Shared Prosperity Fund: Devolved Administrations

Ben Lake Excerpts

Tuesday 1st March 2022 Westminster Hall

[Ben Lake (Ceredigion) (PC)]

It is a pleasure to serve under your chairmanship, Sir Edward. I will begin by thanking the hon. Member for Belfast South (Claire Hanna) for securing this debate and for the welcome opportunity to discuss the shared prosperity fund’s governance and scale, as well as the promises that were made to the devolved nations. Levelling up is an economic necessity, and for decades Plaid Cymru has drawn attention to the chasms that separate our nations in economic development, social opportunity and political attention. That is why, although I applauded the long-term vision contained in the levelling-up White Paper, I am concerned that it lacks the requisite funding and structural reform necessary to realise that vision. Quite simply, we need to get the shared prosperity fund right—a task that has been made even more difficult by a less than auspicious start. The Government dragged their heels in publicising the detail and in implementing the fund itself, and we now know that it also represents a broken manifesto promise, at least as it relates to Wales. On page 15 of the Welsh Conservative manifesto, the party committed

“to ensure that no part of the UK loses out from the withdrawal of EU funding”.

The Welsh Government have recently calculated that the Welsh budget will instead be £1 billion worse off by the year 2024 than if we had continued to receive EU funding through the structural funds. If we look to the EU and its €750 billion covid recovery fund, or to Germany’s historic €2 trillion, or £71 billion annual, investment in east Germany, we have an idea of the scale of the funding that levelling up truly requires.

I urge the Government, in the light of some of those examples, to raise their ambitions when it comes to levelling up—to levelling up levelling up, even—and to perhaps look at committing 1% of GDP over the coming decade, equivalent to some £22 billion annually, to the shared prosperity fund and the task of levelling up the nations and regions of the United Kingdom.

Sadly, in terms of governance, the UK Government are already repeating past mistakes by adopting the same centralised Whitehall model that created many of the regional inequalities in the first place. The shared prosperity fund must be administered by each nation, rather than being disbursed in a fashion that turns nations and regions against each other. Not only is that inefficient but it undermines devolved responsibilities for economic development, a point made by my hon. Friend the Member for Carmarthen East and Dinefwr (Jonathan Edwards).

The shared prosperity fund must be better resourced and must work with rather than over the devolved nations. Anything else would be further proof that Westminster does not work for Wales. It would also call into question whether it works for the persistence of this Union.