UK Government could make M4 Relief Road decision easier with Brexit infrastructure boost says Ken Skates

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The UK Government should pump billions into infrastructure schemes, including road and rail, to support the economy in the event of a damaging exit from the European Union, says Minister for the Economy and Transport Ken Skates.

Speaking at a meeting of Cardiff Breakfast Club, Mr Skates said that the provision of additional finance for infrastructure projects could be a factor in the Welsh Government backing the proposed M4 Relief Road, stretching 14 miles south of Newport.

The project, whose cost is still indicative at £1.3bn (minus VAT), but includes a contingency for a 12% overspend, would aim to relieve growing congestion on the existing and ageing M4 through Newport, in particular at the Brynglas Tunnels.

With the abolition of tolls on the Severn Crossings, traffic levels on the M4 in south Wales are projected to rise by 20%.

From the next financial year the Welsh Government will see its borrowing facility from the UK Government rise from £500m to £1bn.

And in his Budget last year, Chancellor Philip Hammond, announced a further borrowing facility of £300m to the Welsh Government specifically for the M4 Relief.

With £800m in borrowing to help finance the project, and a position where VAT is able to be reclaimed, this in theory could leave around £500m needed to fund it during its construction period.

A report from an independent planning inspector on the public inquiry into the project has been submitted to the Welsh Government. A decision on whether to proceed with a new stretch of motorway will be made by First Minister Mark Drakeford.

Mr Skates said that as the promoter of the project, and being supportive of the so called Black Route option, it was right that he wasn’t involved in the decision making process.

Also not involved is the Welsh Government’s new Deputy Minister, Economy and Transport, Lee Waters, who is opposed to the M4 Relief Road on cost and environmental grounds.

Mr Skates said: “My role is pretty much over in terms of promoting the M4 Black Route scheme. As the promoting minister I had responsibility for designing the proposal and steering it through, not just government process, but through the public inquiry, which was open for a year.

“The inspector has considered in great depth all of the information that was received through that year long inquiry, including every proposed alternative.

“The report is now in our hands and being carefully considered and I am unable to comment any further on the process being followed, as this is not now my duty.”

However, he said that the cost of financing the proposed project, along with the report’s recommendations, would be a key factor. Mr Skates said: “I think it must be set against a backdrop of ongoing austerity. Financing of the project is a key consideration.

“My hope is that in the coming days and weeks the UK Government will do the sensible thing and recognise that in order to get us through any post-Brexit economic downturn what will be required is a huge investment in infrastructure. And my hope is that in realising this, the UK Government will pump more resources into major infrastructure projects across the UK.

“That could include providing additional resource for major road and rail building programmes. I would also like to see the UK Government taking a stronger position in terms of Wylfa Newydd [new nuclear power station project for north Wales] and them taking a stake of £5bn to potentially nationalising the programme if Hitachi pause or halt the scheme.”

When asked what plan B would be if the Black Route option is not taken forward, Mr Skates said: “We had a wealth of alternative solutions provided not only in the public inquiry, but prior to that and indeed since then.

“All of them would have to be carefully scrutinised, but crucially the inspector has carried out an exhaustive and exhaustion job in assessing each and every alternative. I am the promoter of the Black Route and still supportive of the proposal that I put to the planning inspector.

“However, it is now for the First minister to make a decision.”

Cardiff Breakfast Club is sponsored by Blake Morgan, Stills Branding, Lloyds Banking Group, Effective Communication and the Western Mail.