Motion NDM8326 Heledd Fychan
To propose that the Senedd:
1. Notes that:
a) the Crown Estate, at a UK level, recorded a net revenue profit of £442.6m in the financial year 2022-23; and
b) the value of the Crown Estate’s assets in Wales has increased considerably in recent years, reaching £603m at the end of the financial year 2021.
2. Believes that Wales’s net-zero goals could be realised more effectively if it had full control over its resources.
3. Calls for the devolution of powers over the management of the Crown Estate and its assets in Wales.
Diolch, Dirprwy Lywydd. Wales is a nation rich in potential and no more so than in our natural resources—the tides and wind, the energy that's inherent in our land and waters. But so much of those riches are at a remove from us. They do not benefit the people who live in our country, but are instead used indirectly to line the coffers of the King, to add yet more wealth to Treasury funds miles away in London. As figures last week show us, that wealth has increased to record net revenue profits of nearly £433 million UK-wide. The value of the Crown Estate's assets in Wales are known to have reached more than £600 million by the end of 2021—these vast amounts of wealth that are locked away.
The Dick Whittington story talks about how London streets are meant to be paved with gold. In the story, the character finds the pavements are grey and grimy, but that idea seems now to be more than a metaphor, because all that is gold does not have to glitter or sparkle in the sunlight; sometimes, its shine can be obscured, hidden in vaults beneath the pavements. The riches that come from the land beneath our feet, from our land, are taken out of the sun, extracted from under our noses without our even seeing it happen.
In the days of coal, that black gold ripped from the earth underfoot, we'd at least see the wagons of coal going down the Valleys and disappearing to the docks, but now, we don't even see that wealth as it leaves us. Because this story of our land being used to enrich others whilst we remain in poverty is a familiar refrain for Wales. It is the story of every town and village of our Valleys that are now called 'post-industrial', defined despairingly by what we were, by what was taken from us, not by what we can become. And that is what this debate is about, too—about offering another chance for our communities to benefit at last from the land that is ours, and a land that belongs to our future.
The old saying goes that we do not inherit the earth from our ancestors, we borrow it from our children—an inheritance that links our past with what is to come, if it is allowed to become.
As Gerallt Lloyd Owen mentioned in his poem 'Etifeddiaeth',
'We were given a country to care for, / a piece of land as proof / that we insisted on existence.'
A piece of land that is testament to our efforts, our determination, our hopes and our ambitions.
This land can never be looked on coldly. We cannot only see it through the prism of hectares or habitats, as vital as those metrics are. But the land to Wales is also our heritage. As R.S. Thomas, that poet of the land and Iago Prytherch, said:
'This is his world, the hedge defines / The mind’s limits; only the sky / Is boundless'— though—
'His gaze is deep in the dark soil'.
Our inheritance, from the industrial south to parts of rural Wales and all the land that's in between, this is our asset, our witness to our history, to our survival, and you cannot look on it coldly.
With that context, let's look at some of those metrics: 65 per cent of our foreshore and tidal river bed, the majority of our territorial waters, over 50,000 acres of common land, including mineral deposits—all of that is legally classified as being hereditary possessions of the British monarch in perpetuity. The wealth represented by those resources is profound. As I’ve said already, they were valued at over £600 million in 2020-21. But the cruellest element of this constitutional nonsense, whereby not a penny of those profits stays in Wales, is how it limits our potential, closing off the possibility of accruing another kind of wealth—a green wealth, which should be within our grasp, but is instead kept tantalisingly out of our reach.
The Crown Estate’s own research has shown that the Celtic sea could accommodate an additional 20 GW of floating offshore wind capacity by 2045, which could bring £20 billion of direct capital investment to our domestic market. But following that, a global export market could open up, worth £500 billion by 2050. I’ve remarked on it before in this Chamber, Llywydd, because we need to keep grounded in the debate—it is a debate about the ground, after all. The first £1 million cheque in the history of the world was signed in Cardiff docks and not a penny of those profits was spent in the Valleys where the miners toiled and died from the dust that it left them with. All that black gold turned to dust.
And now here we are, talking about the potential for hundreds of billions of pounds, but it may as well be as dust to us, because as it stands, it’s up to the UK Government and the Crown Estate to ensure that Wales benefits from that expansion in technology by encouraging developers to use companies based in Wales—local supply chains that have already been excluded from the benefit of conventional offshore wind, as major fabrication and installation works have been undertaken overseas. Out of sight, out of mind—just like the proceeds from that cheque that left these shores the moment that it cleared.
With a Crown Estate devolved to Wales, yes, it would provide the potential for thousands of jobs; yes, it would allow us to help our communities. But it would also provide us with an opportunity to enrich future generations by using the revenue from these assets to establish a wealth fund for Wales inspired by similar funds in Norway, but built with the profits of renewables and not oil—gold that is not encased in the soot and dust of our yesterday, nor smeared in the oil that clogs our today; a gold that will not pave the streets of another land in riches, but a gold that’ll be invested in our shared tomorrow. A type of gold that does glitter and sparkle with the promise of hope. Because I come back again to this idea, Llywydd, that the space we inhabit, the land over which we are custodians for our future’s sake, is essentially kept locked away from us.
It’s sobering to think that, were we to attempt to harness the potential of that land without the say-so of Westminster or the Crown, we would be trespassing—an outlaw in our own land, transgressing a law that represents neither nature nor common sense, an invisible line that plots and traces these miles, these acres, and puts them under the jurisdiction of another land, defying geography and genealogy. We would be trespassing. But against whom is the greater trespass, the greater sin, when the bill will be paid by generations yet to be born, and when the debt we accrue on their behalf is growing every day?
I talked earlier about Dick Whittington and the pavements lined with gold. I've talked about the black gold of the miners that turned to dust in their throats. There is another allusion I'd make in closing, another reference to golden riches underfoot, with perhaps a moral lesson. In 'He wishes for the Cloths of Heaven', Yeats talks about gold and silver, about how he would wish to spread beneath the feet of the person he loves the vastness of worldly riches. He says,
'But I, being poor, have only my dreams', and so he spreads those dreams under her feet, imploring her to tread softly upon them. We perhaps find ourselves as Yeats; being poor, we have only the dream of benefiting from such a wealth beneath our feet, only the dream of such a future. We tread the cloths not of heaven, but of earth; the earth that is ours, the earth that belongs to our future. We should not have to dream of those riches being passed to them.
Tonight is a chance for us to lay claim to what is ours, to say, as Scotland, that the proceeds from our own resources should be used for the benefit of the people of Wales, now and in perpetuity. It is a richness greater than any gold, and it should be invested in our tomorrow.
Amendment 1—Darren Millar
Delete points 2 and 3 and replace with:
Welcomes the positive contribution of the Crown Estate towards tackling the climate emergency and increasing renewable energy production via the establishment of a world-leading offshore renewables sector.
Calls upon the Welsh Government to engage with the Crown Estate and other stakeholders to achieve its net-zero goals and deliver:
a hydrogen strategy for Wales;
a Welsh national marine development plan;
a national blue carbon recovery plan for Wales; and
support for small scale hydro projects.
Diolch, Llywydd. Thank you, Delyth, for opening that. That was such beautiful poetry, but I cannot agree with a lot of what you have said. We've actually used a lot of Plenary time talking about the devolution of the Crown Estate. Llywydd, can I just make it clear here that our Prime Minister of the United Kingdom, the Rt Hon Rishi Sunak MP, has made it clear that there will be no further devolution of power for Wales? As Rishi has said, people do not want more constitutional reform and 'constitutional tinkering'.
Plaid Cymru, as a party, it's fair to say, you've become rather obsessed now with devolving more powers, and in this instance the Crown Estate. This latest debate forms part of a series of their calls for control. Now, what this Parliament has to ask, again, is: are these calls for reform reasonable? Absolutely not. The first half of the motion only tells us part of the story. The net revenue profit has been generated for the nation's finances. The increase primarily reflects option fee income from the signing of agreements for leases for six offshore windfarms through the round 4 leasing programme and revenue resilience in its other lines of business. Over the last 10 years, the Crown Estate has contributed £3.2 billion for the benefit of the nation's finances through the active management of a portfolio that has doubled in value to nearly £16 billion.
My colleague Siân Gwenllian knows that the Welsh Government couldn’t manage the Parc Bryn Cegin business park effectively, so why would you call for the Welsh Government to have even more control on this? Rhun ap Iorwerth knows that the Welsh Government couldn't manage the Menai bridge effectively, so why would you be calling for them to have more control? And Llyr Gruffydd, my North Wales regional Member, knows that the Welsh Government couldn't manage Betsi Cadwaladr—
No, not yet. If I have time, definitely. If I have time, I will.
We've heard an earlier debate on things that are going wrong in the care system for our children. So, why would you really want the Welsh Government to have more control? Thanks to the fact that the Crown Estate are here, you know, sort of in control in Wales, and the United Kingdom, we have a wind sector that is now going to be leading the world. The Crown Estate has adapted its approach to focus on delivering up to 4 GW of floating wind capacity in four project sites. That work alone will provide enough clean renewable energy to power around 4 million homes. So, Wales is going to be at the forefront of the project, with the Celtic sea being the first phase of development. So, rather than trying to undermine Wales, they're playing a leading role in a global renewable market.
The UK Government is contributing towards that success: £160 million of new funding announced in April for pilot projects to build the port infrastructure needed to support further floating offshore wind. In comparison, the Welsh Government cut funding to clean energy in the 2023-24 first supplementary budget. So, I ask Plaid Cymru, 'Why again would you be calling for the Welsh Government to have this control—a Welsh Government that is currently failing to deliver a hydrogen strategy for Wales?'
Now, the UK Government has developed a strategy that sets out how a Conservative Government will drive progress to deliver 5 GW production by 2030. Scotland has a hydrogen action plan. Yet, in Wales, we are reliant on a pathway that is only informing activities that will take place until 2025.
Rather than wasting time on constitutional change, let's all work together on focusing and progressing green innovation. We should all be aspiring to have a hydrogen neighbourhood trial delivered, and as soon as possible. The creation of incentives for hydrogen taxi fleets could be here in Wales, and work with Ireland on a project to have hydrogen ferries sailing between Irish and Welsh ports is not out of the question. Rather than wasting cash on constitutional change, we should be investing time in developing frameworks that help Wales to achieve our own net-zero goals.
The Senedd has previously supported our calls, actually, for a Welsh national marine spatial development plan. Yet, where is it? There's a failure there to deliver. The Senedd recently heard me outline the huge potential of blue carbon. And I know it's something that my colleague Joyce Watson has raised here many times. Yet, you have not invested in a national blue carbon recovery plan for Wales.
Okay, thanks. I would just say to Plaid Cymru, 'Stop wasting Senedd time by drowning on—droning on, actually—about more devolution; let's make use of the powers that we already have, and let's make Wales very successful.' Currently, it is our view that the Crown estates are in better hands within the UK Government. Diolch yn fawr.
The status of the Crown Estate in Wales is characteristic of how uneven and unequal the constitutional foundations of the United Kingdom are, which, without exception in my opinion, have left us with nothing but crumbs from Westminster's table. And as with justice, as with policing and water resources, there is no logical basis for the Crown Estate to be devolved in one nation of the UK and not here in Wales.
We just need to look at Scotland, where the Crown Estate has been devolved since 2018, for examples of the clear advantages of further devolution to Wales. The recent accounts of the Crown Estate in Scotland show that £15.7 million has been generated for the Scottish Government directly in 2021-22, but that paves the way for £25.5 billion of investment in the blue economy programme in Scotland in floating wind energy. The ScotWind project is a central part of this programme, and it raised almost £700 million for public finances in Scotland in 2022. Either Janet Finch-Saunders thinks that Scotland deserves these powers in a way that Wales doesn't, and that Scotland somehow can deal with these powers better than us, or she's asking for these powers to be withdrawn from Scotland, and I don't know whether the Conservatives would want to make a comment on that. And what the Member for Aberconwy needs to realise is that having control over this gives Government, of whatever stripe, a focus on how to maximise the benefits of these powers.
Now, there are so many skills and resources that we have here that we need to maximise our potential. I'm thinking of Bangor University's research vessel, the Prince Madog, which has its home in the school of ocean sciences in Menai Bridge—a ship that carries every kind of technology that you could imagine, to map the sea bed around the coastline of Wales, and all of the economic and ecological benefits that would emanate from that. But we do have to ensure that these resources are used well and are funded fully, and I ask again today for the Government to invest in the ship and to commission the work that we need to do. So, we are ready to go as a nation; we have the skills and the resources that we need, but what we need are the powers to maximise our use of those resources.
I'm pleased that Labour Members support our proposal today and that will send a cross-party message—from two, or maybe three parties, if not everyone—and that is a robust message from the Senedd. But, with Wales being treated in such a marginalised way by the British state, unfortunately, that in itself won't be enough. If Labour will be in Downing Street after the next general election, we can't wait for them in that place to give us these powers. The Welsh Government will have to demonstrate that it is serious about this, by forcing this onto the agenda of their Labour masters, and to do so with haste. That's why we would appreciate it greatly if the Minister would outline today the ways in which the Welsh Government has engaged with the Labour leadership to date on devolving the Crown Estate in Wales.
We've become accustomed, haven't we, over the past few years, unfortunately, to Keir Starmer being virtually silent on what he has to offer for Wales, but this is another one of those times when that's not good enough and when we need some urgency, as Delyth emphasised in opening the debate. And as my colleague Ben Lake recently alluded to in the House of Commons, there's real urgency, for example, in the need to accelerate the development of offshore wind. We need it because of our energy needs right now, because, clearly, of our climate needs, and for economic opportunities too. But without the powers to directly influence the pace and the development of this vital green energy sector in Wales, we risk losing out to more nimble and empowered competitors, but of course, more importantly, we risk failing to hit our net-zero goals.
We are used to contempt from the UK Conservative Government, I'm afraid, but Wales deserves better than this silent treatment from Keir Starmer too. And, for the sake of our communities, we need whoever is in Downing Street to wake up to why we need the Crown Estate devolved without delay.
A very interesting debate—thank you very much, Plaid Cymru—and very interesting to read the annual report of the Crown Estate. A little bit of history here: obviously, the Crown, under George III, decided to hand over these lands to Parliament and, in exchange, get a guaranteed income from the state. I don't know who got the best deal out of it, but we are where we are. But it's unclear to me, from reading the annual report, exactly what the relationship is between the Crown and the income that the Crown Estate generates, and whether there's any link any longer.
According to Fortune magazine, the Crown gets 15 per cent of the income from the Crown Estate. I don't know whether that's accurate—that's from Fortune magazine—because I simply don't know that. But it's intriguing that it may still have that umbilical link. I also read that Charles had said he didn't want the income from these new windfarms that are mentioned as probably the most significant activity of the last financial year—I think it's 8 GW of renewable energy, which will be sufficient to power 7 million homes. So, this is a big deal in terms of our attempts to become carbon neutral, and certainly a bigger deal than anything the UK Government is doing. I mean, the idea that this is run by the UK Government, Janet Finch-Saunders, is simply untrue. It isn't; it's independently run by other people. So, that intrigues me, and it's not clear for me, so if anybody can clarify that, that would be really great. But I think it's interesting that Charles is saying that the income from this renewable energy should be spent on helping people with the cost-of-living crisis—that he doesn't want any of it, that that's how it should be spent. And once again, I don't know whether there are any powers that the Crown still possess to say what the income should be used on. These are interesting constitutional issues, and they're not irrelevant to what Plaid is proposing in this motion.
I can see that the coalition Government that lasted until after the Brexit referendum passed this Act in Scotland, which came into effect in 2017. I can see that that encourages you to think that we're suddenly going to get a similar deal if we have a change of Government in London. We're certainly not going to get anything at all from the UK Government we currently have, because they're not even giving us what the Barnett formula ought to be giving us. So, that's not going to happen in any which way. But I absolutely agree with Delyth Jewell that we cannot allow what happened to Wales with our coal industry, where we got none of the profits and all of the disbenefit from the pneumoconiosis and the slag heaps, which the Welsh Government with its utterly depleted budget is still nevertheless having to apply resources to make safe—the coal heaps that may be risking communities as a result of the changes in our climate. That is just utterly deplorable.
What I do want to see is an engagement and a negotiation with the Crown Estate. Because at the moment, they are the only reasonable game in town, seeing as with the UK Government it's like falling on deaf ears, isn't it? So, I want to see that Wales will benefit from our natural resources, so that particularly our coastal communities, with the offshore developments that can come from the Crown Estate, will actually go on to benefit communities living around those coastal areas, both in terms of job opportunities and also for ensuring that local businesses have a fair crack of the whip of any procurement options. I'm happy to take an intervention.
Thank you for giving way. I wonder if you agree with me that it's not just about making sure that Wales gets a fair share of profits that are made from our natural resources, but the devolution of the Crown Estate would encourage us to create more benefit in the first place, and keep all of that here in Wales.
Well, that's a possibility, but I'm not sure that that's going to happen. So, what we have to ensure is that our regulations around things like the Social Partnership and Public Procurement (Wales) Act 2023 are applied to the activities that take place in Wales. That should ensure that we will get a fair share of the businesses that will be required to build these offshore wind arrays.
I disagree completely with the Tory amendment. We absolutely will ensure that we will become a sector-leading offshore renewable sector, because we have the wind and we have the depth of the ocean, the wealth of the ocean, that will enable us to ensure that much wealth is created, for the benefit of the people of Wales. And as Delyth reminds us, we are only borrowing the resources of the world from our children, and we have to ensure that we don't despoil them and create even more problems for them to sort out in the future.
So, a very interesting debate. I think that the Welsh Government has a difficult task on their hands, but we absolutely have to ensure we don't have a repeat of history with the coal industry.
I want to talk about what the Crown Estate symbolises, and perhaps answer some of the questions that Jenny raised about the relationship of the Crown with the Crown Estate. The fact that such vast swathes of our nation's resources are held as the permanent personal possession of an individual, given that position and wealth by an archaic bloodline, while thousands of our fellow citizens struggle to afford daily essentials, is testament I think to the deep-rooted class inequalities that pervade our society. The Crown, we are repeatedly told, is a symbol of unity—we hear that about the UK as well as a state—a view that is only possible if the British state's history of colonial and class exploitation is ignored, a patently ridiculous claim that unity can be fostered and promoted by a system that represents the exclusive pinnacle of wealth and privilege, completely closed to all who don't share a certain genetic pedigree.
It's also worth bearing in mind that while the British monarch does not profit directly from the Crown's assets in Wales, the sovereign grant that is funded by UK taxpayers to cover the expenses of the royal household—all of them—is determined as a proportion of the Crown Estate's annual net profits, which is currently set at 25 per cent, having recently increased from 15 per cent in 2018. This means the royal family and all the royal household will receive a total of £110.65 million as a sovereign grant for this financial year, which is a record amount.
At a time when the cost-of-living crisis shows no sign of abating for so many Welsh households, with children living in poverty in every council ward across Wales, it's worth reflecting on this point, and to consider what more needs to be said before the clear and unambiguous case for the radical redistribution of wealth across the UK is actually taken seriously by the Westminster establishment and the class it serves. Because this is the 'why', Janet Finch-Saunders. This isn't constitutional tinkering.
Delyth has already spoken about the value of the Crown Estate's assets in Wales and the profits recorded, which should be contextualised against the continued pressures on the Welsh public finances. This perfect storm of stubbornly high inflation, the Tory mismanagement of the UK economy and the continued impact of Brexit has meant—and we hear it every day in this Chamber—that the Welsh finances are being squeezed like never before, with the Welsh Government's own analysis suggesting its spending power might be reduced by upwards of £1 billion over the next two financial years. We heard earlier today that it has no money to feed children at risk of hunger over the summer. Let's just let that sink in for a moment.
Furthermore, as the Office for Budget Responsibility's recent assessment of the UK Government's spring statement demonstrated, typical real household disposable incomes are on track to remain lower by the end of the decade than they were at the start. In cash terms, this means that the average household is predicted to be £1,800 worse off by 2027-28. There are also budget pressures on local authorities to consider—and we hear about that every day—which the Welsh Local Government Association recently quantified as £527 million for 2023-24. When taken with the financial pressures in the previous financial year, which were close to £257 million, the cumulative pressure would be £784 million by the end of 2023-24.
So, taken together, we just can't afford to pass up opportunities to benefit directly from resources such as those that fall within the Crown Estate's portfolio, so that we can expedite the essential process of restoring our eroded public finances. Further delays in acquiring the relevant powers will only mean yet more vast sums being swallowed up by the UK Government, rather than going straight into the economy of Wales where they rightly belong. Because if we want fairness for our people, if we really truly believe in equality, then to devolve powers over management of the Crown Estate and its assets in Wales is something we must demand, and something we must achieve. I urge Members to support the motion.
'I take this opportunity to confirm my willingness and intention to continue the tradition of surrendering the hereditary revenues, including the Crown Estate, to My Government for the benefit of all, in return for the Sovereign Grant, which supports My official duties as Head of State and Head of Nation.'
As Jenny Rathbone indicated, this has been the case since 1760. And to answer Jenny's question, it was a good deal for George III as it cleared all of his personal debt. With a King now who is a self-professed moderniser, is it now time to reform the Crown Estate? It's not a revolutionary idea that the management of the Crown Estate and its assets in Wales should be controlled in Wales for the benefit of all in Wales. Not this current constitutional nonsense, as Delyth Jewell aptly described the status quo, and as Sioned Williams highlighted. I’m sure the King, who is said to be a keen environmentalist, would welcome the Welsh Government having the power to set up a sovereign wealth fund that would ensure the environmental benefits of the Crown Estate would flow to support the communities of Wales. We could easily give him a list of projects to support. After all, at the beginning of the year, as Jenny said, it was reported that the King asked for profits from a £1 billion-a-year Crown Estate windfarm deal to be used for the wider public good, rather than as extra funding for the monarchy.
Although the Welsh Government has certain responsibilities in respect of planning permission and environmental considerations, it has very limited scope to shape energy policy in Wales, and this has a huge detrimental impact for the future of our country. This is not solely due to the lack of relevant powers being devolved, but also the way in which the energy system is operated in the United Kingdom, with a large private sector and limited overview by government regulators. This has been painfully felt by millions during this cost-of-living crisis.
Energy policy in Wales is also impacted by the fact that we have no independent electricity grid of our own, and it is therefore difficult to look at electricity policy within Wales on a holistic basis. In 2022, the then Under-Secretary of State for Wales, David T.C. Davies, said that he would look with interest at Liz Saville-Roberts’s Crown Estate (Devolution to Wales) Bill, but now, when he sits around the UK Cabinet table, where he could make the case for reform, he describes it as too risky. But as Rhun ap Iorwerth alluded, if the argument made by the Conservatives of fragmentation and complication is taken to its logical conclusion, then it’s an argument against any sort of devolution at all within the United Kingdom. However, devolution does exist, and the Crown Estate has already been devolved to Scotland. Devolution is here to stay, and it makes no sense at all that the Crown Estate is devolved in one part of the United Kingdom but not in another.
This isn't just a concern for politicians. This isn't just an interesting constitutional issue for the anoraks, Janet Finch-Saunders. In visiting the port of Cardiff back in 2021 with Heledd Fychan and Luke Fletcher, the managers of the port told us that devolving the Crown Estate would create huge potential in the area of renewable energy in Wales. The great concern for them and the great concern for me is that we're going to miss an incredible opportunity here in Wales whilst other nations forge ahead.
The example of Scotland, which has leapt ahead of the rest of the United Kingdom in the field of renewable energy, shows what is possible when a government is willing and able to take action.
Delyth Jewell's speech reminded me of the black dust I saw coming out of the mouth of a 93-year-old former miner in Ynyshir, not far away from the tip that fell recently. Coal dust had been in his lungs for decades. A Welsh Crown Estate will give the people of Wales more than just dust. It will give Wales the financial and long-term means to invest in our net-zero future. It will be a real step forward on the journey to make Wales a clean energy nation. Without it, I'm afraid targets will continue to be missed, warm words but no action will remain, and our future generations will suffer. Diolch yn fawr.
The region I represent is blessed with some of the most beautiful coastline anywhere in the world. Throughout our history, the Irish and Celtic seas have connected Wales with global trade routes, have provided food and other resources, have sheltered an incredible variety of animal and plant life, and have been a rich source of myths and legends that have enriched our language, culture and literature.
Today, these seas have the potential to make Wales a very prosperous nation by being a global leader in renewable energy, contributing positively to the climate crisis. However, our ability to maximise these opportunities, and harness them to improve the lives of the people I represent, is frustrated by the lack of control that we have as a nation over our own territorial waters.
It's a source of much frustration to me that, far from reaping the benefits of its extraordinary geography, Mid and West Wales is instead too often disadvantaged by it. The beauty of our coastline has often felt more like a curse than a blessing, attracting, as it does, high numbers of people seeking to purchase holiday homes, driving up rents and house prices, and forcing young people out of coastal communities. This hollows out those communities and poses an existential risk to the Welsh language. Low rates of employment and lack of opportunities, social deprivation and outward migration, particularly of young people, are chronic issues in my region. Last month, we learnt that, at 30 per cent, Ceredigion has the second highest level of child poverty of any local authority in Wales. And the latest Office for National Statistics' statistics on the labour market in Wales show the extent to which rural areas are being hit by stubbornly high rates of economic inactivity and the destructive low-wage trap. So, against this demoralising backdrop, right across the region, local authorities are also being forced to make cutbacks on their key services after more than a decade of Tory-imposed austerity.
Now, I'm saying this for a reason. It's absolutely galling, set against what we know about the value of the Crown Estate’s assets in Wales—as we've already heard, over £600 million at the end of 2021, not including the millions of pounds of profits made on these assets. The Crown Estate’s marine portfolio in Wales was worth £550 million in 2021, and the upcoming floating offshore wind leasing round is set to yield further substantial profits. Not one penny of that money will stay in Wales. Now, can you imagine what kind of difference that money would make to the lives of the people that I represent in those coastal regions? And what nation—and we've heard this from many speakers—would allow this wealth to flow out of their country to enrich others who already live a privileged life? It is also little short of scandalous, in my view, that there has been no protected role for the Welsh Government in determining the part that social value should play in this leasing round. We are forced, therefore, to rely on the UK Government and Crown Estate’s promises that communities will benefit from floating offshore wind in the Celtic sea, and that local supply chains and jobs will be protected. Forgive me for being a bit cynical, but I do find it difficult to take them at their word, and the current mood music around this is not encouraging. Crucially, decisions about securing and distributing the social value of floating offshore wind are a matter for, and should be a matter made in, Wales.
For too long, the geography of Mid and West Wales has been a barrier to economic development. Today offers a historic opportunity for the region to become a powerhouse for the green industrial revolution. The only way we can ensure that we take this historic chance, and ensure that its benefits flow into local communities, is by devolving the Crown Estate in full and that we do so immediately. Thank you.
Diolch, Llywydd. I welcome the opportunity to respond to this debate, and I welcome the motion from Plaid Cymru, which the Government will support in full. As the first country in the world to declare a climate emergency, we are working to lower our carbon emissions and harness the power of our natural resources to build a stronger, fairer and greener Wales. We have outstanding natural resources in Wales, as many people have pointed out, and we want to be able to use those to benefit people in Wales by investing in communities and supporting green, skilled jobs in every part of Wales.
It's very clear from the latest annual report and accounts that the Crown Estate benefits significantly from its assets in Wales and our offshore waters. It's also clear that the United Kingdom as a whole benefits from the income that is generated and the investment that the Crown Estate supports. But it is sadly not at all clear exactly how much Wales benefits from these incomes generated, and it's our view that we need greater control of the Crown Estate in Wales to ensure that the scale of its activities generates much greater benefit to Wales and brings into much closer alignment the management of its assets and resources in Wales with our distinct Welsh policy resource.
As set out in the co-operation agreement with Plaid Cymru, we support the devolution of further powers and the accompanying resources that Wales needs to respond most effectively to reaching net zero, and this specifically includes the management of the Crown Estate and its—I would say 'our'—assets in Wales. There are a number of areas where devolution would bring additional benefits to citizens in Wales, Janet, that you might particularly want to take notice of. Devolving control over the Crown Estate would give us greater flexibility to choose how far and fast we deploy renewables in Wales, and, indeed, it would allow us to make sure that the local economic benefit that accrued from that accrued to Wales, because, unlike the Tories, we do not always go for the shortest possible economic benefit, but, actually, we want to invest in the longest, widest and deepest possible economic benefit.
These benefits go far beyond meeting our climate targets. They generate a green economy, green skills, prosperity and wealth for all. As we agreed in this Chamber only last month, the management of our sea bed has a key role in safeguarding the blue carbon found there, and devolution of the Crown Estate would assure that many more decisions affecting blue carbon in Wales can be made in Wales, and the income generated could be used for the benefits of the Welsh people.
Llywydd, the Government will not be supporting the amendment to this motion proposed by Darren Millar, as this is just a statement of the status quo, and, for me, that is just not good enough for the people of Wales. We are already working very closely with the Crown Estate, and we will continue to work with them to deliver benefits to Wales. But this is just not the same thing as a fair share of the resources generated. I've met the chief executive officer of the Crown Estate on a number of occasions, including most recently with the First Minister, alongside, I'm pleased to say, the first-ever director for Wales, who is a very pleasant lady indeed and absolutely gets the Welsh agenda. And, to be clear, we have a very good relationship with Dan and the whole of his team, but this is just not the same as having an office of the Crown Estate in Wales or management and control over the way that they deploy those resources.
I do fully recognise the considerable work that the Crown Estate have been leading to scale up the deployment of marine renewables, in particular. In January, the Crown Estate announced that they had issued sea bed licences to 8 GW of offshore wind projects. This includes the 1.5 GW Mona project off the north Wales coast. This is a major milestone towards the goal of delivering these projects by the end of this decade. We were also very pleased that, last week, the Crown Estate confirmed their plans to lease the sea bed rights for up to 4 GW of new floating offshore wind in the Celtic sea.
This new generation will help us to support our renewable energy targets to fully meet our electricity needs from renewables by 2035, and our wider net-zero ambitions, although that will only happen—again, Janet, for your information, particularly—if the UK Government actually steps up to its responsibility to invest in the grid in Wales, which it currently is singularly failing to do. There is absolutely no point, as the First Minister said very recently in First Minister's questions, in arriving on the sea shore with a plug only to find there's no socket to plug it into. So, I absolutely can tell you very vehemently what the benefits of devolving the Crown Estate would be, because we could use the resources to invest in the grid.
We are also working very closely with the Crown Estate on developing the evidence base needed to ensure offshore renewables can be deployed sensitively with the continued management of the marine environment. The £50 million offshore wind evidence and change programme is adding considerable value to our understanding of the issues. But I have also been very clear in my discussions with the Crown Estate, as has the First Minister, that there needs to be a much greater focus on how their activities in Wales will benefit our businesses and our communities. We are clear that the transition to net zero must be a fair one, and we cannot be in a position again where Wales's natural resources are exploited with little lasting benefit to the people of Wales, as Delyth very eloquently set out. I have been very clear with the Crown Estate that they need to use the levers they have at their disposal to support lasting economic and social change in Wales.
The sea bed leasing process is absolutely fundamental to the ability to secure lasting commitments from developers on the investment of local supply chains securing local jobs and bringing new income into our communities. Yet it remains the case, I’m sad to say, that the Crown Estate does not have a process that sufficiently incentivises those local benefits. And I really have to say as well, Janet, that if you’re really concerned about it, given the absolute and abject failure of the recent contracts for difference round, where Erebus project did not see fit to bid in since the price had been set so low, it absolutely demonstrates the fundamental difference between going after short-term gain and what can be gained if you have a process that maximises local jobs and supply chains and investment in the future. So, you asked why we wanted it devolved—that’s why.
The motion we have before us rightly refers to the considerable income that the Crown Estate generates from activity in Wales. The remit of the Crown Estate is principally to generate income to the UK Exchequer via the process where the Crown abdicates its right. At a time of incredible pressure on public finances, I do appreciate the need to generate income from the management of the Crown estates, but the remit is too narrow and fails to account for the wider economic, social and community benefits that can and should arise from investment in Wales, where people deserve a fair share of the natural resources around them.
Llywydd, we are clear on the case for devolving the Crown Estate. There is already evidence on the benefits of how a devolved Crown Estate functions in Scotland, where they have been far more innovative in securing economic and social benefits from their sea bed leasing processes—another example of the asymmetry of the devolution settlement, and I am pleased that the Independent Commission on the Constitutional Future of Wales has identified energy as an area for further consideration in their work. We do need to consider the devolution of the Crown Estate against our wider devolved powers, including in energy. We also need to ensure that the devolution of additional responsibilities brings the appropriate transfer of resources. In Scotland, the Crown Estate already had a Scotland office, so devolution did not require a transfer of staff to Scotland. As I’ve already said, we’re very pleased that a director of Wales has been appointed, but further investment in an office for the Crown Estate is required in Wales.
We continue to call on the UK Government to devolve the Crown Estate, and we also call for the transfer of resources needed to ensure that the Crown Estate functions and continues seamlessly at the point of devolution. Llywydd, we could then ensure a Crown Estate for Wales would deliver on our distinct policy approach in Wales that delivers sustainable economic, environmental and well-being benefits to the whole of the people of Wales. The Government fully supports the motion and calls on all Members to support it unamended. Diolch.
Diolch, Llywydd. What is at the core of this debate? What is the core of our calls for the devolution of the Crown Estate? It's a simple but important principle: Wales's natural resources should be owned and controlled by Wales for the benefit of its communities. The majority of us here argue that we should empower our communities. In essence, this is a scaled-up version of that desire.
Now, I would like to thank every Member for their contribution, and the Minister for her response, but I suppose I should really start by making sure that Janet realises Rishi wasn't watching her contribution. Delyth referred to a famous Tolkien line. I'm a Tolkien fan—I'm not sure if Members are aware of that—but Janet's contribution was a bigger fantasy than 'Middle-earth' itself. I mean, if it's all right for Scotland, then why is it not all right for Wales? That's a question the Tories have yet to answer. I will give them an opportunity now to make an intervention.
Don't you recognise that the Scottish Government undersold the rights on the energy projects on the shoreline by the tune of £60 billion over the lifetime of those rights? That's one very good reason not to devolve to the Welsh Assembly here, because you need the experience to deploy those resources to maximise them for the Exchequer. This money goes to the Exchequer for the benefit of all the people in the United Kingdom.
I'm not entirely sure how to answer that, especially given that the leader of the opposition was perhaps more focused on eating the food in his mouth rather than actually taking part in this debate.
I will come back to Delyth. Delyth pointed out something very important: the sum of the wealth already available as part of the Crown Estate, as well as the potential that floating offshore wind will bring to the table. I'll attempt to reiterate her points, perhaps not in as eloquent a way as she did. Now, in 2020-21, the Crown Estate assets in Wales were valued at £600 million. That figure is likely to be more, given the recent announcement that the Crown Estate has signed leasing agreements for six offshore wind projects, which, together, will result in close to £1 billion a year. One of those six sites will be located off the coast of north Wales. The profits generated from these assets have rocketed in recent years, with the Crown Estate account for 2022-23 showing record net profits of over £440 million. Now, the scandal: not a single penny of that profit stays in Wales. It goes straight to the UK Treasury. The notion that that is the best place for it, given the UK Government's recent track record on finances and the economy, is absolutely staggering.
Sioned was right to refer to the current context. Large swathes of our resources are held by a monarch across the border living in a palace of 600-odd rooms, whilst thousands struggle to put food on the table, to heat their homes, and are now struggling to afford their mortgages and are at risk of losing their homes. If the case for redistribution of wealth ever was needed to be made, it's in this instance, but it goes deeper again with the potential of floating offshore wind. The Crown Estate's own research has shown that the Celtic sea has the potential to accommodate up to an additional 20 GW of flow capacity by 2045, beyond the current leasing rounds. The opportunity that that would bring for our communities, and advantages globally in terms of research and innovation and development, is breathtaking. If the Crown estates were devolved to Wales, that would represent a chance to strengthen those local supply chains, to enrich our communities, to think about community ownership.
We already have a target in Wales of 1 GW of renewable electricity to be owned locally by 2030. Think about how much this potential could help us further that goal and go beyond it, but also think of what it would mean to give our communities a stake in the means of production. There is no better place to refer to than Port Talbot, in my region, seen as a hub for heavy industry in south Wales, yet none of it owned by the people who live there. But that can change with offshore wind and the devolution of the Crown estates. Port Talbot is key to the green industrial revolution, and its residents should have a stake in that revolution.
Llywydd, we don't need to look far for examples of what the devolution of the Crown estates could bring. Rhun has already pointed out, much like justice, policing and water resources, the Crown estates are devolved to Scotland: ScotWind, the Scottish blue economy programme—just a taste of what we could do if only the profits of the Crown estates flowed directly to the Welsh Treasury. To the Minister, we are glad that the Government are supporting the motion. The more united our voice here, the better, and I look forward to the Minister convincing Starmer and seeing this in the UK manifesto.
Now, this, in its entirety, brings me back to my initial point. Profits made from Wales's natural resources should be kept in Wales to boost our economy. It should be as simple as that. That's why we're calling for those powers to be devolved. Do we want to rise up to the challenge of climate change? Do we want to empower our communities? If your answer is 'yes', then it starts tonight with the Senedd voting for Plaid Cymru's motion to demand power over the Crown estates.