Covid: Treasury denies funding plans 'threaten' Wales' recovery

The chief secretary to the treasury has denied UK government plans to replace EU funding will "threaten" Welsh businesses' Covid recovery response.

Stephen Barclay said UK government replacement funding would be "better tailored" to Welsh people's needs.

Wales' economy minister had said Welsh business funding faced "threats" from UK government controlling post-EU cash.

Westminster has promised a "shared prosperity fund" (SPF) to replace EU aid but not said how it world work.

The UK government has launched a new pilot for the SPF, called the UK Community Renewal Fund, worth £220m in 2020-21.

Boris Johnson's government has also separately announced a UK-wide £4.8bn Levelling Up Fund, which Welsh ministers claim is worth only £10m a year to Wales.

Neither scheme, unlike EU funding programmes, is administered by the Welsh government and councils will have to bid for the cash.

When asked whether plans to allocate smaller pots of cash to local authorities for projects would be available for Wales-wide schemes which had received EU funding, Mr Barclay replied: "No."

"There's much closer working now between the UK government and local authorities across Wales, Scotland and Northern Ireland, much more so than in the past," he said.

He added it was for Welsh ministers to decide how they spend the £8.6bn extra the Treasury has sent the Welsh government in this year as a result of extra spending in England.

But he did not confirm how much extra would be provided in 2022, saying this would be "commensurate with the pressures that come from the pandemic".

Jobs Growth Wales is a programme run by the Welsh government to support 16 to 24-year-olds get into work while Prime Cymru provides employment support for adults over 50 - both schemes previously got EU cash.

Mr Barclay was asked on BBC Politics Wales whether he had evidence that giving money to local authorities for regeneration projects would be better at creating jobs in the long-run compared to Wales-wide schemes - and he replied: "We have the UK SPF scheme itself which will be piloted this year.

"But the point is we are able to design this in a bespoke way to meet the specific needs of Welsh businesses and the Welsh economy and the UK as a whole.

"We have much more control over the schemes that we design so they are better tailored to the needs of the Welsh people - that is the opportunity that Brexit unlocks but the support will be there and we made that commitment.

"One of the issues raised with me by a number of the Welsh MPs is how often, for example, in north Wales it's important that schemes look across the border because, obviously, there's a big interaction between north Wales and schemes the other side of the border and that's one of the opportunities we have.

"It's about designing schemes in the way that work best for the areas we're supporting, taking a more bespoke approach, that's why we're piloting through the UK SPF a number of different options.

"That's why we're working closely with the business community, including the Welsh secretary meeting with the CBI [Confederation of British Industry] so we get these schemes right and level up across the United Kingdom."

This week, the director of the employers group CBI Wales said the Welsh and UK governments needed to "pull together" and that political differences should not get in the way of Wales' pandemic recovery.

"That's why we're engaging widely at all levels with local authorities much more so than in the past so they have more conversations with the UK government and indeed with my counterparts in Wales," said Mr Barclay.

Welsh Economy Minister Vaughan Gething had said the UK government's replacement plans for EU funds meant a "funding cut and centralised decisions in Whitehall".