1. What assessment has the Welsh Government made of the funding Wales will receive from the UK Government to replace European Union funding? OQ57608

Llywydd, Wales will receive substantially less funding from the UK Government in comparison with what we have received from the European Union and would have received under the current round of structural funding. The absolute guarantee that Wales would be not a penny worse off has been comprehensively broken and abandoned.

Diolch, First Minister. The UK Tory Government has finally admitted that it will not fully replace EU funding to Wales for three years, this despite Boris saying constantly that the people of Wales would not be a penny poorer when the UK left the European Union. Boris economical with the truth—who would have thought it? While the Welsh people stand to lose £1 billion a year, Boris and his Tory Government are letting fraudsters walk away scot-free with public money—£4.3 billion-worth of funds fraudulently obtained through coronavirus help schemes, crony contracts have been just written off by the Tories. First Minister, the Western Mail commented in its editorial last week,

'Once again, it's our poorest communities that are most likely to miss out'.

Those poorer communities are communities such as Risca, Newbridge and Crosskeys—the tapestry of towns that make up the constituency of Islwyn. First Minister, what can the Welsh Labour Government do to stand up for Islwyn and stand up for Wales, on the side of the Welsh people, while the UK Tory Government sides with their fraudster friends?

Llywydd, I think it is just worth reminding everybody what the Conservative Party said in their manifesto at the general election of December 2019, and which was repeated by them in the comprehensive spending review announcements of October last year. This is what they said:

'The UK Shared Prosperity Fund will at a minimum'

—at a minimum, Llywydd—

'match the size of EU Funds in all nations, and Cornwall, each year.'

Well, Wales would have received £375 million in funding in this calendar year from European structural funds. What will we actually get? Forty-seven million pounds. How does anybody, Llywydd, believe that £47 million, when we would have received £375 million, represents, at a minimum, matching the size of EU funds each year? And, of course, Rhianon Passmore is right that that promise, that absolute guarantee, as we were told in the Chamber here, has simply been abandoned. The UK Government now says that it will count towards the money that they will give us, money we have already got from the European Union. Now, I'm not saying anything about fraudulent use of money, but I'm absolutely saying that that argument is fraudulent—the argument that you can count money you've already got towards money that they promised they would give us is simply not to accurately describe what is going on here.

Now, what will the Welsh Government do? Well, Llywydd, what we will definitely do is to continue to uphold different standards here in Wales than we have seen across our border. Members here will remember that, in April of last year, the auditor general published a comprehensive report into the provision and the procurement of PPE, here in Wales. The report said that it had showed how in Wales we had been able to avoid the problems reported in England. Well, on top of the £4.3 million lost in fraud from business funds—remember what Lord Agnew said:

'a "lamentable", "woeful", "desperately inadequate" refusal by the UK Government to tackle fraud'— last week, the National Audit Office in England published its report on PPE procurement in England. The comptroller general said that he had not been able to obtain an assurance that, of the nearly £9 billion that had been lost on PPE in England, there had not been a material level of that loss that was down to fraud. Well, there you have it, Llywydd: a very, very direct comparison of the way things have been done in Wales. That money then available for us to invest in supporting businesses, in supporting the communities in the Islwyn constituency, compared to the ways things have been done across our border. 

First Minister, I agree that it's crucial that Wales doesn't receive less funding than it had when we were in the European Union. And, as Chair of the Economy, Trade and Rural Affairs Committee, I can assure you that we will be scrutinising this issue very carefully in the next weeks and months. Now, last month, it was announced that new structures would be put in place between the Governments of the United Kingdom to discuss issues that affect people across the UK, particularly where they cut across the various policies of the different Parliaments. So, First Minister, can you tell us what role these structures could play in ensuring that Wales does receive the right level of financial support once EU funding comes to an end? 

Well, Llywydd, thank you very much to Paul Davies for what he said, as Chair of the committee, and I look forward to the work that the committee will be doing to assist all of us to make the case to the Treasury to do what the Conservatives said in their manifesto during the general election. I don't think that there is any doubt now that they have rolled back from what they promised, and the work of the committee will be a help, I'm sure, to make the case again to the UK Government to fund Wales as they had said they would.

So, there is a new system that has come into force to help us to discuss issues across the United Kingdom. That hasn't happened yet, and, of course, things that have happened in Northern Ireland over the past week complicate the arrangements for these discussions as regards not having Northern Ireland present around the table. I look forward to seeing when the first meeting of this new system will be arranged, because that will be an opportunity for us to make the points that I have made today, and that Ministers in the Welsh Government make every time we can, to Ministers on a UK Government level.  

The levelling-up fund White Paper makes for an interesting read, doesn't it, First Minister, with references to Renaissance Florence, Jericho's Byzantine empire, if nothing else, but it also references the levelling-up that happened in Germany after reunification, explaining that £1.7 trillion was spent there up to 2014, being £71 billion a year over 24 years. The levelling-up and shared prosperity funds combined don't provide for even 10 per cent of that level of funding. As you've just been setting out, First Minister, Wales will be £1 billion worse off under these plans than if we'd not left the EU, despite the promises from the Tories that we wouldn't be a penny worse off. But, as well as that, it's the question of how these funds are spent. Gone will be the strategic oversight we had with Welsh European Funding Office and in its place comes a pork-barrel process, with councils pitted against each other in a battle to get funds from Westminster. So, First Minister, do you agree with me that the levelling-up agenda is nothing more than political spin, when the Tories are in fact reducing the level of structural funding and depriving us of the ability to spend it strategically?

Well, Llywydd, I think Delyth Jewell has made those points very forcefully and I agree with them all. The 'Levelling Up' White Paper is a friendless document, even by the Secretary of State whose name is on the cover. Its attempt to range far and wide across the mists of time is simply, I think, an indication of the lack of real content that there was there for this, despite the fact that this levelling-up fund, the shared prosperity fund, has been trailed by the Conservative Party since 2017. They have had years in which they could have produced something that matched their promises. What we have instead is a very thin document indeed—thin on money because the Treasury refused to provide the necessary funds to back it up, and very thin indeed in response to its claims that it is about transferring power and decision making beyond Whitehall because, as Delyth Jewell said, every single decision made about how money is to be spent in Wales will be made in Westminster, nowhere else. And that competitive way of pitting one part of Wales against another in order to bid for what is left on the table in this fund is guaranteed to mean that the money is not well spent. There will be no strategic plan behind it. It will be a series of minor dollops of money handed out on a basis in which it is very hard often to find any genuine rationale, and with no sense at all about how any long-term impact from that investment is to be secured for the Welsh public.