Businesses in Argyll and Bute could lose vital support as the UK Shared Prosperity Fund (UKSPF) faces a funding gap, despite an independent evaluation finding that the programme helped drive business growth and employment across the region.
Argyll and Bute Council is stepping up engagement with the UK and Scottish governments after an evaluation warned of the potential impact of losing future funding. Following a final transition-year allocation of £1.417 million for 2025/26, no replacement funding has been identified through UK government successor programmes for the next three financial years.
The council’s policy and resources committee has agreed to press for continued investment in rural and island communities, highlighting the role of the fund in supporting businesses, developing skills and strengthening local economies.
An independent evaluation by EKOS Ltd found that the programme delivered significant social and economic benefits between 2022 and 2025, supporting community-led projects, business growth, employability programmes and workforce development.
Businesses supported through the fund during 2025/26 reported a 29 per cent increase in turnover and a 38 per cent increase in full-time equivalent employment after receiving assistance. During the programme’s first phase, 165 businesses received support.
The evaluation concluded that the council successfully delivered its UKSPF programme despite challenging timescales, exceeding many planned outputs. However, it warned that the loss of future funding could disproportionately affect rural, remote rural and island communities, where delivering services and creating economic opportunities can be more challenging.
Councillor Jim Lynch, policy lead for economic development at Argyll and Bute Council, said the investment had helped local businesses, families and communities while creating opportunities for residents to develop skills and access employment.
“Our communities have shown what can be achieved when investment is targeted towards local priorities,” he said. “We want to build on that success and continue creating opportunities for residents, businesses and communities to thrive.”
The council will continue working with both governments and partners, including the Convention of Scottish Local Authorities where appropriate, to make the case for sustained investment that reflects the needs of rural and island areas.
Beyond business support, the evaluation highlighted the fund’s wider contribution to the local economy and household finances. More than 4,500 families received support through the Flexible Food and Fuel Fund, while households experiencing hardship benefited from more than £6m in financial gains.
The programme also supported training, employment and graduate apprenticeship opportunities for young people, alongside projects aimed at strengthening communities and encouraging local economic development.
The council said future funding programmes should offer longer-term certainty and greater local flexibility, with funding arrangements tailored to the challenges faced by rural and island communities.
The UKSPF was a central part of the UK government’s Levelling Up agenda, providing £2.6 billion for local investment across the UK between April 2022 and March 2025. Funding was allocated to areas through a formula rather than a competitive bidding process.