Conflict over High Speed 2 rail extra cash for Wales
Finance Minister Jane Hutt insists Wales has had HS2 cash
(about 3 hours later)
There are conflicting claims from Welsh and UK governments over extra funding to Wales off the back of the High Speed 2 rail project in England.
Wales' finance minister has hit back at the UK government, insisting extra funding has been received because of the High Speed 2 rail project.
Finance Minister Jane Hutt told AMs there would be £35m extra in 2015-16 as a result of £832m spent on HS2, linking London and the north of England.
Jane Hutt said that, despite Treasury denials, the money had been transferred for 2015-16.
Wales gets a share of fluctuations in transport spending in England.
Wales normally gets a share of fluctuations in transport spending that benefits England only.
But the Treasury denies this, saying HS2 benefits the entire UK so Wales will not get extra cash in this case.
But the UK Government has always maintained the HS2 project benefits the UK as a whole.
Clarification is being called for amid claims Ms Hutt may have misled AMs.
However, the Welsh government say they have received a share of £832m to be spent on the HS2 scheme by the Department for Transport in 2015-16.
The issue of whether Wales should receive additional funding from the HS2 rail project has been at the centre of a bitter political wrangle in recent years.
'Very clear'
Ms Hutt's statement to the assembly's finance committee - where she informed members of the extra cash coming to Wales - was welcomed as a breakthrough by campaigners from across the political spectrum.
That would amount to around £35m extra for the Welsh budget in that year - a position denied by the Treasury.
It would have meant around £35m extra for Wales in 2015-16 and set a precedent for potentially billions more over the lifetime of the project.
But speaking to BBC Wales on Thursday, Finance Minister Jane Hutt said the Welsh government was "very clear" on the matter.
But the Treasury said the Welsh government's claim was mistaken - and HS2 was excluded from what is known as "Barnett consequentials".
Ms Hutt added that this episode demonstrated how the way the Welsh government is funded "needs reform".
Under that process, if extra money is spent on projects in England in services that are devolved in Wales, such as health or education, Wales receives a slice of extra money too.
The Welsh government receives a slice of the extra money that is spent in England on services that are devolved in Wales, such as health or education, what is known as "Barnett consequentials".
'Crisis of confidence'
That process would normally include transport spending, but Treasury officials say Wales would not get more cash as a result of extra spending on HS2, because they say the project benefits the entire UK.
That process would normally include transport spending - but not in the case of HS2, according to Treasury officials.
Treasury disagrees
"At the spending round, Wales received Barnett consequentials in the normal way; this excluded funding for HS2," a Treasury spokesman said.
The issue has been at the centre of a bitter political wrangle in recent years.
"The government is clear HS2 will be a vital part of our national infrastructure, boosting regional growth across the country and providing vital capacity the UK needs to compete in the global race.
Ms Hutt's statement to the assembly's finance committee on Monday - where she informed members of the extra cash coming to Wales - was welcomed as a breakthrough by campaigners from across the political spectrum.
"As with any government spending Barnett consequentials will be considered at the next spending review."
She told AMs there would be £84m extra in 2015-16, part of which came as a result of £832m spent on HS2 - a claim she maintains is true.
Plaid Cymru MP Jonathan Edwards said the issue potentially raised questions about the finance minister's competence.
However, the Treasury disagrees about the detail.
The MP for Carmarthen East and Dinefwr said: "For them [Welsh government] to claim that Wales has had a fair share...and for that to be incorrect would be an absolute crisis of confidence I believe in the finance minister."
"I've made many comments on the floor of the [House of] Commons that the Treasury is running rings around the Welsh government and if I was Carwyn Jones I'd certainly be asking questions about whether that minister is competent to hold that post," he told BBC Radio Wales.
A spokesperson for the Welsh Liberal Democrats said: "It is crucial that the finance minister clarifies this issue as soon as possible because if what the Treasury says is true, the finance minister has misled the finance committee.
"Assembly members expect the information provided to them by the Welsh Government to be accurate and correct."
Figures obtained by the BBC under a Freedom of Information request showed that Cardiff could potentially lose £70m in economic output once a high speed rail link opened between London and the north of England.
Figures obtained by the BBC under a Freedom of Information request showed that Cardiff could potentially lose £70m in economic output once a high speed rail link opened between London and the north of England.
