We have maintained that the views of the Welsh Government are important, but the views of other stakeholders in Wales are also relevant to the discussion. The Welsh Government will rightly form their view, and the UK Government will come to a conclusion that serves all parts of the United Kingdom, including other stakeholders in Wales, as part of the process. The legal action that the Welsh Government took was a matter for them. We have had the judgment, and we need to respect and act on it.
I shall return to the fiscal framework and the funding settlement for Wales. I have already mentioned Professor Gerry Holtham, but it is appropriate that we pay particular tribute to him for the work that he did. We should also pay tribute to my right hon. Friend the Chief Secretary for the part he played in the negotiations, and to the way that the Welsh Government and Mark Drakeford, the Cabinet Secretary for Finance and Local Government, went about the negotiations with my right hon. Friend, whereby two mature institutions discussed serious matters that will have long-term positive consequences for Wales.
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Building on the existing funding floor, the Welsh Government will continue to have a fair level of funding for the long term, taking into account Welsh tax capacity and treating population change consistently. For the
first time, we have agreed to add a need-based factor of 115% into the Barnett formula, as Holtham recommended. We are embedding the funding floor that we announced in December 2015 into the mechanisms that decide how Wales is funded. The significance of this measure should not be understated: the Labour party called for it from Cardiff Bay for many years while it was in power in this place, but it has taken a Conservative Government to introduce that needs-based factor and deliver on Wales’s needs. I hope that the shadow Secretary of State, the hon. Member for Cardiff Central (Jo Stevens), will recognise the significance of bringing the needs-based factor into the Barnett formula.