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Wales facing a return to ‘austerity’ unless lost EU funds are replaced, Economy Minister warns

31 Jul 2021 2 minutes Read
Vaughan Gething. Picture by the Welsh Government.

A failure to replace lost EU economic funds could see austerity measures return to Wales, Vaughan Gething has warned.

The Minister for Economy says that while Wales has lost £375 million a year in EU economic aid, the UK Government has yet to confirm plans on what replaces it.

He said that unless the shortfall is addressed, the Welsh Government would have to ‘balance budgets’ and make the kinds of decisions taken when ‘austerity was at its height’.

In an interview with the Financial Times, he says: “The chancellor said there won’t be a return to austerity.

“Actually, if money disappears . . . you could find yourselves having to make choices that look very similar to the choices I was having to make as a minister when austerity was at its height.”

Shortfall

The EU structural funds ended in December 2020 but the UK Government has pledged to replace the shortfalls in Wales, Scotland and Northern Ireland.

Westminster plans to create a Shared Prosperity Fund (SPF) with around £1.5 billion made available annually but there are no details on exactly how this will work.

In the meantime, a Community Renewal Fund provides £220m in funds but this covers all of the UK nations with Wales expecting to receive only around £10m.

UK Government Chancellor Rishi Sunak rejected claims that spending cuts were a return to austerity during an interview in November 2020, saying, “there’s absolutely no way in which anyone can say that’s austerity, we’re spending more money on public services than we were.”

Wales, Scotland and Northern Ireland have complained that the SPF plans by the UK Government bypass the devolved administrations.

First Minister Mark Drakeford has described them as an “enormous power grab” which would, “do more to hasten the break-up of the Union than anything else since devolution began.”

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William Glyn THOMAS
William Glyn THOMAS
1 month ago

Since the EU referendum it has become abundantly clear that some members of the electorate are not as well informed as they could or should be. This often leads to misunderstandings and arguments. Persons with opposing opinions are unable to convince their opponents that their opinion is the most valid one. This sometimes leads to verbal abuse or in rare circumstances a physical assault. The younger generation seem to be more able to understand politics and in my view there needs to be a concerted effort to improve the knowledge of people of my generation and their offspring, (I was… Read more »

Mab Meirion
Mab Meirion
1 month ago

That was the magic of Coleg Harlech…bring it back Mr Gething, it was a side door into Aberystwyth University, one I’m told they miss…

GW Atkinson
GW Atkinson
1 month ago

When are the Welsh government going to finally wake up to the fact that being strangulated by the English government doesn’t benefit Wales? They need to grow up and take responsibility for their weakness.

#1Chris
#1Chris
1 month ago

They’re not lost. We know who has them. But they’re playing politics with them

Steve Duggan
Steve Duggan
1 month ago

Receiving the exact money lost by leaving the EU was never on the cards, we’ve all known that from the beginning. Why were we given EU funding? Because the UK government has neglected us for years – that is hardly going to change now is it ! Forget Westminster – let’s make our own prosperity, let’s make a better country for ourselves !

Kerry Davies
Kerry Davies
1 month ago
Reply to  Steve Duggan

“Boris Johnson has said he would guarantee the cash Wales gets from the EU would still be spent in Wales ….”
That was what he promised when campaigning in Wales in 2019. He may well have been telling a porkie.

Mab Meirion
Mab Meirion
1 month ago
Reply to  Kerry Davies

That was before Mr Drakeford called him awful…

Steve Duggan
Steve Duggan
1 month ago
Reply to  Kerry Davies

Do you honestly believe what Johnson states? (I don’t think you do!) He’s an opportunist he’ll say anything and probably sell his grandmother too in order to garner votes, get elected and further his career. We will ‘not’ get anywhere near the money we used to get from the EU. Time to move on, time to get out.

#1Chris
#1Chris
1 month ago
Reply to  Steve Duggan

Was it not? Then perhaps the Tories should not have made that exact explicit promise during the referendum campaign and the 2019 GE.

Steve Duggan
Steve Duggan
1 month ago
Reply to  #1Chris

You don’t say !!

William Habib Steele
William Habib Steele
1 month ago

The problem is that we are part of the UK. A parliament of 530+ English MPs, their number soon to be increased, and40 Welsh MPs, their number soon to be reduced, can only be England centred. Welsh taxes are sent to pay for the undemocratic House of Lords, English vanity projects such as HS2 and weapons of mass destruction. and the monarchy. It’s time for Wales to become independent!

David Russell
David Russell
1 month ago

EU money? It was never EU money. It was our money paid to Brussels and we were given a small amount back to keep us in line. Ultimately we saw through the scam and got out.

Paul Davies
Paul Davies
1 month ago

Can’t the Senedd look at the areas in Wales that supported Brexit and apply cuts to those areas
Why should the areas of Wales that voted to stay in the EU have to suffer the consequences

Wrexhamian
Wrexhamian
1 month ago
Reply to  Paul Davies

Wouldn’t that play right into Johnson’s hands? He’d love a Wales that was at odds with itself.

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