Concern Wales could miss out on rail investment despite promise of 'significant' funding

Emily Price 

Concerns have been raised that Wales could be set to lose out on rail infrastructure investment despite the First Minister insisting that the UK Government had promised "significant" funding.

Eluned Morgan said last week that for the first time ever, the UK Government was recognising that Wales had been shortchanged on HS2 funding and other railway projects.

Speaking on a BBC phone-in, she said: "They classified it as an England and Wales project even though not one inch of track was laid in Wales. That for me is a fundamental injustice.

"We've had a letter from Heidi Alexander saying, ‘ok, something isn’t right here’. Now there is a discussion about what we are going to do about it, ‘where are your projects so we can invest’."

The FM said that the funding was likely to come in the form of new stations and rail infrastructure, but did not specify where.

Asked how much funding Wales was going to get she said she hopes "it’s going to be significant".

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Freeze

But a senior industry executive later told The Times that Chancellor Rachel Reeves is set to announce a "spending freeze" to shunt any major new railway projects until after the next General Election.

The news outlet reported that three rail projects all partway through completion were "set to soak up the Department for Transport funding allocation" for the next ten years.

The projects are the first phase of HS2, an upgrade to TransPennine infrastructure and a new East West Rail project in England.

The Welsh Government pointed out to us that The Times source was anonymous.

Plaid Cymru says that if the Chancellor restricts new rail investment to these three major projects, it is difficult to see how improvements to transport infrastructure in Wales will be funded.

We asked the Welsh Government whether new rail investment funding for Wales would be pushed back until after the next General Election - when Labour might not even be in power.

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'Partnership'

The Welsh Government said that Baroness Morgan didn't actually announce any new funding from the UK Government during the phone-in.

A spokesperson said: "The First Minister did not announce new funding for rail last week but confirmed that for the first time the UK Government had acknowledged that Wales was underfunded and we are now working in partnership with the UK Government to shape a brighter future for rail in Wales.

"This includes developing and agreeing a number of investment priorities in rail infrastructure across Wales to improve services for rail passengers. We are doing this as part of the Wales Rail Board and the plans will be considered as part of the UK Government Spending Review."

'Direction'

Last week, Welsh Secretary Jo Stevens told the Welsh Affairs Committee that the Welsh Government and ministers in Westminster had "agreed a direction of travel" which she hoped would "deliver new rail investment for Wales".

Three key points had underpinned these discussions, she said: recognition that Wales had not received a fair share of funding, that Government commissioned investigations into rail had provided a "really good blueprint" for which investments to prioritise, and that the UK and Welsh Government needed to work together on the matter.

Ms Stevens added: "I want to be very clear that we cannot fix this overnight. It has gone on for a long time, and the legacy of under investment is going to take time to resolve, but I am clear, both Governments are clear, that we have got to break this cycle of underinvestment that had been a political strategy."

We made the Welsh Secretary aware of reports that the UK Government could be set to mothball new rail investment and asked what that would mean for Wales.

'Position'

A Wales Office spokesperson pointed us to the letter mentioned by Eluned Morgan during the phone-in which was sent by Heidi Alexander and Jo Stevens to Wales' Transport Secretary Ken Skates last week.

The letter stated: "The Chancellor has been clear on the position of the public finances
bequeathed by the last government which must be addressed as a matter of urgency.

"She has been equally clear on the need to fix the foundations of the economy by unlocking critical infrastructure.

"The prioritisation of rail service improvement projects proposed by the Wales Rail Board, and described in this exchange of letters, will therefore inform both Departments’ work with HM Treasury in the run up to the Spring Spending
Review.

"In the meantime, we remain committed to the investments underway at present and are keen to see improvements to Cardiff Central station and the construction of the Metro link to the Bay delivered as soon as possible.

"We will be delighted to support a joint visit at a suitable opportunity to see directly the benefits being delivered through the joint work of our two governments."

'Explain'

Plaid Cymru says the UK Government must "urgently explain" how Wales will receive its fair share of rail investment during this Parliament.

Treasury spokesperson, Ben Lake MP said: "It is concerning to read that the Chancellor might be considering a freeze on new major rail projects, and such reports will exacerbate fears that Wales will yet again lose out on important infrastructure investment.

"Reports that UK Government funding will be concentrated on HS2, TransPennine upgrades and a new East West Rail project in England come barely a week since the UK Government acknowledged that Wales has been underfunded when it comes to railway infrastructure enhancements.

"If the Chancellor restricts new rail investment to these major projects for the remainder of this Parliament, it is difficult to see how the much-needed improvement to transport infrastructure in Wales will be funded.

"When in opposition the Labour Party was in favour of reclassifying HS2 as an England-only project, which would at least ensure that Wales receives a significant uplift in funding from the project that could be invested to improve our transport infrastructure.

"It does not appear that the Labour Party in Government is of the same opinion and is content for HS2 to be classified as an ‘England-and-Wales’ project. This means that Wales stands to lose around £4 billion in funding, and so the UK Government must urgently explain how it will ensure Wales receives its fair share of rail investment during this Parliament."