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Budget 2018: M4 spending not Chancellor’s decision says Drakeford

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The Chancellor Philip Hammond cannot tell AMs to spend extra cash on the M4, finance secretary Mark Drakeford has said.

In Monday’s budget UK ministers suggested their Welsh counterparts could borrow an extra £300m, if it is spent on the planned M4 Relief Road.

Mr Drakeford said it was for AMs to decide how to spend any new money.

Welsh Secretary Alun Cairns said the money was available to build the new motorway.

On Monday the UK government budget announced that it would support the “delivery of a new M4 relief road through a review of the Welsh Government’s capital borrowing powers at the Spending Review, to consider whether the borrowing cap should be increased by up to £300m to support this vital project”.

It came with an announcement of an extra £550m for devolved services over three years – although Mr Drakeford said much of the money was not new.

The Welsh Government can already borrow £1bn, but opponents of the relief road are concerned that committing to the project will tie-up most of that cash for years.

Mr Drakeford told Good Morning Wales that he was told months ago that the borrowing powers would be reviewed.

“It will be for the national assembly for Wales to decide on how borrowing powers are deployed, not for the Chancellor in England, not for the Secretary for State for Wales,” he said.

“If our borrowing ability goes up, which it should go up, it should be for the national assembly to make those decisions.”

The Welsh Government has received the findings of a public inquiry into whether to build the M4 relief road, which estimated to cost more than £1.4bn.

A decision is yet to be taken, with a vote set to take place in the assembly in December.

Ministers in Cardiff have supported the relief road in the past but Mr Drakeford, who is a candidate in the Welsh Labour leadership race, is thought to be a sceptic.

The finance secretary rejected claims ‘austerity’ – the years-long squeeze on public spending – was coming to an end.

“There is no sign of it in these figures,” he said, adding that the increase in cash for the Welsh Government was “derisory”

Well over half – £365m of the £550m announced on Monday – was announced back in July, Mr Drakeford said.

He said the £365m had already been planned into the Welsh Government budget, and claimed UK ministers had taken decisions that meant £169m of it was allocated on pay and pension contributions, while £32m had been taken away by the Chancellor “overnight”.

“In terms of genuinely new money there is we believe about £50m in revenue in current financial year. We have got to spend it before the end of March,” he said, adding there was only an extra £2.6m next year for infrastructure spending.

‘Political decision’

The Welsh Secretary Alun Cairns told BBC Radio Wales that if the M4 Relief Road does not go ahead, “it’s not because of a lack of finance”.

“That would be because of a political decision the Welsh Government take,” he said.

“But if they take that political decision they therefore need to explain it to the business community who have been calling for it for 20 years.”

But Mr Cairns told BBC Wales the budget saw a “significant uplift” for the Welsh Government. The Welsh Secretary said the Welsh Government had had “a 4.1% real term increase” in funding since 2015.

“If anyone had had a 4.1% – they’d see that not as a cutback or austerity but an uplift,” he said.

“Much of this £554m is for this year and next year, and it’s a significant uplift which the Welsh Government didn’t have before”, he added.

The Welsh Government plans to spend around £18bn in 2019-20.

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