A Welsh Government cabinet minister has attacked the UK Government's decision to categorise a second major English rail project as also benefiting Wales, so there will be no funding for the Welsh Government.
Mick Antoniw MS said in the Senedd said it is "complete nonsense" to suggest Northern Powerhouse Rail and HS2 benefit Wales enough to deny a potential billions in Barnett funding. Mr Antoniw, the Welsh Government's counsel general, said the decisions were an "abuse" of the Barnett formula.
Rail spending is not devolved to Wales so the nation does not get a guaranteed share of any spending in England, and is dependent on arguing for funding from Network Rail. To address this, previous major rail projects like Crossrail have been classed as England-only so Wales gets a share of the funds. However for HS2, UK Government ministers have repeatedly insisted it is an 'England and Wales' project despite none of its track being in England.
The Treasury has since confirmed it is also classing Northern Powerhouse Rail as 'England and Wales,' meaning Wales will miss out on a likely further £1bn. When asked about the advice he had given the Welsh Government over these decisions, Mr Antoniw said: "The UK Government should not fund the Northern Powerhouse Rail in the same way as HS2. Northern Powerhouse Rail should be classified as an England-only project, with Wales receiving a population share of this funding."
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Jack Sargeant, Alyn and Deeside's Labour MS accused the Westminster governing of having "short-changed Cymru" of money that could have "revolutionised Wales' rail network." Instead, he said, it was "simply another example of how the Conservative Partyy in Westminster have no interest in Wales."
He asked the counsel general whether he agreed that "there is one solution for the people of Wales to get what they are owed: a general election and a Keir Starmer, UK Labour-led Government" - even though Keir Starmer himself refused to commit to Wales getting its share of HS2 funding if he became Prime Minister.
Mr Antoniw replied: "To suggest that these English projects benefit Wales is a complete nonsense. The money would be transformational for Wales's transport network. The UK Government needs to do the right thing and to pay up. I believe what we actually have is an abuse of the Barnett formula. I can say that these issues are raised at every opportunity and through the current inter-governmental machinery, and Welsh Government is not leaving it there where it is at the moment."
He was pushed further on this by Plaid Cymru's Delyth Jewell MS, who said the Tories sought to "deny geographic reality" with their decisions. She asked: "Do you agree with me, Counsel General, that we should move to a place where the Barnett formula or, far better, a fairer replacement formula should be enshrined in law so that we no longer have to simply rely on some 'good chaps' principle of hoping that Westminster will do what's right in terms of funding, because, as this episode and countless others have shown us, Westminster does not do what is right for Wales?"
The Barnett Formula is used to calculate the annual change in the "block grant" given to Wales, Scotland and Northern Ireland, based on changes to the budgets of UK Government departments. Where a project by the UK Government results in an increase in funding for a department, Wales is given a proportionate share based on the population and the extent to which the policy area is devolved.
Mr Antoniw stopped short of calling for a total abolition of Barnett in principle, saying: "Barnett, for all its faults, is a redistributive formula, and we don't want to do away with a redistributive formula." But he added: "We just want a fairer formula and one that has clear guidelines and rules as to how it should operate. It cannot be something that is subject to the political whims of a particular Government at any particular time."
He concluded that Ms Jewell was "absolutely right that there is a need for a newer formula, a refreshed formula, and a formula that has clear constitutional status in the way it is operated and the way in which any disputes over the operation of that formula should operate."
A UK Government spokesperson said: "The UK Government is responsible for heavy rail infrastructure across England and Wales, so spends money on this in Wales directly rather than funding the Welsh Government to do so. This is consistent with the funding arrangements for all other policy areas reserved in Wales and not devolved.
"The UK Government’s existing rail investment in Wales includes upgrading the signalling on the Cambrian Line, developing upgrades for Cardiff Central Station, re-opening Bow Street Station, and the electrification of the Severn Tunnel.”
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