Wales is set to miss out on more than £1bn of funding for transport after the UK Government classified a second rail scheme based entirely in England as an “England and Wales” project.
The decision to classify Northern Powerhouse Rail as benefitting both England and Wales follows the controversy over the High Speed 2 (HS2) rail link which has been classified as England and Wales despite connecting London and Birmingham and then on to Manchester. Wales is set to miss out on as much as £5bn in consequential spending if the HS2 project costs £100bn, although the latest reports that the line to Crewe is being delayed for two years suggest that the current estimate is £71bn, which would make Wales' share £3.55bn.
Northern Powerhouse Rail (NPR) is a proposed major rail program that will see big upgrades to the connectivity of northern parts of England. Originally it was supposed to build a new line connecting areas such as Manchester and Leeds but it has since been scaled back but still include significant improvements to rail in the north of England including Liverpool, Manchester, Leeds, Bradford and York.
The original cost of the NPR project was £39bn investment however this was estimated to be only £17.2bn (by 2019 prices). Bearing in mind that these figures are estimates (and inflation in recent years have pushed costs of large scale projects up even higher) it is likely Wales would have been entitled to at least £1bn in cash as a Barnett consequential over the lifetime of the project if it were classified as an England-only scheme. Crossrail in London is an example of a major rail project that was classified as England-only meaning that consequential spending was provided to Wales.
However when WalesOnline approached the Treasury they confirmed that they were classing Northern Powerhouse Rail as an “England and Wales” meaning there will be no automatic consequential payments for Wales to help boost its woefully underfunded rail service.
It is understood the Welsh Government believes there may be ways in which some spending for transport in Wales could result from the NPR project but that will depend how the funding for NPR is channelled.
Just last week at Prime Minister's Questions Rishi Sunak said that the Tories were "actually delivering the biggest rail investment since the Victorian era" and were "delivering for communities across the north".
Plaid Cymru has labelled the idea that these projects will benefit Wales as “blatant lies”.
Plaid’s Westminster leader Liz Saville Roberts MP said: “Welsh rail is plagued by a combination of outdated Victorian infrastructure and inadequate funding, resulting in slow, expensive, and unreliable trains. Geographically, the majority of our country is not accessible by rail, making it impossible to travel from north to south without crossing into England.
“When huge investments are planned in England – we should at the very least expect to be compensated with equivalent funding to improve our inadequate network. Instead, Westminster pushes blatant lies about how English projects will somehow benefit us in Wales.
“People in Wales want decent, cheap, reliable public transport. Improvements to travel times between Liverpool and Leeds will clearly do nothing to improve transport within Wales. In fact, Northern Powerhouse Rail is likely to actively harm the Welsh economy, by giving the north of England a competitive advantage over Wales. Time and again, the Tories undermine the Welsh economy, while Keir Starmer’s Labour Party are all too happy to nod along. Plaid Cymru demand a fair deal for Wales through the full devolution of rail infrastructure.”
When WalesOnline approached the Treasury to ask why Norther Powerhouse Rail was being defined as a Wales and England project they indicated that the benefits would be set out in "due course".
A UK Government spokesman said: “The UK Government is responsible for heavy rail infrastructure across England and Wales so spends money on this in Wales directly rather than funding the Welsh Government to do so. This is consistent with the funding arrangements for all other policy areas reserved in Wales.
“The UK Government’s existing rail investment in Wales includes upgrading the signalling on the Cambrian Line, developing upgrades for Cardiff Central Station, re-opening Bow Street Station, and the electrification of the Severn Tunnel.”
A Welsh Government spokesman said: "Northern Powerhouse Rail should be treated as an England-only project, which would mean that Wales would receive a population share of the funding for this project to support investment in Wales. It would be wrong if HM Treasury treats the funding in the same way as for High Speed 2.”
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