Investing in Wales – important announcement

The Welsh Government made an important statement about investing in infrastructure this week. Here is the statement made by the Cabinet Secretary for Finance:

“Llywydd, at the height of the recession – and in the early years of the UK Government’s flawed and damaging austerity programme – my predecessor Jane Hutt, published the first 2012 Wales Infrastructure Investment Plan.

Ever since, this plan has been at the heart of the Welsh Government’s work to create and sustain economic growth and support vital public services

Its goals and priorities have guided our significant infrastructure investment across Wales, including, in the last Assembly term alone:

  • £1.2 billion to provide more than 11,500 affordable homes;
  • £1.3 billion to support our 21st Century Schools and Education programme – 100 schemes have been completed and 60 more are on their way;
  • £1.8 billion to modernise our transport infrastructure from the Heads of the Valleys road to the Newtown bypass.

Llywydd, we have done this – and more – at a time when our conventional capital budget, will be 20% lower in real terms by the end of the decade than it was in 2009-10.

And all of this just at the point in the economic cycle when the UK Government should have stepped up – and not shied back from – investing in the future.Here in Wales, in the six years since the WIIP was first published, we have invested £9 billion of our own capital funding and developed new ways of drawing in investment from elsewhere to deliver ambitious projects which deliver lasting benefits for the people of Wales.

Llywydd, a great deal has changed since 2012. Back then the Chancellor of the Exchequer promised austerity would be over by 2015. Now it extends to 2025. We have had the EU referendum and the decision to leave the EU. The impact of the uncertainty this created must help explain why, at a time when economies across the Eurozone are growing at their fastest rate for a decade, growth across the UK is faltering and is at its weakest since 2012.

Llywydd, that is the background against which our mid-point review of the Wales Infrastructure Investment Plan is published today. The review reflects on the experience of the past six years – where we can see progress and where we can draw lessons for the future.It takes account of the many changes which have occurred over the lifetime of the plan so far. And it sets out our investment priorities for the remaining period of the plan, aligning it with the aims and goals of Prosperity for All and the Well-being of Future Generations Act and setting the Welsh Government’s spend more directly in the context of the investment which others plan to make in Wales.

Llywydd, we have ambitious plans to invest further in Welsh infrastructure, with plans already set out to invest an additional  £6.5 billion of capital in our priorities to 2020-21.And today I can set out a new capital funding package of £266 million to support the delivery of government priorities over the next three years. Among other objectives, these investments are strongly aligned to support the work of my Cabinet colleague Lesley Griffiths, in the vital field of carbon reduction.The new funding allocations include:

  • £60 million over three years to accelerate the creation of active travel routes to connect residential areas, work, education sites and services
  • £60 million over three years for the NHS all-Wales capital programme
  • £31.5 million over three years for next generation access broadband phase 2
  • £25 million over three years for the Tech Valleys programme

 

  • £15 million over two years to fund a pilot as part of the Ministerial Taskforce for the South Wales Valleys to ensure schools become community hubs and provide community learning centres with extended services. The mid-point review also includes an up-to-date pipeline of Welsh Government, local authority and private sector investments. It provides details of more than 350 schemes with a value of around £42 billion, including this government’s own flagship commitments.Llywydd, as members of the Finance Committee know, my principle has always been to exhaust the use of the least expensive forms of capital before using other, more expensive, sources.

The plan relies on our efforts to:

  • Commit the vast bulk of our conventional capital well in advance;
  • To deploy every pound of capital available to us through regional development funds from which Wales benefits as a result of our membership of the European Union – that’s over 720 million in additional investment;
  • To make full use of the 1 million in borrowing powers now available to us,
  • To go on supporting additional borrowing for investment by our local authorities and our housing associationsAnd because, even when we have pushed at the limits of all these possibilities, we still have vitally important public purposes which could otherwise not be afforded, we have devised our own Mutual Investment Model, building from the Scottish Government’s not-for-profit schemes, to find a way to fund the new Velindre cancer hospital for South Wales, to complete the dualling of the A465 Heads of the Valleys road, and to enable us to accelerate Band B of our 21st Century Schools and Education programme.And, Llywydd,

 

I can announce today the latest development in this area because in line with the provisions in the Government of Wales Act 2006, agreement has now been secured with the UK Government that it will bring forward legislation to enable Welsh Ministers to issue bonds for capital investment expenditure, providing the Welsh Government with a further set of borrowing levers in the future.  Llywydd, we are in the process of establishing a National Infrastructure Commission for Wales and later this afternoon the Cabinet Secretary for Energy, Planning and Rural Affairs will make a statement about our preferred option for our new land use plan, the National Development Framework. Together these will provide a strategic picture of our national and regional infrastructure needs and help us ensure our investments are aligned and targeted to where they can have maximum impact in the face of continuing austerity. The mid-point review of the WIIP will help us to work more collaboratively and in a more integrated way both within government and with our partners. It will ensure that our infrastructure is resilient, contributes to a growing Welsh economy and helps shape the long-term future of our country and its people. I commend it to the Assembly”.

Comments for this post are closed.