The Welsh Liberal Democrats have called on the UK Government to expand the borrowing powers currently available to the Welsh Government to allow it to adequately respond to the Covid-19 pandemic.
Thanks to the Welsh Liberal Democrats in Government, the Welsh Government has the ability to borrow up to £1billion from the UK Government for capital expenditure projects.
However, this borrowing capacity was designed to enable the Welsh Government to kickstart key infrastructure projects and transport improvements, not respond to crises such as Covid-19.
At present the Welsh Government is forced to wait for Barnet Formula Funding consequentials, from spending decisions made in England, to be clarified before any decisions can be made about spending in Wales.
In response to this, Welsh Liberal Democrat Peer Baroness Jenny Randerson, who has served as a Minister in both the Welsh and UK Governments, has tabled a question in the House of Lords, asking the UK Government “if they will relax the restrictions on the Welsh Government’s ability to borrow during and after the Covid-19 pandemic?”
Baroness Jenny Randerson said:
“We have to accept the realities of where we are and the unprecedented times in which we are living thanks to Covid-19. The UK Government needs to be doing all they can to ensure that all parts of the UK can respond swiftly and effectively to this crisis.
“I am proud to have been part of the Liberal Democrat team in the Wales Office who fought to get the Welsh Government’s borrowing powers expanded. Now is the time to go further to enable them to support those affected by this new pandemic we face.
“I hope the UK Government will look at this issue with the seriousness it needs and ensure the Welsh Government will not be hamstrung by outdated financial restrictions which were not built to respond to this sort of situation.”
Welsh Liberal Democrat Leader Jane Dodds added:
“The Covid-19 pandemic is challenging us in ways we could not have imagined. We are all having to take a cold hard look at the situation before us, identify where things can, and should, be done differently and using this as an opportunity to reset our politics so it genuinely works for all parts of the UK.
“It is clear more needs to be done to give Wales control of the financial levers needed to properly respond to Covid-19 and ensure we can fully support people, families and businesses during this turbulent time.
“Covid-19 has shone a spotlight on this issue, now we need to fix it so we can be in better shape to respond to situations like this both now and in the future. I hope the UK Government will act to expand the Welsh Government’s borrowing capacity swiftly so we can all work together to keep our communities safe.”