ESF Information Memo 28/21 - Call 3 Match Funding

Dear Project Promoter,

Call 3 Letters of Offer have now issued.

As you will be aware, DfE was able to fund more than 65 per cent of the costs of Year 3 under Call 2. That meant that we did not draw down the £21m from the EC in that year but did mean that more national funding was allocated. This enabled us to administer Call 3 and provide funding for projects in the 22-23 year when ESF would otherwise have ended.

The £21m of EC funding not used in 2020-21 can fund 50 per cent of project costs under the ESF Programme. DfE has managed to secure an additional £6.3m which meets a further 15 per cent of the costs leaving beneficiaries to secure the remaining 35 per cent before commencement on 1 April 2022.

DfE has already advised that there is no additional funding available beyond the 15 per cent awarded to each project. The 2022-23 draft budget is now published and makes clear that no additional funding will be made available to use. It is probable that other Government departments will be similarly constrained.

I appreciate this will cause considerable concern to many of you. Indeed, we are receiving substantial levels of correspondence on this issue and our response will remain consistent.

As we have previously indicated, the UK Government has pledged to provide full replacement for EU Funds that are ending as a consequence of EU Exit. This may therefore represent a potential avenue to secure any gap in match funding for the 2022-23 year and then as the primary source of funding when ESF monies are exhausted.

We are working closely with Department of Finance colleagues and the Department for Levelling Up Housing and Communities on this issue and would suggest that you also consider making contact with them.

In addition, to help me monitor the match funding position, I would appreciate if you could keep me informed of your progress in securing match funding.

If you have any queries regarding this memo please feel free to contact me on 07557057626.

Kind Regards,

[signed]

Annie McGowan
Head of ESF Project Delivery Branch