News / Shetland fears European aid discrimination
SHETLAND could lose out on European regional aid as a result of its low unemployment rate if a new European proposal goes through.
The European Union is consulting on whether to single out Shetland as the only place in the highlands and islands to miss out on the highest rate of financial support from Brussels.
The health of the local economy and the islands’ ability to ride out the recession have seen Shetland ranked alongside Edinburgh and Aberdeen on funding eligibility.
Shetland Islands Council is seeking an urgent meeting with European aid officials to voice their concerns and has embarked on a major lobbying exercise.
Development committee chairman Alastair Cooper has warned that the move could impact on 20 local projects over the six year period the new regulations would cover from 2014 to 2020.
He said that in the past three years alone 11 Shetland projects had received around £400,000 in European funding, creating a total of 45 jobs.
Cooper said that the EU’s decision to measure the wealth of the community by it employment and productivity levels was unfair, saying that high costs and remoteness made it one of the hardest places to establish a competitive business.
Shetland firms could lose out to outside businesses when it came to competing for contracts in the energy and seafood sectors, he warned.
“This is a very worrying change which could threaten future developments in Shetland,” he said. “We need to resist this proposal.”
While agriculture, fisheries and transport would be unaffected by the changes, manufacturing, crafts, textiles, renewable energy, tourism and services would all be hit by the proposals.
Small businesses would see support halve from 40 to 20 per cent of project costs, while medium size firms would go down from 30 to 10 per cent. Large companies would receive nothing at all.
Shetland Composites director Fred Gibson said his manufacturing business would not have been able to construct its new premises at Staney Hill without European funding.
“We have been able to win larger contracts from outside Shetland, and now employ more staff as a result,” he said.
Marine engineering firm Malakoff’s managing director Douglas Stevenson warned the cuts could affect their ability to take advantage of developments in offshore decommissioning, oil and gas, renewables and the seafood industry.
“There are opportunities at the moment which local businesses need to take advantage of, otherwise large businesses from outside Shetland will benefit the most,” he said.
“Significant capital projects are not possible for us without public sector support at a time when the banks are still shy about investing at high levels.”
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