Confusion on the line: HS2 spending diversion

 

The high speed train arriving at a platform not very near you in the mid-2020s is, as Network Rail might put it, in reverse formation.

Twenty four hours after insisting HS2 had been excluded from calculations that decided the Welsh government's budget, the Treasury admitted that budget had indeed risen as a result of higher capital spending (including HS2) in England. With Plaid Cymru suggesting the money has been allocated "in error", the red faces and questions about competence appear to be in Whitehall rather than Cardiff Bay.

So how did Wales get a share of the HS2 cash? (£35m according to the Welsh government, although the Treasury still doesn't recognise that figure. There's a clue in this Treasury statement issued on Thursday evening if you can wade through the jargon: "At the spending round in June, the Welsh government received a capital consequential of £84.5m. This was based on a £2bn increase in the total DfT capital budget.

"The Barnett formula calculation used the framework set out at the spending review in 2010, which set out 73.1% per cent of changes in DfT spending are subject to Barnett consequential for the Welsh government. The framework is expected to be updated at the next full spending review, as is usual practice, and will reflect the latest information on departmental spending."

The Treasury now acknowledges that Wales may have got extra cash as a result of HS2 as the formula applied was the one used three years ago, since when the balance of national and England-only projects within the Department for Transport's budget may have changed.

There are still some unanswered questions. Why did the Welsh government choose to make such a significant announcement in such a low-key way (a letter to AMs) and why last month did it tell the Financial Times it was seeking a share of the cash, having been allocated some in the spending review earlier in the summer?

The Welsh government, which told MPs earlier this year: "Rail infrastructure is not devolved and as such we would not expect to receive consequentials" now says it is "pleased the position is now clear".

So is Plaid Cymru MP Jonathan Edwards, who said: " I'm even happier that the Welsh Finance Minister was right on this occasion as it vindicates the long standing Plaid Cymru campaign for a fair share of HS2 for Wales, albeit only on current expenditure.

"Welsh capital budgets continue to be squeezed and this error on the part of the Treasury has led to an extra £35m in the 2015-16 spending round." Mr Edwards, who has tabled parliamentary questions to the Treasury on the issue, said it would now become "a key election division line" at the 2015 general election. No party that has a chance of winning that election has yet committed to extra funding for Wales as a result of HS2.

MPs get a chance to debate the issue this Thursday, when a bill to authorise some preliminary spending on the scheme returns to the Commons. Plaid Cymru say they'll vote against the High Speed Rail (Preparation) Bill unless they get a cast-iron guarantee that extra funding will be heading along the M4.

They may have a long wait, longer perhaps than that faced today by commuters from my local station, where all trains had been cancelled.

 
David Cornock, Parliamentary correspondent, Wales Article written by David Cornock David Cornock Parliamentary correspondent, Wales

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  • rate this
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    Comment number 162.

    160- OK. If you think that you are grossly misinformed. Something I expect though from an individual of your less than developed knowledge of Wales. What a clanger that comment really was. You spelt ''themselves'' wrongly as well. Says it all really.

  • rate this
    -1

    Comment number 161.

    158- OK. I highly doubt they will though as they are currently engaged in wrecking the welfare state, widening the rich-poor gap and creating abysmal inequality.

  • rate this
    +1

    Comment number 160.

    So 5000 people who live in Bleaneu Gwent can correctly pronounce "Blinaw Gwent in cum-roo", hmmm. Start in Monmouth and head West on the A465 towards Wales (Dowlais of course) those calling themselfs English will slowly diminish, but you'll have to keep on the '465 to Neath until you find a fluent welsh speaker (if you're lucky)

  • rate this
    +1

    Comment number 159.

    RE 158.

    Ben, I'd love to respond to you, but there is a reason why I can't. So, I've asked the Conservative and Unionist party to look into the antics of BBC Wales.

  • rate this
    -2

    Comment number 158.

    156- Not unless I have about 5000 fingers no. And correct, but the English border never reflected the use of Welsh, and indeed borders rarely reflect the beginning and end of any language group so that point is laughably irrelevant. Also you are in cloud cuckoo land if people here actaully believe themselves to be English based on an arbitrary, meaningless 16th century botch job of an act.

 

Comments 5 of 162

 

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