Government funding intended for rural businesses and communities will be spent exclusively on business growth in Fenland this year. 

Fenland District Council (FDC) councillors voted through a recommendation to spend the first year’s allocation of the two-year fund, totalling £436,000, on “equipment and premises for smaller businesses” and “diversification of income streams for farmers” at a meeting this week. 

How the second years’ allocation will be spent will be decided in future, a report on the fund presented to councillors says. 

FDC says that there are two reasons for spending the money on business growth in 2023–4 rather than allocating any towards community projects. 

The first is that the allocation is smaller in the first year: £109,000 compared to the £327,000 expected in 2024–5, which can be shared out among more schemes. 

The second is timing: community schemes will take longer to organise and implement, whereas there are more business growth-related schemes ready for funding, council leader Cllr Chris Boden (Conservatives, Whittlesey East and Villages) said at the FDC cabinet meeting. 

“Because of the lateness of the detail of this announcement from Government, it really will be quite difficult for us to spend the money in the current financial year on community matters,” he said.  

“Next year, we’ll have an appropriate division between businesses and communities so that we get an overall fair distribution.” 

Cllr Boden has previously criticised the Government for making budgeting for local authorities “extremely difficult” as funding arrives in “fits and starts”.

Examples of community schemes the money could be spent on include helping local people run their own pubs, village shops, local produce markets and health and social care facilities, the council report says. 

It could also mean improving and widening the use of village halls, improving broadband connectivity and investing in walking and cycling schemes. 

On the business side, the funding could go towards supporting start-ups, helping businesses reach net zero emissions targets, revitalising service centres and supporting artistic and creative endeavours. 

The fund, called the Rural England Prosperity Fund, will be delivered from the Department for Environment, Food & Rural Affairs (Defra) to FDC via the Cambridgeshire and Peterborough Combined Authority (CPCA).

It was launched in September 2022, with the first payments being made in April 2023. 

The money tops up the UK Shared Prosperity Fund for rural communities and succeeds the older Growth Programme and the EU LEADER fund, which was also aimed at developing rural communities.