Spending Review: Wales must receive fair rail funding

Wales’ infrastructure in ‘severe need of investment’ and cannot ‘continue to lose out’ - Plaid Cymru

As the UK Government prepares its Spending Review, Plaid Cymru Treasury spokesperson, Ben Lake MP, has called for the “inconsistent and unfair designation of major rail projects” to be addressed.

Central to this demand is the urgent need to correct the misclassification of HS2, and most recently the East West Project between Oxford and Cambridge – projects that continue to deny Wales billions of pounds in desperately needed investment.

Following reports that funding for Welsh railways could be announced in the Spending Review, Plaid Cymru have reminded Labour that they once agreed with them that over £4 billion was owed to the Welsh Government in rail consequentials through the Barnett formula. 

Mr Lake said that any increase in capital expenditure towards Welsh infrastructure would be “welcome”, but that it was also crucial that the mistreatment of Wales must also be addressed. 

Despite not a single mile of HS2 or the East West Project track running through Wales, and no direct benefit to our rail network, the projects have been wrongly designated by the UK Treasury as "England and Wales" schemes. This accounting fiction has blocked Wales from receiving Barnett consequentials — funding that would otherwise have flowed to the Welsh Government had both project been correctly classed as an England-only project, as is the case for Scotland and Northern Ireland. 

Plaid Cymru is therefore calling for:

• The reclassification of HS2 and the East West Project (Oxford-Cambridge) as England-only infrastructure projects, reflecting the widely recognised injustice towards Wales;
• A minimum of £4 billion in Barnett consequentials to be paid to the Welsh Government, representing the funding Wales should have received had HS2 and the East West Project (Oxford-Cambridge) been correctly classified; 
• A recognition that transport should be a matter for the Welsh Government, ensuring decisions are made in Wales and reflect Welsh priorities, not a continuation of a top-down approach from Westminster. 

Wales currently has some of the lowest per capita rail investment in the UK. Mr Lake said the billions owed could be used to modernise our network, improve connectivity, create high-quality jobs, and stimulate economic growth. 

Ben Lake MP, Plaid Cymru Treasury spokesperson, said:

"Wales’ infrastructure is in severe need of investment, and its rail infrastructure could benefit significantly from enhancement funding. It is little under a year since the Welsh and UK Governments acknowledged that rail infrastructure in Wales has suffered historic underinvestment, and so it is difficult to accept the designation of both HS2 and the East West Rail Project between Oxford and Cambridge as ‘England and Wales’ initiatives.

“Neither project has been designed to deliver benefits to communities in Wales. Their designation as ‘England and Wales’ projects is fundamentally unfair, as it will deprive Wales of consequential funding that could be used to invest in its transport infrastructure. The UK Government has previously designated large rail projects in England, such as Cross Rail in London, as projects benefitting England alone, and if it were to reclassify HS2 and the Oxford to Cambridge projects in the same way, Wales could stand to gain billions in consequential funding.

“Any increase in capital investment in Welsh infrastructure would be welcome, but it is equally important that the inconsistent and unfair designation of major rail projects is addressed so that Wales does not continue to lose out. The Comprehensive Spending Review offers the UK Government an opportunity to put this right.”