The UK Government has raided the money from the devolved Welsh and Scottish budgets to help pay for military aid for Ukraine. Wales' finance minister Rebecca Evans has attacked the decision, calling it "worrying and potentially divisive".
The UK Government announced on Wednesday night (June 29) it would provide another £1bn of military support to Ukraine. Within the press release that was sent out, it included a note that "this new funding has come from the underspend of departments across the UK Government and £95 million in contributions from the Scottish and Welsh Governments’ budgets – recognising the wide importance of tackling Russian aggression."
It has now emerged that the UK’s Chief Secretary to the Treasury asked Wales and Scotland to either offer up a contribution or to take a reduction in the consequentials provided as part of the block grant from the UK Government. The Welsh Government was left with the choice of contributing funding up front, or being hit with a negative Barnett consequential later in the year. Wales was asked to provide £30m, money which will come from its capital budget and will need to be found from existing spending plans.
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Rebecca Evans, the Welsh Government finance minister said the Welsh Government is determined to support the Ukrainian people and said it has made a "substantial contribution" to the humanitarian effort in Ukraine and through its super sponsor scheme. However she said defence and foreign affairs are reserved matters which should be funded by the UK Government.
She said: "Our spending on humanitarian support for people from Ukraine is above and beyond the funding provided by UK Government. We do not receive consequential funding for our welcome centres or arrival hubs, for example, because these provisions go above and beyond what is available to people from Ukraine arriving in England. I would like to take this opportunity to recognise the immense efforts of local authorities, health boards, the third sector and a wide range of other partners in Wales for their roles in the active provision of this support.
"We will continue to provide humanitarian support to the Ukrainian people, and it is right the UK should continue to provide much-needed military support. However, defence and foreign affairs are reserved matters.
"This is a novel, worrying and potentially divisive approach by the Treasury – seeking to use devolved budgets, that should be for investment in devolved areas, like health and education, to fund reserved spending areas such as military aid and defence. Funding for these areas should rightly be met by the UK Government. Ultimately, because of the exceptional circumstances, we have accepted this situation in light of our ongoing commitment to support Ukraine and the Ukrainian people in their fight against this senseless act of aggression, but it should not be a precedent. This funding has not been provided from Welsh Government underspends but will result in challenging decisions to be made about our limited capital budget."
On Radio Wales Breakfast Education Minister Jeremy Miles said ministers in Cardiff "were told by the UK Treasury the budget would be cut". "There wasn't any consultation," he said.
"Given the exceptional circumstances, we've agreed to this as we want to support the people of Ukraine," he said, adding Rebecca Evans was "looking with UK government ministers at how some of the impact could be mitigated".
He hoped the UK government would agree to an increase in Welsh borrowing borrowing powers, which have not changed for "five or six years".
Ministers in Cardiff, he said, "are keen and do everything we can to be constructive partners with the UK government, in the range of ways in which we need to work together". "That is not always reciprocated. We saw this week, for example, the UK government proposing to repeal laws that the Senedd passed, without even notifying Welsh government".
A UK Government spokesperson said: “To say the Welsh Government was not consulted on this matter is incorrect – they were consulted and agreed to make a contribution. Following discussions last week with the Chief Secretary, the finance ministers in the Welsh and Scottish Governments agreed to make a contribution as part of the funding being provided to maximise the international effort to support Ukraine, following Russia’s unprovoked, illegal invasion.”
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