Confusion remains over how post-Brexit aid money for Wales will be managed
Martin Shipton
Confusion surrounds the circumstances under which Chancellor Rachel Reeves delivered a Spending Review that contradicted a personal pledge made by the Prime Minister to First Minister Eluned Morgan.
As we reported earlier this week, a previously little noticed section in the Spending Review stated that the latest round of post-Brexit regional aid funding for Wales would be administered by the UK Government’s Ministry of Housing, Communities and Local Government in conjunction with the Wales Office, headed by Secretary of State for Wales Jo Stevens.
There is no mention in the Spending Review of the Welsh Government having an involvement.
However, Keir Starmer had previously promised that the schemes would be managed by the Welsh Government – as regional aid programmes had been run when the UK was an EU member state.
The Welsh Government complained bitterly when the former Tory UK government decided to bypass it and hand out money directly to local authorities in Wales.
The issue took a strange turn on Wednesday June 18 when Blaenau Gwent Labour MS Alun Davies raised it with the First Minister at a Senedd committee when she was scrutinised in her capacity as the minister responsible for international affairs.
‘Categorical assurance’
After Mr Davies expressed his disappointment that Keir Starmer had apparently broken his promise, Baroness Morgan said: “Well, just to make it clear that I am not accepting that what was put in that report means … The way it’s been interpreted is … So, I’ve had a categorical assurance from the Secretary of State for Wales that this will be decided and managed by the Welsh Government.
“This was a commitment by the Prime Minister on the stage of the Labour Party conference and I have made it absolutely clear that we will be holding their feet to the fire on this. So, you know, I’m actually more confident that we’re going to get to the place that I want to be, because I have been given those reassurances. It was something I made clear in a meeting as well in front of the Chief Secretary to the Treasury last week as well.”
Later that day, in the afternoon, the Cabinet Secretary for Housing and Local Government Jayne Bryant responded differently to a question about the matter in plenary from Plaid Cymru MS Peredur Owen Griffiths, stating:
She said: “The UK Government has confirmed that Wales will receive around £630m over three years and, over the coming weeks, we’ll be discussing the detail of this funding with the UK Government, with a view to working with Welsh partners, including local authorities, to develop a new Welsh programme from April 2026, where we’ll be working with the UK Government to put arrangements in place to ensure that the Welsh Government can take decisions about how its funding is used to support our economic ambitions and bring prosperity to all parts of Wales.”
Topical question
Later, in a Topical Question, Plaid Cymru’s economy spokesperson Luke Fletcher asked: “What assessment has the Welsh Government made of the impact on Wales of the UK Government’s decision that post-Brexit regional funding in Wales will be administered by the Ministry of Housing, Communities and Local Government rather than by the Welsh Government?
“I noted what the Cabinet Secretary for Housing and Local Government said in response to a question from Peredur Owen Griffiths during an earlier session, and I noted as well the evidence given by the First Minister this morning to the culture committee: both have seemingly created a very confused picture.
“Now, let’s remind ourselves of the timeline here. Ahead of the UK general election, Keir Starmer pledged to restore decision-making powers over the levelling-up and shared prosperity funding to the Welsh Government. Then, during the election, this pledge was revised down to giving the Welsh Government an unspecified role in determining how this funding is spent, rather than devolving it in full, and now we’re told, through the Spending Review, that power over post-Brexit funds will be retained in full at Westminster, administered by the Ministry of Housing, Communities and Local Government, with input not from the Welsh Government—and let’s be clear on this—but from the Wales Office.
“The messaging is all over the shop. On the one hand, the Spending Review says one thing, and on the other, the First Minister this morning was suggesting that what the Spending Review set out will not be the case. So, quite simply, what’s going on? What’s the government’s position? And who are we to believe—the Chancellor’s Spending Review or the First Minister?
‘Common outcomes’
Counsel General Julie James replied: “Exactly similar to the EU structural funds model, we are keen to agree a set of common outcomes with the UK Government against which we can develop a tailor-made Welsh approach with our partners, which fits with devolved policy and the governance and structures existing in Wales. “I can give you an example of that. We want to take a more integrated approach to be able to look at priorities such as skills innovation and connectivity alongside regeneration-type activity, but the balance should be for us to agree with our Welsh partners. And we’ve begun work, I’m delighted to say, with those partners, including via our regional investment in Wales steering group, chaired by Carolyn Thomas MS.
“The group has already considered lessons and international best practice on how we can support our regional and local economies and labour markets, and we’ve completed a range of work with the Organisation for Economic Co-operation and Development, or the OECD as it’s commonly known, on how international best practice can be applied in Wales to achieve maximum impact from investment in this policy area.
“So I would say that I think it’s really, really obvious that Wales has a major say in these funds, that the funds are very welcome, that we are very pleased to have secured such a large amount of the funding.”
Alun Davies then intervened to say: “The First Minister actually answered a question in Culture Committee this morning. She was very clear that Wales would be running these programmes. She was very clear that the commitments made by the UK Government last week in the Spending Review, which did breach the Labour manifesto, but not only breached the Labour manifesto, but broke a promise made by Keir Starmer in Wales at a Welsh Labour conference, and we have to be absolutely clear on that, and no amount of explanations cut that. Now it appears that, following an intervention from the First Minister, Wales will be running these matters, run by the Welsh Government, and I think all of us, wherever we sit in the Chamber this afternoon, want to hear a Minister saying that, and saying that clearly, because this has been a damaging few days for this government and the UK Government.”
Ms James said: “I’m happy to confirm that my understanding, as well as the First Minister’s, is that the funds will be administered by the Welsh Government in Wales, following the commitment of Sir Keir Starmer that that would be the case. I wasn’t part of the discussion myself, but my understanding is that the First Minister and the Wales Office are in agreement that that is the way they’ll be administered.”
‘Categorical assurances’
Later, the Welsh Government issued a statement to Nation.Cymru that said: “We have had categorical assurances from the Prime Minister and the Secretary of State for Wales that decision-making of these funds will return to the Welsh Government.
“This is a vital investment in our economy, and we will now work with the UK Government on the practicalities of taking back control of this funding.”
Luke Fletcher MS said: “It is clear that communication between the Welsh and UK Labour Governments has completely broken down, and we are therefore in the dark as to whether, when and to what extent post-Brexit funding for local and regional development will be devolved to Wales. So much for the ‘partnership in power’.
“I have written to the Counsel General and Minister for Delivery today, asking for the clarity she failed to give me yesterday.
“Plaid Cymru is clear that this funding should be devolved to Wales in full, so that we can make the strategic decisions about where and how it is allocated, in a way that serves the needs of our people and communities.”
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The title of the picture, ‘Hanging On For Grim Death’
I suspect when Eluned Morgan gets up in the morning she has to phone Jo Stevens to find out what new dictat the UK government is sending down the M4. She’s not the First Minister just a Viceroy. A kind of Governor General, employed in the dominions to carry out the wishes of Kier Starmer’s inner circle.
There’s losing an election, and then there’s throwing it away
Whitehall’s post-EU economic plan for Wales is loosely based on a Victorian workhouse.
Wouldn’t be having this issue if we had remained.
Yet again, discussing something which is of virtually of zero interest to the general public, and also no discussion about what the money should be used for and what the outcomes should be. And you wonder why Reform are ahead in all the polls?!
Don’t forget. Nigel Farage is responsible for Wales losing hundreds of millions in EU Structural funding. His actions also aided Whitehall’s Senedd power grab. He is the cause and we feel the ill affect. Those aforementioned regions haven’t qualified three times for EU funds because Labour and Tories took the problem seriously. No. It’s due to their merely managing poverty rather than eradicating it. Those former red wall mining communities in the North & South of Wales still suffer poverty today because Whitehall neglected our infrastructure. Remember responsibility for large infrastructure projects lies with Whitehall not Wales. If we, Wales,… Read more »
I don’t think you get my point
You are absolutely correct. In 1999, EU funding was described as a “once in a generation” opportunity; but largely squandered – in sharp contrast to the Irish experience. If Welsh Labour had adopted a thoughtful approach, we might not need handouts a quarter of a century later. Blaming Farage, the UK government and the weather is too convenient. We should look closer to home.
The first tranches of EU funding were hijacked by boomers to improve things that mattered to their retirement, such as flower pots for high streets and nice heritage attractions to visit. It improved in later years when we got new roads and metros, stuff to actually build an economy on.
I accept that there were some decent projects in later years; but overall the programme was not transformative for Wales. No one else can be blamed for that except those who made the decisions in Cardiff Bay.
Communities First was handy for a number of people, youth club projects and those who needed help. Trouble was those up the pole saw it as for them to hijack things bought for the community for their own purposes. I and another would go like the bailiff to retrieve them. The ‘overheads’ ie staff wages paid well. As for ‘Works of Art’ £20 grand here £20 grand there, Christmas came early for the Bow Ties…
Where was Whitehall? Only the UK failed to level up its deprived regions with EU support. If the programme was successful in other EU member states, and was unsuccessful in all UK eligible regions (not just those in Wales) then there’s only one legacy imperial government to point a finger at.
You are still blaming the UK government! Structural Funds were administered by WEFO (part of Welsh Government) as the managing authority recognised by the European Commission. There are plenty of reasons to point the finger at the imperial government as you call it; but this ain’t one of them.
Have you considered the possibility that Whitehall did less because the EU was doing it instead? Structural funding is supposed to support and top-up existing central government efforts, not replace it. That’s why the UK didn’t see the same success in any of its deprived regions (Cornwall is still in a terrible state, so it can’t be a Wales problem) that other member states saw. If Whitehall was reducing its own efforts, that cash saved could be spent on London which means in effect the EU structural funds were hijacked by the richest region in Europe.
Possibly. There was a match funding requirement; but you could say exactly the same about the Welsh Government. I think you are rather stretching an argument to fit with an anti-Westminster position.
It’s important to understand why the UK didn’t see the same improvements that other deprived areas in the EU enjoyed. This is necessary to avoid repeating the same mistakes. If the root of the problem was in SW1 then letting SW1 take charge now isn’t smart. Unless you want to continue seeing negligible improvement, of course. As many people do. That’s the whole point of the conservative movement, for example. Keeping things the same. Because a stronger economy in Wales, and the other UK nations and regions outside of London, would signal the final nail in the British empire coffin… Read more »
It’s direct rule through the back door. UK Labour are a party of Anti-Welsh centrists who have taken patronising the Wales to a new level. Lame donkey FM Eluned Morgan has zero influence over her English Whitehall overseers. She’s achieved absolutely nothing for Wales since UK Labour came to power last May, but defend the indefensible and hold out the begging bowl for scraps. We in Wales have an opportunity next Senedd election to not only to oust failing Welsh Labour after 26 years in power, but more importantly send a message to arrogant Cymrophobe UK Labour that no more… Read more »
They have done it in voting for the assisted dying bill expressly stopping Senedd on vetoing bill if they had wanted to.
‘Leadbeater saw off attempts to limit the scope of bill in Scotland, Wales and Northern Ireland, and there is now also less chance that a future Welsh government can veto the whole bill coming into force in Wales, amendment 94 limits the scope of control the Senedd can have’.
Regardless of views on subject this is another pushback on Wales controlling its affairs.
Sorry Y Cymro, to denigrate a loyal overworked neglected beast of burden forced into lameness is in no way any comparison to Princess Morgan, a life of ease, self-righteousness, entitlement and adoration but no achievement that I’ve seen since Drakeford and Gething’ brought her back after their lost weekend in London getting their cards marked…where’s hd hope he’s alright…
Meant for Y Cymro sorry Howie…oops!
Confused.com aka the Senedd!