The following amendment has been selected: amendment 1 in the name of Darren Millar.

Item 6 on the agenda this afternoon is a debate on the shared prosperity fund, and I call on the Minister for Finance and the Trefnydd to move the motion—Rebecca Evans.

Motion NDM7062 Rebecca Evans, Rhun ap Iorwerth

To propose that the National Assembly for Wales:

1. Notes:

a) that Wales receives around £370m every year in structural and investment funds as a result of the UK’s membership of the EU;

b) the promises made during the EU referendum that Wales would not lose a penny as a result of the UK leaving the EU;

c) the support of the National Assembly’s External Affairs and Additional Legislation Committee, Finance Committee, the All Party Parliamentary Group on Post-Brexit Funding for Nations, Regions and Local Areas and most stakeholders for future arrangements which respect the devolution settlement.

2. Regrets the lack of detail from the UK Government about its proposals for a UK Shared Prosperity Fund and that it failed to respect the devolution settlement in developing these proposals.

3. Rejects the idea of a centralised or UK-directed fund or one which seeks to bypass the devolved administrations post-Brexit.

4. Calls on the UK Government to:

a) fulfil the promise that Wales would not a lose a penny as a result of leaving the EU;

b) respect devolution and ensure Wales retains the autonomy to develop and deliver successor arrangements for structural and investment funds tailored to the distinctive policy, legislative and partnership landscape in Wales.

Motion moved.

Diolch, Dirprwy Lywydd. This debate takes place during a time of absolute chaos brought about by the UK Government's handling of Brexit. Parliament is gridlocked, and the election of a new Conservative leader means the prospect of a catastrophic 'no deal' Brexit is very real. We're likely to face a straight choice between a 'no deal' Brexit or remaining in the EU. Faced with this prospect, we will campaign to remain in the EU and believe that Parliament must legislate as soon as possible for a referendum to decide on this issue.

The chaos being inflicted by the UK Government also extends to the lack of clarity on how the vital £370 million a year of EU structural and investment funds in Wales will be replaced. Over the last two decades, EU funding has helped to bring new and better jobs to Wales, and given people the skills to do them. Twenty years ago, Wales had some of the highest levels of worklessness in the UK. Over the last 12 months, unemployment and economic inactivity have been at record lows and better than most parts of the UK. EU funds have supported the creation of 48,000 new jobs and 13,000 new businesses. They've assisted 25,000 businesses with funding or support, and helped 86,000 people into employment. Over 300,000 new qualifications have been delivered. 

EU funds have improved broadband coverage, built research capacity, invested in renewable energy, and developed vital infrastructure for transport, tourism and business. These and a wide range of other benefits are at risk without continued long-term and needs-based investment. 

Despite the significant improvements across Wales since devolution, inequalities within the UK persist and are the highest in the EU by a large margin. These problems will not go away with Brexit. The vast and overwhelming majority of credible economic analysis suggests it's the most economically vulnerable areas that will be hardest hit by Brexit. So, we need to ensure ongoing investment to avoid undoing the progress that we've made. 

What is the UK Government's message to the people, businesses and communities across Wales whose future this funding is supporting every day? The UK Government proposed a UK-wide shared prosperity fund to replace EU funding over two years ago and promised repeatedly to consult on it during the course of 2018. They have not done so. Meanwhile, they have repeatedly refused to engage meaningfully with us on replacing this funding in Wales. 

Since the referendum, our calls have been consistent and clear. We have called for not a penny less than we would have expected within the EU, simply asking for the promises made to the people of Wales during the 2016 referendum to be honoured. We have also called for the Welsh Government to retain autonomy in the development and delivery of successor arrangements, simply asking for devolution, voted for twice by the people of Wales, to be respected. The UK Government has committed a number of times to respecting devolution in developing the shared prosperity fund, but their actions have resolutely not done so.

So, let us be clear—the prevarication and lack of clarity from the UK Government is putting the future livelihoods of people, communities and businesses across Wales at risk. Ignoring long-standing conventions on inter-governmental working and undermining devolution settlements puts our whole union at risk. In stark contrast, the Welsh Government's approach to the development of a future regional investment approach has been immediate, clear and outward looking. We've engaged widely with Assembly committees and all-party parliamentary groups. Stakeholders including the FSB, WLGA, Universities Wales, HEFCW, and WCVA, and think tanks including the Joseph Rowntree Foundation and the Institute for Public Policy Research, all support the Welsh Government's position. 

My colleagues and I continue to raise the issue of replacement funding, reinforcing our positions and pressing for clarity from the UK Government, and this has included in meetings of the joint ministerial committee, my finance Ministers' quadrilateral meetings, and through correspondence. The First Minister has raised these issues with the Prime Minister, and, of course, we will continue to press hard our position with the new Prime Minister and Cabinet. 

We've been told decisions on replacement funding will be made during the comprehensive spending review. With this now likely to be delayed, we need urgent clarity on a long-term, needs-based funding settlement. Within the EU, we would already have had this certainty, and we would be planning new programmes with the confidence of replacement funding and the autonomy to deliver it. What we cannot and will not do is stand still until these issues are resolved. It's not what our communities, our people and our businesses would expect of us, and Wales's future is too important. 

Over the last 18 months, we have had detailed contributions to the debate on successor arrangements in Wales from stakeholders and Assembly committees. These build on the direction of travel in our Brexit policy paper, 'Regional Investment in Wales after Brexit'. We've established a regional investment for Wales steering group to provide us with advice on successor arrangements, drawing on expertise from business, local government, academia and the third sector. Detailed work will continue with partners in Wales and beyond over the summer, whilst the UK Government looks inwards yet again.

I thank the chair, Huw Irranca-Davies, and members of the steering group for their commitment to date. In response to views from stakeholders, my predecessor set out the principles to underpin our preferred approach in October of last year. We'll ensure that replacement funding is invested in regional development and in reducing inequality. We'll do this on a multi-annual basis within our own budget framework. We want a stronger focus on outcomes, aligned with the Well-being of Future Generations (Wales) Act 2015 and our economic action plan. As part of this, we'll strengthen the role for Welsh regions in decision making. We're also looking outwards. Our work with the Organisation for Economic Co-operation and Development will ensure that international best practice on regional development and governance are built into our future plans.

So, in conclusion, we urgently need certainty around this funding. I hope a new Prime Minister will reconsider the UK Government's approach and respect devolution in actions as well as words. Our voice in those debates is louder when it is at one, and I therefore urge Members to support this motion.

Thank you. I have selected the amendment to the motion, and I call on Nick Ramsay to move the amendment, tabled in the name of Darren Millar. Nick Ramsay. 

Amendment 1—Darren Millar

Delete points 2 and 3.

Amendment 1 moved.

The Llywydd took the Chair.

Diolch, Dirprwy Lywydd, and can I thank the Minister for opening this debate? I'm pleased to contribute to it, and to agree, in fact, with many—though not all, as you would not be surprised to hear me say—of the points that have been made, but, nonetheless, many of the points you did make were something that, I think, we could all agree with, Minister, in terms of developing a system that is fair, that guarantees future funding to Wales, that mitigates some of the uncertainties of the Brexit process, of which we're all aware, and ultimately delivers effective funding for Wales that can be relied upon both by the Welsh Government and by the people of Wales and by businesses.

The motion recognises that Wales receives around £370 million every year in structural and investment funds as a result of the UK's membership of the EU and also calls on us to remember the promises made during the EU referendum that Wales would not lose a penny as a result of Wales leaving the EU. That is something we would all want to achieve. However you phrase it and whatever language you use, it's emotive saying about not losing a penny, but the point is well made that we were promised that Wales would financially not be worse off in terms of replacement European funding after the Brexit process is completed, and that's something that we on this side believe should happen. Wales should continue to receive the financial support that we need.

On the matter of the shared prosperity fund, which is explicitly mentioned within the motion, yes, of course we would all like to see more detail on that fund and at the earliest opportunity. That is, clearly, imperative. I do think, however, that to simply write the fund off in whatever form it may be at the moment, as this motion seems to try to do, is, I would say, unwise and unrealistic. It is at least an attempt to try and replace European funding with a mechanism that is fair and that not just supports—there's an attempt to do that—Wales and Scotland and the nations of the UK, but also the regions of the UK. I believe that was the original principle behind it. And as the Minister herself said, currently there are unanswered questions, which we would accept and I think that the UK Government would accept, which have yet to be ironed out, and only when those are ironed out and we can see the final form of that UK prosperity fund that we can say, 'Okay, it isn't going to deliver in the way that we want', or we'll be able to say that it does go a significant way along that course to delivering the sort of support that Wales needs.

In principle, it's a good idea, but it does have to be seen as compatible with devolution, and that was a point that the Minister made. I think, throughout all of this debate and discussion, we've had this ongoing argument about whether—. On the one hand, you've got a UK prosperity fund. How is that compatible with devolution? Is there some sort of rowing back of devolution? That was never the understanding at the start of this process, about how this would proceed, and that should certainly not be the case. The replacement of EU funds should not lead to a rowing back of devolution and of the powers of this Assembly. That was not what we anticipated and that was not what the people of Wales voted for.

Thank you for taking the intervention. In that case, why is it that you're proposing to reject paragraph 3 of the motion, which basically says to reject,

'the idea of a centralised UK-directed fund or one which seeks to bypass the devolved administration', because, effectively, you just said that you actually totally agree with that? So, why are you rejecting it?

[Inaudible.]—lawyer sometimes. Well, first of all, I don't like the tone of the motion. I think that if we all discussed—. I know you had a cosy discussion with Plaid Cymru about how the motion would be phrased and you're very happy with that, but I think that there was a wider agreement that could have been sought on that motion, actually, and I think we could have had a better tone. I've already said to the Minister that I think that whilst there are details of the shared prosperity fund that are still up in the air, some of them understandably so, then it is unfair to simply dismiss the whole fund at this point in time. I accept further down the line you may want to say it's not to be accepted and you can get rid of it, but at this point in time I don't think that point 3 should be there. In fact, we do accept point 4, which follows on from point 3—probably an obvious thing to point out to you—but point 4 does say that there is a need for equity. It does say—. I can see that Mick Antoniw is now reading that point 4. And you'll see that the points made in point 4 I think make the points of point 3 in a far more effective way and with a better tone, and that's why we voted to remove point 3. [Interruption.] Can I just make a little bit of progress? Then I'll let you in.

We're all agreed on the need for a fair settlement for the nations and regions of the entirety of the UK, addressing inequalities and underinvestment across the country. We also agree that the new arrangements need to respect devolution and ensure that Wales retains the autonomy to devolve and deliver successful arrangements for successor funds—the point that's made in point 4. I give way. 

Thank you for giving way, Nick. If I'm listening accurately to what you're saying, you are actually supporting at least the principle behind points No. 2 and No. 3, but you don't like the tone. The principle of No. is 2 about the lack of detail you've just spoken about more eloquently than I can; you also regret the lack of detail. And you do reject the idea of a centralised or UK-directed fund; you want it to be directed from here in Wales. So, can I just at least get clarity on the record that whilst you may not like the tone of something in here, you do accept the principle of the Government's motion?   

First of all, yes, there is a tone issue. With regard to point 2, it says, 

'Regrets the lack of detail from the UK Government'.

I've already said we want to see more detail, and that will be forthcoming. Okay. Leaving that aside, point 3

'Rejects the idea of a centralised or UK-directed fund or one which seeks to bypass the devolved administrations post-Brexit.'

We do not accept that there is an attempt to bypass. It's the language—you might say tone—that is unacceptable to us, because it is weighting the debate in a certain direction that we feel is not acceptable. And it would have been far better had we all agreed on the language of this motion, so that then we could have all accepted it. But point 4 is retained. [Interruption.] If I've got time, I will give way. I think they are making an important point, but it's a matter for the Llywydd. 

Indeed, and I welcome you giving way because it helps the debate. 

All I can say is the more interventions happen, the less likely some people are to be called later on in the debate.

And if I suffer, I'll accept it, Llywydd. 

It's simply to say you don't accept the idea that the UK Government in No. 3 is trying to avoid that. But the idea of a centralised or UK-directed fund, rejecting that—do you accept rejecting that? 

Just to be totally clear about this, I believe that point 3, and we believe that point 3, suggests that the UK Government is deliberately trying to bypass to claw back powers, which it is not. That that might actually—[Interruption.] That that result might actually be an unseen consequence longer down the line is something we can discuss, which is why I think point 4 is far more effective at making the point, but I don't think point 3 does. I realise I'm virtually out of time, so if I can just finish off. 

I totally agree—the 'leave' campaign are very vocal over there—with the 'leave' campaign's comments from before the referendum that Wales should not be a penny worse off after all this is done and dusted. Let's hope that that does actually turn out to be the case and it wasn't just words. I appreciate that there are some understandable reasons why we have this current confusion, but I think if we all work together here then we can deliver a message to the UK Government that I think we all find acceptable, and that will say that Wales does want to have autonomy, control and financial accountability here, and does not want to see that lost to the UK. 

A week or so before the referendum in 2016, a group of ‘leave’ campaigners signed a letter saying not that Wales should get the same amount of money after Brexit, but that money Wales currently gets from Brussels would be maintained by the UK Government after we left the EU. I'll be kind and rather than say they were lying—though others can come to their own conclusions—I'll say they were just making it up. You might recognise some of the signatories of that letter—Boris Johnson, Michael Gove and Dominic Raab were among them. Three years on, we still don't have a promise of funding for Wales post Brexit. Just like the evidence has been stacking up that Brexit would cause deep damage to Wales's economy, the UK Government has provide ample evidence that it just couldn't care less about what it means to Wales to be the recipient of EU funding according to need—something, of course, the outdated Barnett formula just doesn't do.

The Conservative manifesto in 2017 stated that they will use the structural fund money that comes back to the UK following Brexit to create a United Kingdom shared prosperity fund, specially designed to reduce inequalities between communities across our four nations. There would be a consultation and it would be completed before the end of 2018. A chance for us sceptics, perhaps, to challenge the UK Government, to push them on their promises. But we still have had no consultation. There are no promises anymore. No plan, no detail, no proposal. Earlier this year, I and my Plaid Cymru colleague Ben Lake MP published this report, 'Not a Penny Less'—our response to the shared prosperity fund consultation. It was a rather unusual thing to do, because we were responding to a consultation paper that hadn't even been published. But we had to.

The announcement of the shared prosperity fund had been welcomed back in 2017 by the then leader of the Conservatives in Wales, Andrew R.T. Davies, who can't be here this afternoon I'm told. It was hugely welcome he said, and further evidence that Wales would be better off out of the European Union. It's a strange kind of 'better off'. One of those romantic Brexity better offs, I guess, rather than better off as in we'd actually be better off—better funded, better placed economically. Because the evidence now is clear—[Interruption.] No, he said he couldn't be here this afternoon, so I'm pointing out that he's not here this afternoon. [Interruption.] I was talking about Andrew R.T. Davies, and explaining that he's not here this afternoon.

Talk about the shared prosperity fund.

The evidence now is clear. The risk is clear that Whitehall will just repeat its traditional formula of distribution of economic development funding. And look at what the figures published yesterday by the Communities in Charge organisation tell us about what that would mean. One of the campaign's organisers said it will be like handing every Londoner a cheque for over £200 and taking £700 from every Welsh person. Wales could lose over £2.3 billion over six years, with money flowing to the prosperous south-east of England. Now, rather than reduce inequalities, a business-as-usual UK Government would only increase the inequality between the regions of the UK and the nations of the UK. This is the Brexit reality, this is what faces Wales, and that's without taking into account the damage that would flow from the economic disaster of a 'no deal' Brexit.

Llywydd, the report that I've mentioned emphasises the value of European funds to Wales, in terms of skills, infrastructure and so on. We can't accept the loss of a penny if we leave the European Union. But at the moment, there is no certainty at all of that, and that, to me, is proof of how little priority the needs of Wales are given in all of that. We have a list of requirements. We need assurance that funding will be prioritised ahead of time, not through competitive bids. It has to be a multi-year scheme. It has to reflect the current situation, of course, where funding is allocated according to demand, not population. At the moment, Wales receives 22 per cent of structural funds from Europe. You hear our message—not a penny less.

But it's not just certainty about the amount of funding that we're seeking—this has been referred to already. We need certainty that it will be managed by Wales. We see already what can happen through the city deals and the regional deal for the north, for example. Of course I'm going to welcome any funding that will come from the Treasury to support developments in Wales, but what's happening is that Ministers in Whitehall want to manage and have the final word on expenditure. We need to respect the devolution settlement, and realise that it's here in Wales that these decisions should be made on setting priorities for creating a more vibrant Wales. And I'm sorry; the fact that the Conservatives in their amendment withdraw the clause that says we need to empower the devolved administrations says it all about the threats facing us.

I do want to support the Government motion, so I hoped I'd be able to make consensual comments, but I do have to say at the beginning that the Minister said that she wants to see promises from the 2016 referendum honoured. Yes, and how about we start by honouring the result of the referendum? She spoke about wanting to see legislation brought in for a referendum on our membership of the European Union, without drawing attention to the fact that we have had one. Wales voted to leave, and the problem is that she and the cohorts behind her think they know better than the people who, in the main, elect them, and don't want to implement the result. That is all there is to that point. The issues—[Interruption.] The issues we face—[Interruption.]

Can we allow the Member to continue with his contributions in some silence, please?

Having said those two initial points, I will seek to return the more consensual approach I had intended. I agree with the Government's motion. I think it's been worded with restraint and, generally, good sense. Point 1(a)—I do note the comparison that even if we accept that figure of £370 million a year, it compares to the amount that we pay over to the European Union. Now, of course, it can be either a gross figure, it can be a net figure, and there are various different sources through which we can estimate. But, even at the lower end of the estimates for the net contribution, we are looking at approximately £9 billion per year, and with the Welsh population accounting for 5 per cent approximately of the UK population, our share of that is a minimum of £450 million—i.e. more that we receive back even on these numbers.

Point 1(b) is quite correct that these promises were made. A particular letter was pointed out just now. I think, in the main, these promises were made by 'leave' campaigners, and not by the UK Government. It's an important distinction, and I think it is one that we should recall. However, what I would say is that many of the people who made those statements—and again, the Member mentioned, I think, Boris Johnson, Michael Gove and Dominic Raab—are currently running for the leadership of the Conservative Party, and therefore, at least potentially, Prime Minister of the United Kingdom. And I think one good thing, potentially, about the delay—. I agree and regret the lack of detail that we've seen on the shared prosperity fund, but I wonder if it's for the best, because what we saw was a remainer, Theresa May, take over the Government, put some leavers in particular posts as window dressing, so it looked like they were in charge of Brexit-related matters, but then negotiated something through a secret back channel, through civil servants, doing something completely different from what those Brexit Ministers thought they were leading. [Interruption.] Yes, I will give way. 

Thank you for taking an intervention. I must say I see it as another symptom about the lack of clarity about the direction of travel in which we're heading. One of the big issues that I have about the referendum in 2016 is that we still do not know what people voted for. You might have an idea; others in this room might have an idea. Again, after three years of failing to reach a conclusion on that, neither have we, after three years, reached a conclusion about how a shared prosperity fund could work. 

We voted to leave, and I'm sorry the Member no longer respects that. I note that his members didn't vote against triggering article 50, yet now try and undo the result.

However, what I do think, to develop the point I was making, is that if we see Boris Johnson, Michael Gove, Dominic Raab, or certainly if we see Boris Johnson or Michael Gove come in—sorry, not Michael Gove, but Dominic Raab—who have been very clear on this, is that hopefully these things can come back together, and the actual people who are making those promises, who are giving those commitments, will then be leading the Government of the United Kingdom and in a position to implement those commitments. And I think, therefore, it may be to the good that we haven't seen the detail in the shared prosperity fund, to the extent that we may now, before long, have a Government led by the people who are making those promises, from whom we can say, 'Well, look, this is what you told us back then; make sure that Wales gets what you promised.' Theresa May didn't look like she did want to deliver that. I hope that whoever wins this leadership election will want to deliver that. 

On point 1(c), I've seen, David Rees, that you've done quite a lot of publicising this all-party parliamentary group that Stephen Kinnock is leading. I don't know whether that's just because you share a constituency, or whether Stephen has got wider pick-up for this APPG. I hope to discuss it with him later in the week. But, certainly, I think it is encouraging that he's bringing people into this, and I hope Members from the Conservative side will also link into that APPG. Yes.

I thank the Member for taking an intervention. Just to clarify: my colleague Stephen Kinnock, who is my constituency MP as you pointed out, the APPG actually has cross-party membership—the SNP, Conservatives, various groups—and it is therefore a collective view, it's not just simply his view, and it is a view also of academics who have put in the research into the report. This is based upon academic research, and therefore clearly the report highlights the concerns that they have.

Good. Well, I wish it well and congratulate Stephen Kinnock on the work he's doing here, and also on the constancy of his position on Brexit. Unlike Members here, he hasn't changed it, and that I do welcome. I encourage the Conservative side as well, I hope, to link in to this APPG, to think where they can influence the debate as it's happening. There is a leadership contest. People are discussing issues. Let's try and make sure that UK Government policy links in with the Welsh Government policy on our getting the money that was promised.

I'm disappointed that the Conservatives are not supporting this motion today, because point 3, to me, I think, is actually well phrased. We don't want a centralised or UK-directed fund; we want one over which we have more influence than we did when it was run by the EU. We don't want to bypass the devolved administrations; we want to try and agree something that works for Wales and for the United Kingdom. I look forward to supporting the motion.

In terms of taking this debate forward, I don't actually dismiss the funding the way that the Member for Monmouthshire suggested in an earlier contribution, but what I do find deeply concerning is that we don't have any vision or identifiable ambition for this fund. Years after it's been announced, we don't know what the objectives of the fund are, except for a couple of sentences in the Conservatives' 2017 election. We don't know what's the funding that's going to be available, we don't know how that funding is going to be distributed, we don't know what measures will be used to distribute that funding, and we don't understand how devolution will be recognised and regarded, both in the development of policy and in the delivery of policy. That is an important part of this debate, because this debate tells us more about the United Kingdom than it tells us about past funding from the European Union. I will take an intervention.

I think there needs to be a reality check here. We should have had a withdrawal agreement approved by Parliament last autumn. That's obviously what the Government was aiming to do. We should have left in March and should now be in a transition period in which all the current payments would be guaranteed until the end of this cycle, and during this period we would have then constructed the shared prosperity fund, and the consultation would have occurred. It's all the people here who have either directly or through your support of your colleagues in Westminster prevented a withdrawal agreement getting through Parliament that have put us in this position. You can't discuss these really important issues that are a consequence of the withdrawal agreement and leaving before you've done that.

I have to say, Presiding Officer, I think it's extraordinary that the Government blames the opposition if they can't get their business done. That's the most absurd argument I've heard put down at any point in this place. And I will say this to David Melding as well: he did make a point earlier, during an intervention earlier, saying that he would be directed by Brussels—directed by Europe, I think he said—in terms of the structure of this funding. That is not true. It's simply not true. I remember as a Minister attending the General Affairs Council in Luxembourg when we had debates over these matters. I remember it was my officials that helped draw up parts of this legislation; that it was Welsh Government officials working with the UK Government, working with UKREP as well, that actually designed and developed this fund. There wasn't opaque policy making that took place either in the Treasury or Whitehall with occasional speeches from Ministers. The Welsh Government were a part of the development of the legislation and the policy that was given life by that legislation.

So, in terms of how we take this forward, for me, what is important is that we don't simply have devolution in the delivery of policy, but we have a recognition of a multimodal United Kingdom, if that's possible, in the development of policy. So it's Welsh Government officials, Welsh Government Ministers, working together with our colleagues in Scotland and with the United Kingdom Government in London, developing policy and developing what the fund should be, and to blame the opposition for that not happening, frankly, isn't a serious point.

But, what we have got, rather than that, is smoke and mirrors, and what we've got is obstruction of policy development taking place. And that is taking place from the UK and not elsewhere, because I hear the weasel words of UK Ministers saying that we will accrue additional powers following any Brexit, but they don't seem to understand or appreciate what that means for them and what that means for how they operate and how they develop their policy. I hope that we will be able to ensure that we do have a shared prosperity fund that reflects not the wishes of London, but the needs of the United Kingdom.

My final point is this: many of us will have seen numbers circulated on social media yesterday produced by the Huffington Post, which sought to provide an example, as far as I could see, of how different parts of the union would fare if this shared prosperity fund were to be distributed according to existing funding methodologies. And what was most shocking about these numbers wasn't simply the loss of funding for Wales and the net transfer of funds from Wales to the relatively wealthy parts of the United Kingdom, but that these funding transfers reflect current UK policy and the current UK approach, that funding flows from the poor to the rich, from the powerless to the powerful and from the periphery to the centre. What does this tell us about the current United Kingdom's view of the United Kingdom? If the UK is to mean anything, then it's to mean not simply a political union, but a union of social solidarity where resources are shared, where funds are distributed according to need and where there is a distribution and redistribution to those parts of the United Kingdom where those funds are needed. The United Kingdom Government does not seem to realise or understand this, and their proposals certainly do not recognise that.

So, in closing, Presiding Officer, let me say this: this certainly is a test and it certainly is a test for this Tory Government, but it's also a test, not simply of how they deliver economic development or a shared prosperity, it is a test of their future view of what the United Kingdom can be. Are we a family of nations where each one works with and respects the other? Or, are we simply to be told what to do and to be grateful for the crumbs we receive, promises or not? For me, the United Kingdom has to be that family of nations where we work together, where we respect each other. At the moment, it is clear that we do not have that from this current Government.

Too often in debates like this that focus on finances, we can get bogged down in the detail of percentages and far-off numbers that seem so remote that it's hard to track their relationship to people's lives. Actually, the proposals we're talking about, that is, how funds will be allocated post Brexit to help our communities, will have an indelible impact on people's lives. And, as is too often the case, it is the people who need the help most who stand to bear the brunt of whatever shocks our economy is subjected to.

One of the main criticisms of the 2016 referendum was that the 'remain' side failed to communicate the vast benefits that being a member of the EU offered us. Arguably, local authorities and other bodies, including maybe this place, had also, for years, failed to tell the story of how specific funds helped our communities. So, let's tell that story now. Let's spell out how structural funds benefit Wales and our citizens most in need of support. These vital funds are distributed based on need—a mechanism that seems anathema to the Westminster Government, who simply favour per head population as the only measure of distributing wealth. And the fund's aim is to tackle the injustices of poverty and social exclusion. 

The funds have supported numerous projects in Wales, such as STEMCymru 2, which supports young people in science, technology, engineering and mathematics subjects to encourage more young women to pursue engineering. And the Parents, Childcare and Employment programme, which helps unemployed parents into work or training by helping them with their childcare costs. The Workways+ programme, meanwhile, helps those over 25 without a job into employment. These programmes provide a lifeline for people when they need it most. The shared prosperity fund has to honour the protections offered by the current system, and it has to be distributed based on similar principles. Prosperity is not only about finances; of course that is the central plank, but it's also about ensuring well-being and addressing structural differences that underpin the inequity of inequality in our society.

We know this bit of the story, at least: Wales gets a higher portion of structural funds per head than the rest of the UK. In fact, we in Wales receive six times the amount of EU funding per capita than England. That translates as £230 per head on average in Wales, compared with £85 per head in England. But Chwarae Teg have pointed out that it is women who will be most adversely affected if these funds are removed, as well as other minority groups, disabled people, and people from BAME communities. These are the groups who benefit at the moment from programmes funded by the EU, like those I just mentioned. It is them who we should be thinking about in this debate.

The UK Government has conducted an equality impact assessment of the potential impacts of Brexit, but it isn't specific to Wales. We need a Wales-specific audit of the likely impact of Brexit—particularly, now, a hard Brexit—on our economy. Again, the EU has a strong record of protecting sections of society most in need of protection, not just through administering funds, but also through legislating for gender equality, human rights, and workers' rights. Westminster has given no guarantee that it will protect all of these rights. Removing ourselves from this system in these circumstances would be like taking away the scaffolding surrounding a house when the foundations haven't been fixed. Nothing will be there to stop us crumbling to the ground.

The UK Government has promised 'Not a penny less' for our communities; I'm sure that phrase will haunt them, but we must not let them forget it.

Strangely, I speak today in two capacities, both as Chair of the external affairs committee, which has looked very carefully at this, but also as a constituency Member whose constituency has benefited from the funds from Europe. I'll start by reflecting on that last point, particularly on the contribution by Delyth Jewell, because we often talk about European funding on buildings and roads and structures, but the real benefits of European funding have been the programmes that we've seen operating in our own constituencies, in the disadvantaged communities, helping people gain qualifications, move on with skills, move into employment, full-time or part-time, to be able to build their lives. That's the real benefit we've seen with these funds, and very often those programmes are forgotten when we talk about structural funds.

The motion rightly notes that we receive £370 million a year, and can I remind Mark Reckless that the structural funds don't refer to anything on the agricultural side? So, when you quoted your figure, we were actually benefiters not losers on this, as a consequence of funding to European—[Interruption.] Of course I will.

What about all the extra money that Welsh residents pay in terms of the higher prices for food he mentioned, but also, indeed, for clothing and footwear?

Here we go again. I don't want to get into an argument about World Trade Organization rules, but you know full well that if we enter WTO rules, the cost for goods that people have to pay will go up very high, and that is something my constituents don't wish to pay. But never mind; we're not talking about those. We are actually talking about structural funds, so let's go back to the topic that we are actually here to talk about.

We can't forget, during the 2016 referendum—and we have to keep reminding everybody—about the comments being made that we would not be a penny worse off, because it's our duty to represent our constituents and to make sure that those who make the promise keep the promise, and those who are promoting 'leave' make sure we are not a penny poorer and that we do not lose any powers. It's their responsibility to do that, and it's our responsibility to remind them. Anyone who says 'leave', they need to remember that.

But can I also remind people, actually, of the socioeconomic imperative of the work the European funding aims to achieve? That's lifting the economic performance of the most deprived areas up to the best standards across Europe. We must continue that after we leave the European Union, and therefore we must ensure that we continue the proper funding. And when I talk about funding—. We mentioned the European funding. I think Rhun mentioned about the money—it was quoted that the amount we get from Europe goes into the shared prosperity fund. Let's not forget the contribution the UK makes in that funding as well; we can't lose sight of that, because as councils across England—. In fact, I got a response from Cornwall Council today to our request on shared prosperity, and they remind us, not just the European funding but the UK contribution that would go along with that, the match funding, also has to go into that shared prosperity fund, so that we do not lose any aspects of that funding.

The committee outlined its work on structural funds and the clear risks of allocating future funding on the basis of anything that is called, like, Barnett, as a possibility. No, we need, as has been pointed out, a needs-based approach. We cannot do anything other than that, because that is the reason that this funding is there, the needs of our communities, and that must continue to be addressed.

Now, it's been mentioned in this report—and I've got a copy, if anyone wants a copy—it also reflects everything we said in our committee. That report makes 18 recommendations, which basically back up what we've been saying about how this fund must address the needs of the nations and regions across the UK. We can't ignore the fact that this is not just Wales—this affects places like Cornwall and the Scilly Isles and it affects the north-west of England; it affects Northern Ireland and it affects Scotland. We must ensure that this fund is fair and is agreed by the nations and regions. And that's one problem we have to address. At the moment, we don't know the detail, as Nick Ramsay said—we don't know the detail, we haven't got any information on it, but we do need to ensure that any decision on the fund has to be agreed by the nations. And Alun is quite right: this is about nations working together and not about being instructed by Westminster.

Now, we also want the Welsh Government to contain oversight of these funds and therefore meet the purposes of what we need, but, of course, that means putting budgets down to local authorities as well, because they are closer to the ground. It's about working in partnership—something that I think has been shown to be excellent in Wales in this European funding approach. The partnership between Welsh Government and local government, and deciding how those budgets have worked, has been excellent and we need to ensure that continues and is not interfered with by criteria set by Westminster and Whitehall, and that we continue to ensure that the criteria are fitting for Wales and that the decisions are made here in Wales and that funding is allocated.

Llywydd, we're one of the most unequal countries in Europe. Actually, the GDP graph between Wales and London makes us the most unbalanced member state in the EU in terms of regional economic disparities. And, really, actually, if you think about it, that's a shocking statistic—that we're one of the most prosperous countries and yet we're one of the most unbalanced countries in the EU. The gap between the richest, which is actually in central London, and the poorest, which is actually one of us, is bigger than it is anywhere else in the EU. So, we need to address that and this is what it was, and London must understand that it cannot ignore the need to address that gap. It can't dictate and it can't ensure that that money is shared amongst its friends in the more rural constituencies of England; it actually has to address the needs of the communities we represent.

Llywydd, I see that my time is almost up, but I just want to remind everyone of one thing. Please, to the members of the opposition, when you talk to your colleagues in London, remind them that this fund is about making sure that we all are able to be prosperous. And it should be reflected and it should allow for the needs of Wales to be decided in Wales and not in Westminster. To the rest of us: hold them to account because they're the ones that are making the decisions in Whitehall. We've got to make sure that Boris, Dominic, Michael—whoever gets in—honour the commitments that were made to the people of Wales and that we will not be a penny worse off and that we will not lose a single power. That's the job we have to do. 

I was eager, as Chair of the Finance Committee, to make a contribution to this debate and to point to the work that the committee has done on this issue, because last year the Finance Committee undertook an inquiry to assess the preparations for replacing EU funding in Wales, as we were concerned, as were a number of Assembly Members, that very little information was known about how funding would be replaced. Now, as a committee we supported the Welsh Government’s position that Wales should not be a penny worse off after Brexit, of course, and that securing post-Brexit funding would be essential for Wales.

Wales currently receives, as we have heard, by far the highest amount of EU funding per head of population of the devolved nations and English regions. It was clear from the evidence that we received during our inquiry that, unless funding continues on a needs-based basis, Wales will be severely impacted. We concluded that it is vital that Wales should continue to receive at least the funding equivalent to the amount it would have received through EU sources had the UK not voted to leave the EU. Equally as important, of course, is to ensure that funding continues to be managed and administered in Wales—that is just as important in the committee's opinion.

At the time of our inquiry, the UK Government had announced that structural funds would be replaced by a UK shared prosperity fund, but very little detail was available on how this fund would operate. We invited the Secretary of State for Wales, therefore, to attend an evidence session with the committee, but as you are aware, of course, he declined that opportunity. We were disappointed with the lack of engagement from the UK Government, and that key decisions around how funding would be allocated to devolved administrations have yet to be agreed.

In response to our report as a committee, when we published our report, the Secretary of State said that the UK Government was intending to consult on the shared prosperity fund by the end of 2018. So, it's very disappointing, and it says it all, in my opinion, that this still has not happened.

Two things happened this week that should give everyone pause for thought when it comes to the prospect of a shared prosperity fund designed by this current UK Government. The first is the report from Communities in Charge, already referred to by my colleague Alun Davies. Those stark figures—a £200 cheque for every Londoner, a £700 bill for every Welsh person—show what awaits this country from a Whitehall-managed scheme. The fact that these numbers are based on current economic development spending by the UK Government merely underlines how far we are away in Wales from getting a fair deal from the Tories. You can be sure that if the deal is bad for Wales it will be worse still for the south Wales Valleys, the area that benefits most from current structural funds.

The second development, which happened almost simultaneously to the Communities in Charge publication, was the decision of the Secretary of State for Wales to back Boris Johnson in the Tory leadership campaign. Now, we can argue that this contest shouldn't matter to the debate, but it does. It matters hugely. The person who has asked us to trust him to be Wales's voice at the Cabinet table made his decision on who to support after Boris supported tax cuts for the better off, a move that would see nearly £200 million put into the pockets of the richest people in Wales, whilst nearly £500 million would be lost for Welsh schools and hospitals. Does that really sound like someone looking after Wales's interests? Tax cuts for the wealthy is anathema to the aims of the European structural fund programme, which is about economic solidarity and support for those who need it most.

So, it is the Secretary of State, who has already overseen the loss of the tidal lagoon, rail electrification and Wylfa Newydd, who is asking us to trust him to deliver a shared prosperity fund that will be fair for Wales—a Secretary of State who would rather back Bristol Airport than Cardiff, and who claims we should look on economic development spending in England as a godsend for Wales. There is nothing in the track record of this UK Government that gives credence to their claims that devolution will be respected in the development of a new fund. It has from the start been a naked power grab by the Secretaries of State in Wales and Scotland in a desperate bid to exercise relevance in a world that has passed them by.

We are not talking about a shared prosperity fund, we are talking about a shambolic, preposterous fraud. Indeed, the only rationale on which a new, centralised scheme is being defended by the Tories is what they see as inefficiency in how the latest rounds of European funding have been spent, and yet the evidence to the contrary is here for all to see.

Will you take an intervention?

Very quickly.

Thank you. You made reference to the evidence—would you accept that the evidence about the way that your Government has carved up the spending of public resources in Wales is also very much wanting? If you look at the local authority settlements, for example, across this country over the past decade, you'll find that north Wales has lost out significantly when compared to local authorities in the south, and much of that resource has been invested in Labour-run local authorities, rather than fairly across the country. 

Well, this isn't a debate about the local government formula. Decisions taken by this Government have been as a result of Tory austerity. And as I was saying about European funding, it has created 48,000 new jobs and 13,000 new businesses, 25,000 businesses assisted with funding or support, and 86,000 people helped into employment. There were no regulatory obstacles that stopped the electrification of the Swansea line, yet the UK Government couldn't deliver it. There were plenty of challenges in delivering the new £300 million Swansea University campus, yet partners in Wales worked together to deliver it using vital EU funds. The Tories say that European funding doesn't sufficiently support poorer communities outside of west Wales and the Valleys, as though this was a zero-sum game. Well, if there are areas that they think need more support, there are no obstacles to them providing additional resources for the whole of Wales, and yet they have chosen to do the opposite. The truth when it comes to structural funding, as with many other Brexit-related promises, is that the people of Wales were lied to by the 'leave' campaign. Far from taking back control of regional funding, Welsh communities will be losing control of how that money is spent.

Any objective view agrees on what should happen next. Preparations are well under way in Wales to build on the current funding programmes, involving businesses, the third sector and local government. Reports from, amongst others, the Federation of Small Businesses, the Joseph Rowntree Foundation and the IPPR all make it clear that a replacement funding programme must be delivered locally where the expertise and understanding already exist. At no stage of the process has the UK Government engaged meaningfully with these partners. Yet again, devolved administrations are being locked out from decisions they are best placed to shape and deliver than most Whitehall departments who have only a scant understanding of delivery, subsidiarity and regional policy.

The shared prosperity fund promises to be just another example in a growing list of economic and social disasters visited upon Wales by the unholy mix of a shambolic Tory Government and a Brexit vote built on deceit.

It's a pleasure to speak in support of the motion tabled in front of us today because this topic is a really important one, both practically and in principle—practically as this concerns the replacement of funding worth £370 million to Wales annually, funding that has been used to create tens of thousands of new jobs in Wales, to assist and establish tens of thousands of businesses, to help Welsh people like the people I represent in Cynon Valley gain hundreds of thousands of new qualifications, making big differences across Wales and in constituencies like mine, changing lives, giving new opportunities and supporting those who need it most. This motion is also important in principle as it gets to the heart of the devolution settlement. The UK Government's failure to confirm that Wales will get the say over how any funding is allocated and spent ignores the reality of devolution. It is crass, insensitive and fails to recognise the very different policy direction that we have taken here in Wales.

Here in Wales, we have a focus on future generations and a holistic economic approach, which contrasts sharply with the scorched earth austerity obsession of Tory Westminster politicians. But it's not just about Wales. As other contributors have suggested, this approach really shows a tin-eared lack of understanding of sensitivities in Scotland and Northern Ireland too. The all-party parliamentary group on post-Brexit funding for regions, nations and local areas noted in their inquiry into the shared prosperity fund that there is no compelling reason why the UK Government should earmark how money is spent in the devolved nations. The allocation of funding should be a devolved matter for the devolved nations. Importantly, this was the overwhelming consensus of contributors to the APPG inquiry. I wholeheartedly agree with these findings, and I'm glad that the motion makes reference to this.

Earlier in the year, the cross-party group on industrial communities, of which I am the chair, had the chance to consider in detail the APPG investigation into the shared prosperity fund. Indeed, their report had been shaped by the experiences of stakeholders who are delivering current EU programmes, drawing on their expertise and best practice to identify how any fund should work going forward, and that report contains clear red lines. Wales should not receive a penny less in post-Brexit funding; any money or power grab from Westminster must be resisted. We heard a woeful litany of delays, obfuscations and refusals to meet, but the APPG's report clearly provides a useful framework going forward and, moreover, one that enjoys cross-party support in Westminster. In that vein, I also welcome that today's motion is a genuinely collaborative one. This is an issue where we all need to sing with one voice. Several important points are made in the report here—which I would urge all Members to read, if they haven't done so already—by Professor Steven Fothergill, who is the national director of the Industrial Communities Alliance. Professor Fothergill looked into likely outcomes, and reiterated that any future funding should be no less, in real terms, than current funding streams, existing shares between the four nations should be maintained, and any fund should operate on the basis of multi-annual allocations, with devolved management and setting of priorities. The workings of any fund, he said, could offer a real chance to meet the needs of left-behind communities. But, for that to happen, the UK Government must be transparent and not be afraid to recognise the devolved reality of the UK.

That CPG meeting was well attended by a range of stakeholders, many of whom had submitted evidence to the APPG's inquiry. And that turnout showed to me just how important and emotive a topic the future of the shared prosperity fund is. Similarly, the points made by stakeholders must be addressed as plans for a fund develop. For example, concerns were raised that the proposals emerging very much reflected governance structures in England alone. Partnership arrangements need to be robust, and any mechanism must ensure inclusivity and equality of outcome. There could be opportunities in terms of regionalising funds within Wales. Funds should be outside of the Barnett formula, and any allocations made have to be underpinned with primary legislation. All in all, those present at that meeting heard of the importance of a consistent response from Wales, to ensure that we do not lose out. Today's motion is a final part of that process.

As I conclude, I want to reiterate the scale of the challenge. If we are under any illusion as to how critical that is, the statistics in that Communities in Charge report that was issued yesterday set that out so starkly for us. If we don't make our arguments successfully, if we fail to build our case, Wales could lose in funding the equivalent of £743.11 for every citizen. And that is something that we simply cannot accept.

The Minister for finance to reply to the debate. Rebecca Evans.

Diolch, Llywydd. I'm very grateful to all Members for their contributions in the debate today. I always look to find consensus where I can find it, and I do think that there was some of that demonstrated in the debate that we've had this afternoon. One of the themes, I think, that came through really strongly was just simply the scarcity of information that we do have about the UK shared prosperity fund. It featured in the Conservative manifesto, back in the first half of 2017, but since then we have had no real tangible information. Despite repeated questions to the Prime Minister, the Secretary of State for Housing, Communities and Local Government, and also, of course, to the Secretary of State for Wales, we still have no further detail. Whilst the oft-repeated promises to respect devolution settlements and engage with the devolved administrations on the development of a shared prosperity fund were very welcome, they haven't been followed up by any meaningful action. We are aware that there's a draft consultation document in existence, but we are being refused sight of it, or refused any input into it. And I think, unless that document is explicitly limited to England, then this process certainly doesn't respect devolution, because we are a Parliament, and we are a Government, and we are not consultees in any consultation that the UK Government might bring forward in due course.

We're speaking to colleagues at both ministerial and official level about the shared prosperity fund, but those conversations, again, are very much one way. We're very clear about what we want, but the UK Government is being deliberately vague, I think, in terms of what their plans are. Much of what we think that we know about the shared prosperity fund is therefore conjecture and rumour, but some of the fears that the UK Government is seeking a new role in steering funding appear to be confirmed in some of the recent statements by UK Government Ministers. For example, Michael Gove recently expressed frustration at the Scottish Conservative conference when he said that the UK Government cannot direct some funding in devolved nations where it involves areas of devolved policy. Well, of course they can't—that's the devolved nations' administrations' job. But he was frustrated by that. And, of course, we know the Secretary of State for Wales is desperately trying to find a role for himself, and he is eyeing up the shared prosperity fund in that regard.

There are some inherent contradictions in terms of the UK Government's position on the shared prosperity fund. It can't be respecting devolution if the UK Government intends to dictate the terms of funding, have a key role in the Welsh economic policy and seek to bypass the Welsh Government. The city deals, for example, have been mooted as one example of the way in which the shared prosperity fund could work. Well, of course the city deals have provided some welcome additional investment in Wales, but they're certainly not a model for the replacement of EU funds and not for supporting the regional economic development policy that we describe through our economic action plan. So, a really simple confirmation that the Welsh Government will retain autonomy over where and how to spend future regional funding is required, together with the opening of detailed discussions on the funding settlement for each nation of the UK and an opportunity to discuss the areas in which Wales may want to co-ordinate or collaborate.

Because, turning to inter-governmental relations, the fact that longstanding—

Will the Minister give way?

Yes, of course.

It's an appropriate point to remember something that Vikki Howells said—I think it was Vikki—in her contribution—that there might be big concerns about the shared prosperity fund, but there are also issues about Barnettisation of funding coming to Wales as well. So, would you agree with me that we have got to make sure, when detail does become more clear around the prosperity fund, that money that does come to Wales, if it is to be used by the Welsh Government, doesn't go through the Barnettisation process, which, in the past, has short-changed Wales for many, many years?

I absolutely agree with you and I'm glad that you feel that way as well. I really would urge you to be making those representations to the candidates for the new leader of the Conservative Party. Because I'm sure that—. Well, we're certainly on the same page and I would hope that they would be as well. And I do intend to come back to address some of the comments in relation to the Communities in Charge report, which a number of Members have alluded to.

But I did want to talk a little bit about inter-governmental relations. The working conventions that we've established are being ignored and that's particularly troubling, given the absolute need for increased co-operation between administrations in the context of Brexit. The UK Government's approach to replacing structural funds is really at odds with and is undermining the good work that actually is generally happening across the UK to strengthen inter-governmental working in a wide range of areas as we approach Brexit. And we've repeatedly emphasised that, if we are involved meaningfully and in a spirit of mutual respect, then UK Government will find us absolutely constructive partners. We've done a huge body of work that we can share with them. Unfortunately, as yet, our offer has not been taken up.

We've been clear that economic development is a devolved competence, with the administration of regional funding having been under Welsh Government control since devolution. And respecting that competence implies the need for each nation within the UK to be allowed to put in place its own arrangements. And it's simply inappropriate for the UK Government to be considering setting priorities or dictating delivery approaches for this funding in Wales.

Should the UK Government be intent on pursuing a UK-wide consultation on the shared prosperity fund, then we would obviously expect any reference to Wales to be discussed and agreed with us in advance, as allocations or governance arrangements within Wales are a matter for the Welsh Government, in discussion with our partners here in Wales. We do, however, recognise that there may be benefit in co-ordinating approaches across the UK, but that has to be done on the basis of the devolved nations being treated as equal partners, with any agreements reached through negotiation and not imposed unilaterally. For example, recognising the interconnectedness of our economies, we've indicated that we are supportive of a new approach to regional investment that would enable cross-border investments between Wales and England. However, those investments would need to reflect Welsh Government policy priorities and produce tangible benefits for Wales. And having control over funding that we've had since devolution is not about isolationism. Closer working with the English regions will be vital, and greater flexibility in how we use replacement funding will help us to do this more effectively.

But I just will briefly touch on the Communities in Charge report, which a number of Members have referred to, and that showed that, if allocations for future funding are based on Barnett, then Wales would lose out significantly from these vital funds to support our businesses, people and communities, and, of course, London would gain. The figures are familiar to us now—so, Wales would lose out on more than £700 per person, London would gain £200 per person, and, in total, Wales would lose out £2.23 billion. But I think a staggering fact that nobody has mentioned yet in the debate that comes through that report is that, of the other six areas that lose out, Wales loses more than all of them combined. 

The long-term challenges that we face are reflected in those stark regional disparities so evidenced across the UK, and those don't disappear with Brexit. Perhaps if we just look briefly as I close at what we could have had, based on Eurostat figures, if there was no Brexit the UK share of European structural and investment funds would have increased, given the fact that gross domestic product has fallen relative to the EU average on the Tories' watch, and more regions in the UK would qualify as less developed. And, if there was no Brexit, an analysis by the Conference of Peripheral Maritime Regions of Europe estimates that the UK share of ESI funds would have increased by 22 per cent, given the poor performance of the UK relative to the EU average. And, if Wales maintained the same share of that pot, it could equate to an additional £450 million over the scheme period, or some £65 million extra a year for Wales. So, we'll continue to press the UK Government to ensure that promises made that Wales would not be worse off outside the EU—we'll make sure that those promises are kept.

I'm grateful, as I say, to all Members for their contributions. I hope that their support for the content, if not the tone, of the debate will allow us to send a united message to the UK Government and the incoming Prime Minister that what we need is an approach that is fair to Wales, that respects devolution and that keeps the promises that were made.  

The proposal is to agree amendment 1. Does any Member object? [Objection.] I defer voting until voting time.

Voting deferred until voting time.