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Welsh valley lines rail electrification row is settled Welsh rail electrification impact 'will be huge', PM says
(35 minutes later)
A deal has been struck to electrify railway lines in the south Wales valleys after a row between the UK and Welsh governments over who should pay. A deal to electrify railway lines in the south Wales valleys will have a "huge" impact, the prime minister says.
The UK government will fund the upgrade of the Swansea-London mainline by 2018 at a cost of £850m, and will put £125m towards electrifying the Valley lines. The UK government will fund the upgrade of the Swansea-London mainline by 2018, and will pay almost half an estimated £500m to electrify the Valley lines.
Reduced costs and increased revenues are expected to cover the rest of the project's predicted £463m cost. The Welsh government expects to meet its share from cost savings and increased revenue.
Prime Minister David Cameron said the impact of the deal would be "huge". The agreement settles a bitter dispute between Westminster and Cardiff Bay over who should foot the bill.
First Minister Carwyn Jones said he was "delighted" with the agreement. The UK government is also handing over control of the Welsh rail franchise to the Welsh government.
It also includes £105m from the UK government to upgrade the Cardiff-Bridgend stretch seen as crucial to the success of Valley lines electrification. First Minister Carwyn Jones said he was "delighted" with the deal.
Together with the funding deal, it was also announced that control of the Welsh rail franchise had been handed to the Welsh government, giving ministers the power to make decisions about its future. Electrification of the Valleys lines, due to follow the £850m upgrade of the mainline, was thrown into doubt in March by a row over the financing of the project.
Planned rail improvements will see the upgrade of the main line from London Paddington to Cardiff, which is due to be completed by 2017, and extended to Swansea by 2018.
The electrification of the Valleys lines was due to follow, but the plan was thrown into doubt in March by a row over the financing of the project.
On and off the railsOn and off the rails
'Opportunities' 'Transform communities'
In a speech at the UK Investment Summit Wales in Newport, Prime Minister David Cameron said: "After years of neglect, this part of Wales will finally get the infrastructure it needs - faster, modern, more efficient trains. In a speech at the UK Investment Summit Wales in Newport, Prime Minister David Cameron said: "After years of neglect, this part of Wales will finally get the infrastructure it needs - faster, modern, more efficient trains.
"And I believe the impact will be huge. It will spread employment opportunities from Cardiff and beyond."And I believe the impact will be huge. It will spread employment opportunities from Cardiff and beyond.
"It will transform communities throughout the valleys, and it'll help people from all parts of this great nation to get on." "It will transform communities throughout the valleys, and it'll help people from all parts of this great nation to get on."
Mr Cameron said the deal was the result of a "real partnership" between the UK and Welsh governments and paid tribute to Welsh Secretary Stephen Crabb for what he called his "hard patient work" to achieve an agreement.
It is estimated that electrifying the Valley lines will cut journey times from both Merthyr Tydfil and Treherbert to Cardiff from just over an hour to around 50 minutes.It is estimated that electrifying the Valley lines will cut journey times from both Merthyr Tydfil and Treherbert to Cardiff from just over an hour to around 50 minutes.
A decision on who will run the Wales and Borders rail franchise after 2018 will also become the responsibility of the Welsh government.
First Minister Carwyn Jones said: "Together with an agreement to fully devolve power over the Welsh rail franchise this will allow the Welsh government to move forward with its ambitious plans to create the efficient and reliable rail service Wales needs and deserves."First Minister Carwyn Jones said: "Together with an agreement to fully devolve power over the Welsh rail franchise this will allow the Welsh government to move forward with its ambitious plans to create the efficient and reliable rail service Wales needs and deserves."
'Keen to learn' Welsh Liberal Democrat transport spokesperson Eluned Parrott AM said the experience of passengers would now be "transformed".
Mr Crabb said the deal had been "dead" when he took on the ministerial role four months ago but he decided to get all sides around the table because the plans were "too important to lose". Plaid Cymru transport spokesman Rhun ap Iorwerth said the deal was a "good step in the right direction" but called for rail infrastructure to be devolved to Wales as well as franchising.
He said the agreement had been reached just in time to ensure the original timescale for the project had not changed. Arriva Trains Wales, which runs the Valley lines, welcomed the news which it said would "modernise" rail infrastructure and trains.
"It was really important to get a deal quickly because there was a serious risk that things could start to get pushed back," said Mr Crabb, MP for Preseli Pembrokeshire.
He said he believed the Welsh government would be able to "handle" running the franchise, saying it had been working closely with the Department of Transport in London and will continue to do so.
"They're keen to learn, we're keen to work with them towards devolving the franchise," he added.
'Long neglected'
Owen Smith, shadow Welsh secretary and Labour's MP for Pontypridd, said the prime minister had been "doing the hokey cokey on funding the Welsh railways for over a year".
"Welsh rail passengers will be pleased he's finally made his mind up, even if, in the end, the Welsh government is going to have to foot some of the bill," he added.
Eluned Parrott AM, the Welsh Liberal Democrat transport spokesperson, said the experience of passengers will now be "transformed".
"Valleys trains have been neglected for far too long by successive governments, and these improvements will bring a huge boost to our economy as journey times are reduced and quality improved," she said.
Arriva Trains Wales, which runs the Valley lines, welcomed the news which would "modernise" the rail infrastructure and trains.
"Electrification will bring many benefits including quicker journey times, reduced running costs, lower carbon emissions and the replacement of the current rolling stock on this part of the network which is nearing forty years old," a spokesperson said.
Analysis by Nick Servini, BBC Wales political editorAnalysis by Nick Servini, BBC Wales political editor
So who blinked first?So who blinked first?
It genuinely appears that the position of both sides moved with the cost - of around £500m - being split roughly in half.It genuinely appears that the position of both sides moved with the cost - of around £500m - being split roughly in half.
A senior Welsh government official told me the main concession from Westminster was putting up £230m.A senior Welsh government official told me the main concession from Westminster was putting up £230m.
The Welsh government's share of the cost will partly be funded by the increased revenue from more passengers who are expected to use the new electrified routes.The Welsh government's share of the cost will partly be funded by the increased revenue from more passengers who are expected to use the new electrified routes.
The risk for ministers in Cardiff Bay is whether those extra passengers materialise.The risk for ministers in Cardiff Bay is whether those extra passengers materialise.
At this stage no one side is claiming victory over the other, although the arrival of a new Welsh Secretary in the form of Stephen Crabb was clearly a major factor in breaking the deadlock.At this stage no one side is claiming victory over the other, although the arrival of a new Welsh Secretary in the form of Stephen Crabb was clearly a major factor in breaking the deadlock.
Politically, both governments clearly thought it wasn't in their interests for the row to continue.Politically, both governments clearly thought it wasn't in their interests for the row to continue.