for around 96% of State aid awards since 2014. For projects such as this, it is likely that the Regional Investment Aid (Article 14) and Aid for Local Infrastructures (Article 56) exemptions will be of particular interest. However in applying GBER it is important to be aware of the strict compliance requirements and put in place an appropriate audit trail (including an assessment as to how each compliance requirement is met at the time of the award of aid).
Case law such as the German Land Scheme can also provide a route forward for public bodies. Under this decision the GRW was able to undertake certain measures, including remediation and removing buildings on brownfield sites, to revitalise land which were considered to be “no aid”.
Local Enterprise Partnership Allocations of the Getting Building Fund
Area Name |
Region |
Total (£m) |
Tees Valley |
North East |
17.4 |
Cornwall and Isles of Scilly |
South West |
14.3 |
Sheffield City Region |
Yorkshire and The Humber |
33.6 |
North East (includes North East and North of Tyne combined authorities) |
North East |
47.0 |
Greater Lincolnshire |
East Midlands / Yorkshire and The Humber |
25.8 |
Lancashire |
North West |
34.1 |
West Yorkshire |
Yorkshire and The Humber |
52.6 |
Humber |
Yorkshire and The Humber |
13.4 |
West Midlands Combined Authority – working with Black Country LEP, Greater Birmingham and Solihul LEP and Coventry and Warwickshire LEP (for Coventry) |
West Midlands |
66 |
Coventry and Warwickshire (for Warwickshire) |
West Midlands |
8.1 |
Cumbria |
North West |
10.5 |
Stoke-on-Trent and Staffordshire |
West Midlands |
23.7 |
Worcestershire |
West Midlands |
12.0 |
The Marches |
West Midlands |
14.0 |
Heart of the South West |
South West |
35.4 |
Derby, Derbyshire, Nottingham and Nottinghamshire |
East Midlands |
44.4 |
South East |
South East / East of England |
85.0 |
New Anglia |
East of England |
32.1 |
Greater Manchester |
North West |
54.2 |
Leicester and Leicestershire |
East Midlands |
20.0 |
York and North Yorkshire |
Yorkshire and The Humber |
15.4 |
GFirst |
South West |
11.3 |
Cambridgeshire and Peterborough |
East of England |
14.6 |
Liverpool City Region |
North West |
26.0 |
Cheshire and Warrington |
North West |
15.5 |
South East Midlands |
East Midlands / East of England / South East |
27.3 |
Dorset |
South West |
11.8 |
Buckinghamshire |
South East |
7.7 |
Hertfordshire |
East of England |
16.8 |
Swindon and Wiltshire |
South West |
9.7 |
Solent |
South East |
15.9 |
Coast to Capital |
South East |
19.2 |
Oxfordshire |
South East |
8.4 |
West of England |
South West |
13.7 |
Enterprise M3 |
South East |
13.3 |
Thames Valley Berkshire |
South East |
7.5 |
London |
London |
22.1 |
Conclusion
The Getting Building Fund provides very important and significant public investment in infrastructure at a time of the greatest economic turbulence.The fund will need to be carefully administered by the Local Enterprise Partnerships in order to avoid State aid difficulties, especially important as these organisations will want to show they are a “safe pair of hands” whilst decisions are being made about the delivery of the UK Shared Prosperity Fund.
DWF Law LLP has a breadth of expertise in State aid law matters. We are able to draw upon a team of leading experts who have extensive experience in this area, including working within the UK Government on high profile funding matters, defending projects from recovery and designing projects to meet the rules.