- The WG and MHCLG intend to establish Freeports in areas of economic disadvantage with unmet potential. The budget for this is estimated to be roughly £185 million provided by way of tax relief (totalling £135 million) and seed capital funding (totalling £50 million).
- Our key takeaways from the Subsidy Advice Unit (SAU) report are:
- That the use of tax reliefs may be sufficient to satisfy the additionality principle especially when they target new investments in underutilised and economically disadvantaged areas.
- Where seed funding is used, detail should be provided on its allocation, management and monitoring processes to demonstrate proper oversight and governance.
- It should be clear whether beneficiaries are, either currently or in the future, likely to receive similar subsidies.
- Case studies can be a helpful means of demonstrating the relevant evaluating impacts on competition and investment, though any potential issues raised (including for example here the impact on international trade) should be addressed within the report itself.
- Reports should explore whether it is likely and the scale to which displacement from other disadvantage areas may occur, including how this could potentially distort competition in the UK.
Welsh Government (WG) and the Ministry of Housing, Communities and Local Government (MHCLG), Freeports Subsidy Scheme
Posted in Subsidy Advice Report Tracker.