Wales’ First Minister, Eluned Morgan, is exerting pressure on the UK Government regarding the HS2 rail development funding issue. Despite the Treasury’s recent announcement that they will not reconsider providing Wales with funds related to HS2, Morgan continues to advocate for financial support. The Labour-led Treasury confirmed its decision not to alter the categorisation of the HS2 project or allocate consequential funding to Wales in the near future. A spokesperson stated that the UK Government’s responsibility for heavy rail infrastructure means they allocate funds directly in Wales rather than through the Welsh Government.
The classification of HS2 as an “England and Wales” scheme by the UK Treasury has been a contentious issue between the two governments. This designation excluded Wales from receiving funding through the Barnett Formula, which provides funds to devolved nations based on UK government spending. Despite calls for reassessment, the UK Government’s stance remains firm on the funding arrangements for the HS2 project. While Scotland and Northern Ireland received additional funds, Wales did not due to the perceived benefits for Welsh residents in terms of improved travel times to London. Notably, no HS2 track was planned to be built in Wales.
Former Conservative Prime Minister Rishi Sunak’s decision to cancel parts of the HS2 project from the midlands to Manchester raised concerns about Wales missing out on funding. Labour representatives in Wales, including Eluned Morgan, have consistently pressed for fair funding and reimbursement for the perceived financial loss. Plaid Cymru estimated the shortfall could be as high as £4 billion, whereas Wales’ former finance minister, Rebecca Evans, cited £350 million as the sum Wales missed out on. In the recent Senedd plenary session, Morgan reiterated the importance of ongoing discussions with the UK Government to address equity issues surrounding the HS2 investment.
Despite the ongoing debate surrounding the actual financial impact on Wales, the First Minister continues to advocate for fairness in investment decisions. While clarifying that the estimated figure of £4 billion may not be accurate, Morgan emphasized the importance of fairness and ongoing dialogue with the UK Government. The Labour-led Welsh Government remains committed to pursuing a resolution to the HS2 funding issue and ensuring equitable treatment for Wales in infrastructure investments.