The UK Government is seeking bids from mayoral strategic authorities in England to take control of rail in their areas
The UK Government is seeking to devolve rail powers to mayoral regions in England while steadfastly rejecting calls for rail infrastructure to be devolved to Wales.
Following the English Devolution White Paper, the Westminster Government is now inviting mayoral strategic authorities (MSAs) to apply for full statutory and financial responsibility for local rail services, infrastructure and/or control of stations.
The UK Government said that MSAs can seek full devolution of rail responsibilities under existing legislation such as the Railways Act 1993.
The proposed new publicly- owned body that will oversee both rail services and infrastructure, Great British Railways (GBR), will retain overarching responsibility for delivery, but will work in close collaboration with MSAs to “enable local input within an integrated railway system.”
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In its guidance for a planned major expansion of devolving rail powers in England, the the Department for Transport (DfT) adds: “Devolution is a positive feature of the railway landscape in England, with significant responsibilities already fully devolved to the mayors of London and the Liverpool City Region.”
The Welsh Government, prior to last year’s General Election, while continuing to call for the devolution of rail, adopted a longer-term view by describing the aim as a “process rather than an event”.
In the summer, Rachel Reeves, in her spending review covering the period up to 2029/30, announced £34bn for rail enhancement projects in England. For Wales, the Chancellor announced £455m.
However, when stripping out £90m to develop new rail projects, £77m towards the upgrade of Cardiff Central station – which at the time had already been announced subject to business case sign-off, which came earlier this month – and funding for upgrading the relief lines on the South Wales Mainline, this leaves around £300m for rail enhancement projects in Wales over the period. This represents a ratio of roughly 100:1 compared with England, despite Wales having just under 10% of the rail network in England and Wales.
Through the Barnett Formula, the Welsh Government previously received a budget transfer based on changes to the Department for Transport (DfT) budget, using a comparability factor of around 90%, against a UK population share of about 5%.
That transfer was based on changes to the overall DfT budget. The comparability factor was high because non-devolved items made up a very small part of the department’s spending and Network Rail expenditure was excluded. However, with HS2 and Network Rail spending now included – and representing a much larger share of the DfT budget – the comparability factor for Wales has fallen to 33.5%. This squeeze does not impacted Scotland and Northern Ireland, where comparability remains close to 100% (95.6%).
The Welsh Government would not entertain taking on devolved responsibility for rail unless it was underpinned by a fair block grant adjustment, and one that recognises years of underinvestment in the Welsh rail network. It would also require agreement that the UK Government, with its stronger fiscal position, retains a degree of liability for unforeseen events such as landslides.
Part of the rail network in Wales, the Core Valley Lines were a £1bn electrification programme is close to completion. is already devolved and owned by the Welsh Government via Transport for Wales . However, the comparability factor has not been adjusted in the Welsh Government’s favour by the UK Treasury to reflect its ownership of the Core Valley Lines network.
Under the proposed legislation for GBR, unlike the arrangements in Scotland, there is no statutory underpinning for Wales, only a memorandum of understanding between Welsh and UK government ministers.
Both Plaid Cymru and the Liberal Democrats have said they cannot support the legislation as it stands, arguing that the only way to address rail underfunding in Wales is through full devolution. Plaid Cymru’s transport spokesperson at Westminster, Ann Davies, said that while the bill may simplify rail operations in England, it fails to address Wales’s lack of control over its own rail infrastructure and the loss of billions of funding with the England and Wales classification for rail enhancement projects.
She added: “This bill makes sense for England. However, it does not work for Wales. It fails to address our lack of control over the Welsh rail track, where two governments manage different parts of what should be a single network. This split makes planning railways in the best interests of the people of Wales almost impossible.
“We can see this in the broken promise to electrify the South Wales Main Line beyond Cardiff, or even to begin work on the equivalent line in the north. Scotland, by contrast, controls its rail network and sets its own strategy, giving Scottish ministers real influence over Great British Railways. Under this Bill, Welsh ministers can only ask to be consulted — Wales does not want consultation, we deserve control. It is time to devolve rail to Wales.”
Professor Mark Barry of Cardiff University, who has submitted evidence on the legislation, said: “The bill is in reality limited to requiring the UK Government and DfT ministers to consult Wales (we have had 30 years of that to little effect). Without substantive statutory underpinning, this is empty and leaves Wales short-changed and without sufficient levers to fund and implement its own transport policy.
“Whereas Scottish ministers can prepare their own version of a long-term rail strategy (LTRS) and produce a statutory High Level Output Specification (HLOS) for Network Rail – as they have done since rail powers were devolved to Scotland in 2005 – Welsh ministers can only ‘have a chat’ with the UK transport secretary to request that Wales’s requirements are considered within an ‘England and Wales’ LTRS and HLOS.”
Welsh Liberal Democrat MP for Brecon, Radnor and Cwm Tawe, David Chadwick, said: “This bill fails Wales. It centralises power in Whitehall, ignores decades of underinvestment, and leaves rural communities like mine at the back of the queue yet again. Scotland gets real control over its railways; Wales gets nothing. Not a single new power. Not a single guarantee of fair investment. Wales deserves equality, not second-class status. That’s why we won’t support this Bill in its current form.”
GBR would also maintain control over services that travel though mayoral regions. The guidance says: “Any proposals for services operating beyond MSA boundaries (should) include clear mechanisms for coordination and mitigation of impacts on adjacent areas and the national network.”
The UK Government was asked, as a matter of principle, why Wales has not been offered full devolution of rail in the same way as English regions are – although this would not involve the same level of revenue transfer to MSAs as would be the case if rail infrastructure was devolved to Wales.
A DfT spokesperson said:” Rail services operated by Transport for Wales are devolved to the Welsh Government, but rail infrastructure and the Network Rail network remain the responsibility of the UK Government.
“We have made £445m of rail infrastructure funding for Wales available through the spending review, and the Welsh Government is closely involved in decisions on how this funding is prioritised and spent.”
The department said the Railways Bill requires a memorandum of understanding between the Secretary of State and Welsh ministers, committing both sides to the setting of shared objectives. It add that these objectives will underpin delivery of the railway network in Wales and the Borders.
The Dft insists that the legislation, which could come into effect next summer, does not remove any existing powers from the Welsh Government but formalises new processes for joint working on rail planning and investment. It added that the strengthened statutory role for Welsh ministers would give Wales greater influence over long-term rail strategy while maintaining the benefits of an integrated Great Britain-wide network.
Giving evidence to the Westminster Transport Committee on the implications of UK Government rail reform for Wales, the Welsh Government’s director of transport and connectivity, Peter McDonald, was asked by Labour MP for Wrexham, Andrew Ranger, how the Railways Bill, as drafted, advances the Cardiff Bay administration’s position on greater devolution of rail policy.
Mr McDonald responded: “I would say that the Railways Bill, as drafted, is neutral with respect to the devolution settlement. It reflects the current settlement. It takes us further in terms of how the current settlement can operate efficiently and effectively, but it does not, in and of itself, move Wales and the Welsh Government further along the devolution spectrum.”
Asked how Welsh ministers would influence or interact with GBR, he said: “GBR will be a very large organisation in a highly regulated and structured industry, so we feel it is important to wire the system effectively within GBR, such that there is adequate respect for, and consideration of, issues affecting parts of the country where services may be fewer but matter greatly to my ministers. That is why the creation of the business unit within GBR is a really important intervention for us.”
