Senedd Election party manifestoes – Finding the money

Professor Stuart Cole, CBE. Emeritus Professor of Transport Economics and Policy, Prifysgol de Cymru / University of South Wales

The Senedd election is nearly upon us and the political parties will now be trying in earnest to attract your vote. They will all have promises on transport which they believe will be popular.

Over the next three months this column will examine those transport options which will benefit Wales, which parties are promising those actions, and how they intend to pay for them.

Funding transport in Wales

The fundamental challenge is funding. Without adequate funding politicians promises are of little value whichever party is in power. The Senedd budget and therefore that of Welsh Government is largely determined by the Barnett formulae-based block grant.

In transport this relates to England’s  expenditure on road construction and maintenance, bus funding and railway service subsidy. Though Wales will get only a fraction of the estimated £401m rail subsidy budget for 2026 / 27.

The argument for infrastructure responsibility and funding to be transferred to Welsh Government has been made for many years. HM Treasury has refused. One could put this down to its bean counters not wanting the additional expenditure which a genuine Barnett consequential will entail. Or one might less kindly say they ‘don’t get Wales’.

This is a complex process as this column has previously explained (26 January 2025). Wales’ funding formulae used to determine the block grant award should be level with that in Scotland and Northern Ireland.

Describing the HS2 railway as bringing benefits to north Wales as an ‘England and Wales’ project lacks credibility. That same ‘England and Wales’ Machiavellian trick is now being applied to the East – West Railway between Oxford and Cambridge. The £6.6bn cost would have generated almost £300m for Wales’ coffers.

To be credible to voters each party manifesto has to show how these objectives will be paid for.

Rail expenditure decision making

Wales’ one-year budget funding allowed by HM Treasury made enhancement schemes such as Valley Lines electrification over seven years a high-risk rather than a normal governmental low-risk investment. Even then the scheme only received twelve per-cent rather than the total costs for similar railway developments in England.

The UK Railways Bill provides new processes for joint working which suggest even more schemes in Wales will be defined as ‘England and Wales’ because Welsh Government will only ’be involved in the High-Level Output Statement discussions which is the five-year basis for rail network funding. Scotland will determine its own HLOS.

Wales’ railway infrastructure funding will continue to be determined by the Secretary of State for Transport in Whitehall. This restricts Welsh Government railway decision-making to TfW train service operation or take the cost risk. Consequently the GBR Cymru business unit proposed by our transport minister will attract no more funding than the present process unless the Whitehall/Cathays Park dialogue changes.

Financial pressure on UK government

This means Wales’ political leadership style must change from the current under-assertive, passive relationship with Westminster. In my mind this has best been  described as ‘not kicking hard enough at the London fence’ by Professor Richard Wyn Jones (Welsh Governance Centre).

In the transport context, the way railway infrastructure funding in Wales is dealt with by the UK Government gives an indication of the lack of priority and understanding of Wales’ transport needs and the consequent inadequate funding.

That there is no reason to suppose London civil servants have changed their view of Wales is shown, inter alia, by their insistence on retaining the Barnett formula based on population levels rather than need.

Of course Welsh Government has not had the upper hand as the funding decision will be made by the UK Department of Transport and HM Treasury. However the future  Welsh Government’s announcements have to stop almost reflecting those of the UK government and reflect Wales’ transport needs.

Great British Railways – benefits for Wales?

Under rail privatisation Wales’ rail operations were split into four units, only one managed in Wales. Our domestic rail franchise results from a decision by the then UK rail minister Dr Kim Howells.

Whitehall civil servants argued for no change. Dr Howells, whom I was pleased to advise, made the correct decision. Domestic train services at least are managed in Wales and under the terms of the Railways Bill will continue to be so (Nation Cymru 30 March 2025).

Ironically the GBR livery is based on the Union flag (Jack) which of course contains no reference to Wales. Is this an omen of its future approach to Wales?

One Network, One Timetable , One Ticket

To deliver an integrated passenger transport policy providing easier travel together with well-being and environmental objectives requires control of all transport expenditure to be within Wales.

This discussion in Wales can be traced to the House of Commons Welsh Affairs Committee ‘Public Transport in Wales’ report (1985) to which this columnist was the adviser.

Over the subsequent forty years  discussions between government ministers, officials, TfW, myself and others led to these  policies taking hold in Cathays Park slowly at first but with increased vigour in more recent years. Despite this trend many transport plans have not been implemented because of insufficient funding from HM Treasury and Whitehall’s Department for Transport (DfT).

A road and rail integrated investment programme using the current economic appraisal process is required. Infrastructure insurance for the rail network, which Whitehall denies is possible, can be achieved through adding railways into the existing trunk-road insurance where the risks of major rebuilding costs are similar.

Testing the manifestos

The evidence to date shows little concern for travellers in Wales from UK government  ministers. The Railways Bill is an indication of this with no additional powers for the Senedd. Direct payments to local bodies should be routed through the Senedd budget and not avoid the devolution settlement

A funding action plan not a promise is what we should be looking for from the manifestos.

The First Minister Eluned Morgan speaking in London last week to the Institute of Government said that Wales should be getting the appropriate funding level. This was not forthcoming under the Blair/Brown Labour governments or  the Thatcher and subsequent Conservative administrations nor so far under Sir Kier Starmer.

Whichever party(ies) wins the election has to challenge UK government ministers and civil servants to provide a new block grant formula based on need. This extends to transferring rail infrastructure responsibility to Welsh Government together with HM Treasury compensatory funding for lack of investment over several decades.