Welsh Labour MPs slammed after voting down amendment to devolve Crown Estate to Wales

Welsh Labour MPs have been accused of putting ‘party before country’ after voting down an amendment to the Crown Estate Bill which would have brought Welsh powers over natural resources in line with Scotland.

This is in direct contradiction to Welsh Labour Government policy.

The amendment, tabled by Plaid Cymru’s Energy spokesperson, Llinos Medi MP, called on the UK Treasury to transfer the management of the Crown Estate to the Welsh Government within two years after the commencement of the Act.

Currently any profits generated from the Crown Estate’s assets in Wales, valued at £853 million in 2023, flow directly to the UK Treasury rather than staying in Wales to be reinvested in Welsh communities.

In 2024 alone, Scotland’s Crown Estate generated record profits of £113.2 million which were reinvested by the Scottish Government into Scottish communities.

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Benefits

Treasury minister James Murray said the Crown Estate Bill will ensure the creation of “long-term prosperity for the nation”, before MPs passed the legislation at third reading.

Plaid Cymru’s Westminster leader Liz Saville Roberts said the UK Government believes Wales is “too small and too poor”.

Mr Murray responded by suggesting there is greater benefit to Wales in retaining the Crown Estate’s current form and devolving it would “further fragment the UK energy market”.

The Crown Estate is an independent company that belongs to the monarch for the duration of their reign. The value of its land and assets is an estimated £15.5 billion.

The revenue from its property portfolio flows directly to the Treasury, but 25% of the annual profits go to pay for the monarch’s official duties. The estate also owns the UK seabed up to 12 nautical miles out to sea and has jurisdiction over new offshore wind farms.

Ms Medi argued “the people of Wales should own and benefit from their own natural resources” as she tabled the amendment to the Bill.

The Ynys Mon MP argued that “millions of pounds generated on the Welsh Crown Estate is being taken out of Wales each year”, adding: “Why do the Scottish people get the benefits from their own water, wind and sea resources but the people of Wales can’t?”

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'Too complex'

Shadow Treasury minister James Wild questioned if Ms Medi had the support of businesses, and argued devolving the estate would be “too complex” for “licensing reasons”.

Mr Murray said: “The Government believes there is greater benefit for the people of Wales and the wider United Kingdom in retaining the Crown Estate’s current form.

“The new clause would most likely require the creation of a new entity to take on the management of the Crown Estate in Wales, which, by definition, would not benefit from the Crown Estate’s current substantial capability, capital and systems abilities.

“It would further fragment the UK energy market by adding an additional entity, and as a consequence, it would risk damaging international investor confidence in UK renewables.”

New clauses

He added: “We’re not historically analysing what may have happened in Scotland. We’re looking at the proposal put forward to us in terms of the new clauses I’m currently addressing.”

Ms Saville Roberts (Dwyfor Meirionnydd) intervened later to say: “The minister has just told the House that Wales is too small and too poor to benefit from the devolution of the Crown Estate. That is an extraordinary argument, and I’m sure the Welsh Government will share my amazement.”

Mr Murray replied: “If we were to have a devolved entity it would be starting from scratch midway through a multimillion-pound commercial tendering process, just at a time when the Crown Estate is undertaking critical investment in the UK’s path toward net zero, something I am sure she would be keen to support.”

Ms Medi’s amendment was defeated, with 59 voting in favour, 316 against, majority 257.

Speaking after the debate, she said: “Today provided Welsh Labour MPs with a real opportunity to put country before party by voting in favour of my amendment to ensure that wealth generated in Wales is kept in our communities to benefit our people. It is deeply disappointing that they failed to stand up for the interests of the people of Wales.

“This is particularly puzzling given that the Welsh Labour Government has repeatedly voiced support for transferring powers over natural resources to Wales. We are yet to see the benefits of the so-called ‘partnership in power’ between the UK Labour Government and the Welsh Labour Government, particularly when they continue to undermine each other on such key issues. A real ‘partnership in power’ would prioritise the people of Wales.

“The Government stated that the devolution of the Crown Estate to Wales was ‘too costly’. I would argue that Wales simply cannot afford to miss out any longer on the millions of pounds that are taken away from our communities every year. Our communities are crying out for real investment, and this is another missed opportunity by Labour to have the meaningful change that they promised to the people of Wales.”

'Outrageous'

Welsh Liberal Democrat Westminster Spokesperson David Chadwick said: “If Crown Estate profits were kept in Wales, it could contribute an additional £50 million to the Welsh Government’s budget. That’s more money for our public services, economic investment and infrastructure in our communities.

“At a time when public services in Wales are crumbling after 26 years of Labour rule, it is nothing short of outrageous that the Labour Government in Westminster seeks to deny Wales vital sources of income.

“The Labour Government’s refusal to devolve powers further entrenches the outrageous notion by Labour and the Conservatives that Wales is a lesser nation than Scotland.

“Instead of empowering Welsh communities to harness the benefits of their own resources, profits will continue to flow directly to London.

“This is not the vision of growth that will benefit local communities or level up left behind communities. It is a continuation of the Conservatives' failed economic model that prioritizes centralization and investment in the Southeast of England over everything else.

“The Liberal Democrats have long supported devolution and empowering local communities, and we will continue to campaign against this injustice.”