The Economy Minister will today (Tuesday 16th January)
say in a Senedd debate that the UK Government’s Levelling-Up
schemes are failing Welsh people, businesses, and communities as
the amount of unreplaced EU funding rises with inflation.
will argue that in real
terms Wales is now short-changed by almost £1.3bn in unreplaced
EU structural and rural funding between 2021 and 2025 due the
ongoing impact of inflation in this period.
This shortfall is on top of the overall Welsh budget now being up
to £1.3bn less in real terms than when it was set at the UK
Government’s Spending Review in 2021 due to decisions taken by
the UK Government and soaring inflation.
Economy Minister will say:
“All of the UK Government’s schemes – whether it’s the Levelling
Up Fund, the Shared Prosperity Fund, or the Towns Fund – have the
same things in common: they are an incoherent mess with very
little planning, consultation or economic logic.
“Their implementation is chaotic leaving stakeholders confused or
excluded entirely. At the same time, they put immense pressure on
local government to spend money quickly despite UK Government
delays and implausible deadlines.
“Plus, they take money and powers away from Wales putting them in
the hands of UK Government Ministers in London, meaning Wales has
less say over less money.”
The result is Merthyr Tydfil, Flintshire and Newport will not see
any money from the Levelling Up Fund despite using time and
resources on bids turned down by the UK Government.
“UK Government delays in decision-making have driven up costs
during a cost-of-living crisis with soaring inflation that has
loaded extra pressure onto our councils”, the Minister will add.
The Welsh Government previously used EU funding to help tackle
unemployment, deliver apprenticeships and training, create and
grow businesses, and invest in infrastructure and major projects
like the South Wales Metro and the renewable energy sector in
North and West Wales.
Universities were also supported to deliver high-level skills and
growth programmes in partnership with industry and work with
businesses on cutting-edge Research and Development.
Under the UK Government’s Levelling Up agenda, it is estimated
around 1,000 high quality jobs in research and innovation are
being lost in Wales as universities cannot access these funds at
anywhere near the same scale.
The Minister will add:
“Wales already faces the toughest financial situation since the
start of devolution.
“The legacy of Levelling Up is duplication, local piecemeal
projects and precious little economic impact. Through ineptitude
and indifference, the UK Government has wasted the opportunity to
deliver the meaningful change Wales and the rest of the UK so
desperately needs to see.”
Notes to editors
On 4 May 2022, the Welsh Government Minister for Finance and
Local Government issued a Written
Statementwhich provided a breakdown illustrating the
£1.1bn loss to Wales from EU structural and rural funding
unreplaced by the UK Government. This figure has increased in
real terms given the impact of inflation in this period. The new
shortfall figure reflects the latest Office for Budget
Responsibility GDP deflator forecast.
