A Senedd Committee is calling for a cultural shift in relations between Cardiff and London to stop the undermining of the Welsh Government by the UK Treasury.
The demand is in response to a ‘lack of mutual respect and parity of esteem’ experienced by the devolved institutions in Wales when trying to engage with the previous UK Government on financial matters.
Personality problems
The Finance Committee’s report finds that the ‘whims or personalities of Treasury ministers’ has been the overriding factor when it comes to communication between London and Cardiff. Whilst new inter-governmental structures have been put in place in recent years, these have yet to be tested.
Since the Committee started this inquiry, a new UK Government has been elected and there have been numerous changes within the Welsh Government.
The Committee is calling for both sides to take this opportunity to reset this relationship and ensure that processes are put in place to improve long-term communication.
Transparency and categorisation of projects
The report is also urging the UK Government to be more transparent with any future funding announcements and make clear if cash provided to Wales really is “new money” and not funding which has already been previously announced.
For example, the High Speed 2 railway between London and Birmingham is being treated as an England and Wales project, meaning Wales isn’t eligible for extra cash.
The Committee is calling for the Welsh Government to have a greater role in the categorisation of big projects like this to avoid the Treasury making subjective calls on decisions that have a significant impact on funding levels in Wales.
The Committee is also demanding that the dates of UK spending announcements are published in advance to enable the Welsh Government to plan its budget more effectively and to allow more time for the Senedd to scrutinise such decisions.
Undermining relations
When the UK Treasury makes funding decisions, the Committee found that they undermine inter-governmental relations by treating the Welsh Government like another UK Government department rather than a devolved government.
In future, the ‘Finance Interministerial Standing Committee’, which brings together the governments of the UK, Wales, Scotland and Northern Ireland, should be used to share financial information to the devolved governments in advance of spending announcements.
The Senedd Finance Committee is also frustrated with the lack of engagement from the UK Treasury. Budgetary decisions in the UK and Wales are closely linked because of devolution and so the refusal of Treasury ministers to appear before the Committee hampers its work.
The report expresses its wish for the new Treasury ministers in London to show more respect for the Committee and to engage with the Senedd in the spirit of openness and transparency.
Peredur Owen Griffiths MS, Chair of the Finance Committee, said, “Too often, politicians in London seem to pretend that devolution doesn’t exist, showing a disregard to the devolved institutions when making spending announcements.
“Today’s report shows that the relationship between the UK Government and the Welsh Government is strained and often ineffective – but there is hope for the future.
“The Committee is calling for maturity between the Welsh and UK governments. Informing the devolved governments about spending announcements that affect them should be built into the system, not just up to individual ministers.
“We’re hoping a new government in London will take the issues raised by this report seriously and reset the relationship to make sure that devolution is respected.”
