1. What discussions has the Welsh Government had with the UK Government regarding fair funding for Wales? OQ60924

I have repeatedly made the case to the UK Government for fair funding for Wales through regular meetings with the Chief Secretary to the Treasury and through correspondence with the Chancellor of the Exchequer.

Thank you for the answer. 

We of course see the consequences of inadequate funding and misalignment with the needs of people in some of its harshest terms here in Wales. The case for scrapping the Barnett formula in favour of a needs-based system is overwhelming and bolstered by the fact that there is cross-party consensus around the need to seriously examine the funding landscape. Now, even though everyone here is sympathetic to the argument, it seems that the Welsh Government hasn’t been particularly influential when it comes to getting a Conservative UK Government to change the policy. Why does the Cabinet Secretary think this is the case? And with a general election on the horizon, what guarantees are there that a Labour Government would deliver on fair funding?

I’m grateful for the question and also for the recognition of the cross-party support that there is here in the Senedd in terms of the raw deal that we get in Wales when it comes to funding, and the fact that we have a shared interest in those fiscal flexibilities that would help us manage the budget in a better way.

Looking forward, I know there are some nuances in the different ways our parties see the future funding of Wales, but, certainly, from a Welsh Government perspective, we set out our vision in 'Reforming our Union', and that should be about the UK Government replacing the outdated Barnett formula with a new, principles-based approach to UK funding and fiscal networks, taking account of relative need. And that, certainly, is the way that we would see things moving forward and the way that we will certainly press the UK Government to move forward.

I think, perhaps, one of the reasons why we haven’t had the traction that we would want to have with the UK Government has just been the constant churn of people who we’re negotiating with. So, by the time that Ministers, particularly Chief Secretaries to the Treasury, are up to speed on these issues, there’s another one coming through the door. So, I think a level of stability would help us in those discussions. And, honestly, perhaps there’s a lack of interest on the part of the UK Government in terms of engaging seriously with these questions about funding as well. But we’ll continue to make those cases. I think the very mature cross-party consensus that we have here in the Senedd is important, and also those agreement areas that we have with other parts of the United Kingdom are also very useful in making those cases.

It is worth repeating sometimes that the Welsh Government does receive £1.20 for every £1 spent in England—a Union dividend. And even Keir Starmer must think that that’s a good deal, because he has no plans to change it either. But perhaps we need to talk more about the decisions that this Welsh Government makes with its money. To govern is to choose, and you’ve chosen 20 mph speed limits over education, airports over apprenticeships, and 36 more politicians over 650 more nurses. Will this Welsh Labour Government, under new leadership, choose to reflect on its own record in Government and the choices that it makes with its spending, rather than making excuses and deflecting blame onto others?

The first thing I’d just like to remind colleagues about is the fact that the funding that does come to us here in Wales does reflect that we have a generally higher level of need, and the point there being that it costs us more to deliver things here in Wales because we have a much more sparsely allocated population, for example, and a much older and sicker population here in Wales. And that funding reflects that, as it does in other parts of the United Kingdom as well. So, I think the fact that that’s been recognised in the recent discussions that the UK Government has been having with Northern Ireland is a positive thing, and it shows that the UK Government remains committed to that. But, that said, we’ve just been talking about how the Barnett formula does need to better reflect really genuine need across the United Kingdom, and that’s something we’ll continue to press for. 

In terms of the choices that this Government makes, we’ve recently passed our budget for the next financial year, and in that you see us prioritising the things that matter most to people in Wales. Now, the NHS across the border in England is seeing an increase in funding in this financial year of less than 1 per cent. Here in Wales, it’s at least 4 per cent, and I think that shows the relative priority that we put on the NHS, which we know is people in Wales’s top priority. But, alongside that, we also protected the funding that we had allocated through the spending review to local government. Local government will receive a 3.3 per cent increase in its funding in this financial year, and, again, that recognises the importance of those services that people receive on their doorstep, in their communities, across Wales. We would have liked to have gone further, but, unfortunately, the settlement that we received from the UK Government didn't allow us to, but the priorities that we chose were absolutely about funding public services.