Welsh First Minister Says Spending Powers Advance After Glasgow Talks With Burnham

Welsh First Minister Rhun ap Iorwerth has said there has been a "significant step forward" on his country's spending and borrowing powers after meeting Prime Minister Andy Burnham in Glasgow on Friday. The meeting of the National Economic Council brought together the prime minister with the first ministers of Wales and Scotland, and was also attended by Welsh Finance Minister Elin Jones. Speaking afterwards, ap Iorwerth said it was now a matter of "how and when" a loosening of financial restrictions would take place. "On fiscal flexibility, the ability for us to use our funding better in Wales, use our reserves better in Wales - and on borrowing powers, I was told clearly that it's now a matter of how and when. That is a significant step forward," he said. The Welsh first minister had set out a range of demands in a letter to the prime minister at the start of October, including powers over policing and justice, more funding for rail projects, and an end to restrictions on access to the Wales reserve. That reserve, spare funding the Welsh government can store in one year to use in another, is capped at £350m, with annual drawdown limits of £125m for resource spending and £50m for capital spending. The Welsh government can also borrow up to £1bn for infrastructure, at a maximum of £150m a year. On rail funding, ap Iorwerth said there was "clearly an interest" for the prime minister to understand "the sheer injustice of underfunding of rail in Wales that we have seen for many years", adding that the issue would be taken forward between the two offices. On policing and justice, he said the prime minister "instinctively wants to go there and there's still work to do". Burnham described the meeting as positive and said both first ministers had agreed to work jointly on "regional empowerment" in Scotland and Wales. "We now have a process where we have detailed work by officials on both sides to see if we can come to a set of arrangements that are right for Scotland and right for Wales," he said. He added that the UK government would look at further devolution of employment support and innovation funding to the regional level, with it up to Scotland and Wales to decide how that looks. The summit followed tensions between the Welsh and UK governments over Wednesday's Budget, which the first minister had said was "not serious about Wales". The Budget included an extra £450m for Wales over the next three years, but the Welsh government claimed the money represented a real-terms cut in funding, something the UK government denied. Plaid Cymru also said the budget left the Welsh government with a real-terms cut. A £30m pledge for a new railway station in Cardiff was described as "an insult" by Wales' transport minister, and before the summit ap Iorwerth spoke of "paltry sums of money coming on rail, when they've said there's £14bn on the way". Downing Street said after the meeting that ap Iorwerth had agreed to start a process to explore how each government could contribute to regional empowerment, reindustrialisation and "achieving good growth in every postcode", through a policy sprint led by No 10 North involving officials from each government. In a statement, the first minister said there was "an encouraging consensus that the fiscal and borrowing powers which have for so long put Wales at a disadvantage compared with other UK nations must be revised as a matter of urgency". Welsh Secretary Stephen Kinnock said fiscal flexibilities and borrowing would be on the agenda for future discussions with No 10 North, but said he could not give a specific time frame. Welsh ministers had also sought assurances that child poverty payments they want to introduce would not affect recipients' tax and benefits allowances, which was not addressed in the Budget, though Kinnock said "positive" talks were continuing on the issue. Northern Ireland's First Minister Michelle O'Neill had been due to attend the summit but her participation was blocked by her Democratic Unionist Party, it emerged on Thursday.