Row over HS2 spending share

Wales' Finance Minister is in a disagreement with the UK Treasury, over whether the Welsh Government was given extra money as a result of spending on the controversial HS2 rail scheme.

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Wales should get share of HS2 funding says Plaid

Plaid Cymru is hoping to use today's debate on the controversial HS2 rail scheme to ensure extra money is given to Wales as a result. Jonathan Edwards MP has tabled amendments to the legislation paving the way for HS2 which will be voted on in the Commons today.

He says his amendment will be 'the last chance to enshrine in law' the principle that the Welsh Government should be receive funding equivalent to 5% of the cost of the project.

Plaid Cymru has fought a three year long campaign to ensure that Wales receives a fair share from HS2. The cost of the network has doubled over the summer to over £40bn according to the Treasury’s own estimates. Independent assessments by the Institute for Economic Affairs put the cost of HS2 at over £80bn. A fair share for Wales therefore would be between £3bn and £4bn.

Historically, Wales has been poorly served by Westminster Governments when it comes to transport infrastructure in our country – receiving less than half of what our population share would dictate. It’s no wonder that our transport systems are so poor.

– Jonathan Edwards MP, Plaid Cymru

Treasury says Wales did get some HS2 money but won't get much more

The Treasury has issued a further statement on the disagreement between Welsh and UK Governments over extra spending as a result of the HS2 rail scheme. Click here to read the background.

The Treasury now agrees that the Welsh Government HAS received a relatively small amount of extra money (£35m) because the Department for Transport's cash for HS2 came too late to change the formula used to decide how much money Wales gets.

But it's made clear the formula will be changed before there's any major spending on HS2 which means that Wales won't get any extra money if the project finally gets the go-ahead. A Treasury source described the dispute as 'overplayed.'

At the Spending Round in June, the Welsh Govt received a capital consequential of £84.5m. This was based on a £2bn increase in the total DfT capital budget. The Barnett formula calculation used the framework set out at the Spending Review in 2010, which set out 73.1% per cent of changes in DfT spending are subject to Barnett consequential for the Welsh Government. The framework is expected to be updated at the next full Spending Review, as is usual practice, and will reflect the latest information on departmental spending.

– Treasury spokesperson


Welsh Government insists it's right in Treasury dispute

A Welsh Government spokesman has further clarified why Finance Minister Jane Hutt is sticking to her guns in a disagreement with the UK Treasury. The dispute is over whether or not Wales has received a share of spending on the controversial HS2 rail scheme.

Jane Hutt has already told ITV Cymru Wales that she stands by her claim as set out in a letter to the Finance Committee. Now a Welsh Government spokesman has underlined her position.

The Finance Minister's letter to the Assembly's Finance Committee is accurate. At the Spending Round in June, the UK Government allocated funding for HS2 in 2015-16 through the UK Department for Transport capital budget. This contributed to an overall increase in the DfT capital budget from £7.5bn to £9.5bn in 2015-16 - a £2bn increase. This increase includes funding for HS2. The Welsh Government received a capital consequential of £84.5m from the £2bn overall increase in the DfT capital budget.

Finance Minister stands by HS2 funding claim

Finance Minister Jane Hutt is standing by her claim that the Treasury has given the Welsh Government extra money as a result of spending on the controversial HS2 rail scheme.

She'd told the Assembly's Finance Committee that £84m was passed on in the recent Spending Review as a result of Department for Transport capital spending including HS2. The Treasury has disputed that claim.

But in this short interview with Lynn Courtney, Jane Hutt insists that the money - known as Barnett Consequentials after the formula used to work out Wales' share of UK Government funds - does reflect Westminster's spending on HS2.

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