IWA: Shared Prosperity Fund is ‘a deliberate retrenchment of devolution to Wales’
An independent think tank has described the UK Government’s Shared Prosperity Fund as a “deliberate retrenchment of devolution to Wales”.
UK Government ministers announced details of the programme which is meant to replace EU support following Brexit last week, claiming communities in Wales had been “handed control of £585 million” to level up.
Under the previous EU aid system, the Welsh government administered the cash in agreement with the European Commission.
Under the new scheme, local authorities will be encouraged to work together on regional committees to decide how the money will be used – with the Welsh Government effectively bypassed on spending decisions.
Lack of respect
In a response to the publication of details of the new programme, a report from the Institute of Welsh Affairs, while welcoming some developments, said: “We are disappointed at the lack of respect given to devolved institutions in Wales. The prospectus very clearly seeks to elevate the role of MPs above that of MSs or even the Welsh Government.
“This is an area that was formerly held at a Wales level but that has been taken back without consent to a Westminster level.
“It deliberately cuts out any formal role for the Welsh Government or MSs.
“The new system also requires local authorities to work to UK Government priorities and to gain the sign-off of UK Government Ministers for local schemes.
“The prospectus also calls for the Secretary of State for Wales to be involved in plans, but not the Welsh Government. One is elected by the people of Wales, and one is not.
“On funding: it is clear now that Wales will lose out on funding. In addition to this, the way the funding formula has been put together would appear to move money out of the most deprived areas in comparison to the former funding regime.
“This means that the overall pot of money for Wales appears to be smaller, with this reduced pot of funding being directed away from the most deprived areas. This means that areas most in need of funding could stand to lose significant amounts.
“A deprived area in Wales will now have less funding and require sign-off from Westminster politicians to use it.
The IWA’s Economic Policy Lead Harry Thompson said: “This is ultimately a disappointing scheme that will not ‘level up’ Wales. The promise to Welsh voters of ‘not a penny less’ than EU funding has been broken, and the remaining funding has been partially diverted away from the most deprived areas in Wales.
“Large parts of the UKSPF are designed not on sound economic development principles but rather based on the political desire to cut the Welsh Government and Senedd out of decision-making, returning the final say to Westminster – be that MPs, the UK Government, or the Secretary of State for Wales. This is a deliberate retrenchment of devolution to Wales.
“If local authorities can nominate their respective CJC as their ‘lead authority’, and the Welsh Government can convene a coordinating body for local authorities to coordinate spending via their CJC, some progress can be made.
This would allow a forum for economic development priorities at a local, regional, and national level to be discussed and coordinated.”
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