Climate Change, Environment, and Infrastructure Committee, 29 January 2026 | Open Senedd

Open SeneddCymraeg

Climate Change, Environment, and Infrastructure Committee, 29 January 2026 | Open Senedd

Yr Athro Mark Barry

Peter McDonald was giving evidence at Westminster, and I watched that exchange, and he gave a very good civil service response to a question from the committee. He has to be guarded in what he says. I'm not going to share any confidences, or reflect what other people have told me, but, within the context of the current devolution settlement, the Bill does what it does. I think the thing that Peter pointed out, quite rightly, is that a huge amount depends upon the memorandum of understanding and what's in it, and how that's enforced or enacted. The observation I'll give is that there's no clarity on what will be in that, and there is no statutory method to enforce anything that's in there. So, whatever may be agreed informally and captured in the memorandum of understanding is fine, it might look good politically, but, in terms of actually how people behave now, in a month, in a year, in five years, it's actually pretty weak and meaningless.

There were opportunities, I think, to go further under the current arrangements, giving Wales the right to produce its own high-level output specification, greater division between GBR in Wales, GBR Cymru, from the rest of the GBR, looking at the working relationships, which are very positive and very effective, between Transport for Wales now and Network Rail in Wales—better perhaps than they've ever been. But what we have is like, 'Well, we can sort that out, we can do that, we'll put that in the MOU.' And, for me, that is not good enough. I worry that what progress we are making, despite challenges in Wales, on integration, on working together, especially on bringing together issues of data and asset management with train operations and planning thereof, we'll get dragged back into a much more complex, cumbersome, bureaucratic process of a GBR rail transformation, when we're already ahead of the game in some respects.

So, Peter McDonald gave a very good answer that reflected his current role, his current Minister, and his civil service responsibilities. I'd be a lot more robust, I think, if I was answering the question.

09:33Watch #Official Record

Yr Athro Mark Barry

Well, it's not just—. Clearly, if there's a very different Government in Westminster, it could choose to do what it wants to do without contravening the legal provisions of the Bill, because the MOU doesn't have any status. What's more—a reflection, I think, that I've learned over the last 15 years—it's not just Ministers that influence power and control; it's the civil service and the bureaucracy around it. It's about how the civil service works and what advice they give Ministers, and what they allow Ministers to decide to do, and what options they give them.

Now, the truth is that Wales is a small, almost inconsequential bit of the whole rail industry ecosystem, and, for most civil servants [correction: most Whitehall civil servants]—and I'm not being disrespectful to them; they work very hard, professionally—we're not of interest, we're a distraction. The only reason we do make progress on some matters is because a few civil servants, some of whom I've made contact with and talked to and helped and shared information with privately, have managed to see the issues and pushed an agenda, in a massive ecosystem, that makes things happen.

If you've got different civil servants—. And for many years we've had, probably, more indifferent civil servants; we had even less out of Westminster and out of Whitehall specifically. The risk we face with an MOU that has no statutory basis is that we have civil servants moving on, new ones come in, they've come from a completely different department or lack awareness of the geography of Wales, and have political masters who, again, have little interest in the devolution agenda, and we're left looking at why are we not getting fair funding, why can't we control our railways, why can't we integrate our rail planning with our bus franchising process, why can't we think about planning [correction: land use planning] in respect of our rail infrastructure. It's crazy. The situation we have is a really dysfunctional setup. And the opportunity here was to do something.

One other observation I'd make: one of the big drivers for the rail Bill—and I completely agree with it, and, for England, I think it's moving substantially in a good direction—is vertical integration. The idea of separating train and track—. I understand why the rail change was made in the 1990s, to try and create some more commercial pressures, and there's been a lot of benefits from that. Passenger numbers have gone up a lot, driven by innovation in train operating companies. But they're removing those barriers because they added bureaucracy, they added costs, they added who's dealing with liabilities, who's responsible. In England, they are going to vertically integrate [correction: simplify and vertically integrate] the railways. But, in Wales, we're not. It's as simple as that. We're left with a situation where transport—

09:36Watch #Official Record

Yr Athro Mark Barry

I do believe that, emotionally, there is a recognition of a problem, and I do believe that even politicians with Welsh interests at heart have been trying to move this agenda forward. But when you're dealing with a UK Government that's struggling financially and that's under pressure, with a Whitehall bureaucracy that overwhelmingly is disinterested in Welsh issues, to suggest changes, fundamental changes, in how we fund Wales, to properly devolve it, to make an appropriate block grant adjustment before you then apply Barnett allocation subsequently, it's really a tough ask. So, even though I'm very clear, a £300 million commitment in the comprehensive spending review—which is what it is, not £450 million; it's £300 million—compared to £34 billion in England tells its own story. I do think the Secretary of State has tried; I do think the Minister has tried. But we're in a situation where we have no leverage. How do we influence the bureaucracy of Whitehall and the politics around that to actually precipitate a solution?

I'll make one further point on this. I think there's an issue that we fail to recognise, that Westminster's not just constitutionally compromised in some way, but I think, economically, in the UK, over the last 30 years, capital investment per capita, including on things like transport, has been twice as high in London as anywhere else. Wales has actually done poorly. But if you look at the north-west of England, the north-east of England, the south-west of England, other parts of the UK: equally poor. Economic performance reflects that to a certain extent. We have a Westminster/Whitehall problem, not just in Wales, but in other parts of England. I do think the conversation about the economy and about how we improve the economy has to embrace and grab hold of the issue—of all those major decisions on capital funding being wrapped around a handful of people within a mile and a half of Westminster and Whitehall. That is not healthy for democracy or the long-term well-being of the economy, not just of Wales, but other parts of the UK. I think we have to look at this question in that context, and say, 'Why are we still behaving like it's 1850 at Westminster?', which is how we are, frankly.

09:46Watch #Official Record

Yr Athro Mark Barry

What is a fair settlement is a negotiation. Now, it's not necessarily a Barnett—. Barnett applies to already devolved functions, to then make sure that adjustments to English functions that have been devolved then flow through the Welsh Government. It's not used to determine what that initial block grant adjustment looks like. So, if you devolve something, and a reserved matter becomes non-reserved, a devolved matter, what should be the funding flow that otherwise would have gone to an English department to Welsh Government? Now, from a Welsh perspective, 5 per cent probably isn't right, because you're dealing with a more depreciated asset, perhaps, more exposure to climate change issues, and also the fact that the route length is about 10 per cent of the UK network, 8 per cent of the track. So, you probably wouldn't want a 5 per cent settlement.

Now, I can perfectly understand officials thinking about all the risks and liabilities, and there are liabilities. The flooding issues are increasing because of climate change. You look at the rain gauge data Transport for Wales have got on the Valleys lines and the volatility—it means that they have to spend more on managing and maintaining the asset. So, the settlement and the conversation is a negotiation. And good people in a room with a fair mind, being objective, can probably come up with something.

The cost per passenger, off top of my head, I don't know. But if I was to start as a basis, I'd say, 'Well, what do we spend on rail in England?' And I think, roughly, the figure is about—. Did I say £23 billion annually? About £6 billion to £7 billion is the run rate of high speed 2 to at the moment—£6 billion to £7 billion a year, probably for another 10 years—and Network Rail spend per year is about, I think, £13 billion, £14 billion, so £23 billion. You might say at the start, well, 5 per cent of that should be shifted over to Welsh Government. That would, of course, come with the current funding that goes to Network Rail for OMR—operations, maintenance and renewal. Their settlement is about £400 million a year, so you have to take that on board. But you've then got £600 million a year more, even if you include some enhancements. You'd have more than currently seems to be available. That may not be enough, because I think the state of the asset needs to be looked at.

09:49Watch #Official Record