My Lords, this is a very important group of amendments because they deal with another recentralising measure in this Bill; that is, powers for the UK Government to spend money on wholly devolved areas of competence. Let us remember that power without spending power is hollow. At the least, this is a petty pot-shot at the devolved Administrations, while at the worst, it will lead to a direct conflict of policies and a huge waste of taxpayers’ money.
Let me give a hypothetical example on environmental spending. You could have the Welsh Government subsidising wind farms and the UK Government paying to close them down. Before anyone scoffs at that idea, in relatively recent years the Conservatives in Wales have campaigned against wind farms. In the best case scenario, it will lead to disjointed rather than joined-up policymaking.
The list of specified policy areas goes well beyond the usual devolved areas, so this is clearly a naked power grab. However, all of this is unnecessary because the UK Government can and do spend money on the devolved areas, but they do so in partnership with the devolved Administrations. City deals are a prime example of this successful approach. In these deals, the UK Government will set out pretty stiff conditions for additional funding. They do not simply hand over the cash. If we take the example of higher education, universities in Wales and Scotland receive funding from UK research funds, and here I declare an interest as chancellor of the University of Cardiff.
If the Government feel that they are not getting full recognition for their funding, they should take a leaf out of the EU’s book and put a badge on it. As the
noble Lord, Lord Dunlop, said in his truly excellent speech, they should not just fund and forget. In 2012 in the Wales Office, we recognised that the Welsh Government did not have enough capital funding for the significant infrastructure improvements that were needed if Wales was to compete economically. We gave the devolved Administration additional borrowing powers and we worked with the Welsh Government to agree a shared programme of funding for, for instance, the South Wales Metro. We worked with the grain of their views, but we still set the framework. Now I hear that the UK Government are threatening to build the M4 relief road, which the Welsh Government and local people have rejected.
Looking back to the days prior to devolution in Wales, there used to be huge rows about the smallest details of how social and economic support from the EU should be spent. Often, rather foolish decisions would be made by central Government, which were basically too remote from the areas concerned. The proposals in this Bill threaten a return to that centralised, counterproductive approach.
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The Government have been far from clear about how their shared prosperity fund will be distributed, as several noble Lords have said. In Wales, we are of course concerned; as the poorest part of the UK, we benefited greatly from EU funding. We have the most to lose. I have listened closely to Tory rhetoric on this and have concluded that all the pointers are in the direction of a bigger share of that funding for more prosperous England and, hence, less for Wales. That comes from the repeated pointing out that richer parts of England subsidise the rest of the UK. That has to be being done for a purpose.
Anyone doubting the self-interest of the UK Government in terms of England should look at the decision on furlough. When the Welsh Government called for furlough in Wales almost two weeks ahead of England, they were refused additional funding, but it was granted when the Prime Minister announced lockdown again in England. I would therefore be grateful if the Minister could explain further the principles on which this shared prosperity funding will be based. How will decisions be made? As my noble friend Lord German and the noble Baroness, Lady McIntosh of Pickering, asked, will it be on the basis of competition or of need? If it is competition, in my experience, the money inevitably goes to those organisations well enough resourced to fill in the forms well. Forgive me for being cynical; this Government are hardly known for spending money wisely, as both test and trace and the PPE scandals have illustrated.
For all its flaws, the Barnett formula is all that we have to ensure some transparency in how and why the devolved Administrations are given their block allocation and any specific in-year additions. The proposed additional power that the Government have placed in the Bill would undermine that and make it much less possible to ensure fair funding. That is a recipe for endless wrangling. I echo the warning from the noble Lord, Lord Dunlop, about the dangers to the union. Five years ago, support for independence in Wales was at 12%; one-third of people in Wales now support it.
We have to take that seriously and to listen to Douglas Ross, the Conservative leader in Scotland, who warned that the Government’s mishandling of Brexit was driving Scotland to independence.