Future of NI start-ups at serious risk due to loss of EU funding, warns business body

The future of entrepreneurship and start-ups in Northern Ireland is at serious risk if a replacement to EU funding cannot be agreed, according to the body which represents local enterprise.

Enterprise NI has warned that uncertainty over the proposed UK Shared Prosperity Fund risks squeezing start-ups and micro and small businesses out of the market.

The organisation, which supports NI’s entrepreneurs and start-ups and works with over 4,000 businesses every week, has said that local entrepreneurship will be among the hardest hit if future funding is not distributed effectively.

Enterprise NI’s warning comes as Finance Minister Conor Murphy confirmed that the proposed replacement funding will “deliver too little money, risks duplication of provision and lacks alignment to our local priorities.”

The Finance Minister also said in an Assembly Written Answer that the UK Government’s centralised approach to the funding “has crystallised a significant loss of spending power for the Executive.”

The warning also comes as the five main party leaders in NI signed a joint letter to the Levelling Up Secretary Simon Clarke urging the British Government to fully replace all EU funds.

Ahead of the publication of the NI Investment Plan as part of the UK Shared Prosperity Fund at the end of this month, Enterprise NI are calling on the UK Government’s department for levelling up, housing and communities to urgently confirm that funding for local enterprise will not fall by March 2023.

Enterprise NI is planning to bid to the UK Shared Prosperity Fund to resource a newly designed service through the Fund’s ‘Supporting Local Business’ stream.

Michael McQuillan, CE of Enterprise NI, said: “Local economic development across NI faces a cliff edge in March 2023 when EU funding streams come to an end. This deadline is looming and, with just six months to go, we are no clearer to how this vital funding will be replaced or even whether it will provide the same level of funding.

“EU funds were crucial in supporting start-ups and entrepreneurs in NI, helping foster entrepreneurship and enterprise, and delivering billions of pounds in local economic development. It’s therefore deeply concerning to hear the Finance Minister confirm again this week that the planned replacement will not deliver the required level of funding and doesn’t align to NI’s priorities.

“At the absolute least, the British Government must ensure that the Shared Prosperity Fund provides the same level of funding to support pre-starts and start-ups, if not more given the serious hurdles currently facing business owners of all shapes and sizes.

“Enterprise NI has been engaging with elected representatives across the country from all political parties to highlight how our proposed ‘Primary Care Network’ service will ensure local economic development can be delivered in a more joined-up cost effective, impactful way post-March 2023.

"It’s vital that the Department for levelling up, housing and communities recognises the efficiencies that our bid can deliver and ensure that entrepreneurship in NI does not fall off a cliff edge in six months’ time. Without it, start-ups, young entrepreneurs and micro businesses will be squeezed out of the market before they even get off the ground.”