Olympics – the funding disgrace continues…

We (Wales, Scotland and Northern Ireland) asked for £300m in Barnett consequentials of East End of London regeneration spend in the run up to the Olympics.

The formal complaint was heard this week – the result – the case is just but we can’t afford to go back so here’s £30m to shut up. Astonishingly BBC Wales describe our share as a £9m windfall!

Alan Trench knows a bit better. Writing for the Institute of Welsh Affairs, Alan says:

….. the Labour UK Government redefined the nature of spending on the London Olympics during the 2007 Spending Review, so as to exclude the spending on regeneration of the wider Olympic area as for the benefit of the UK as a whole rather than for England.  If it were ‘English’ spending, as all other regeneration funding is, it would have triggered such consequentials.

Andy Burnham made this decision when he was Chief Secretary to the Treasury, to avoid a potential over-run on the costs of the Olympics. The result was to deprive the devolved governments of several hundred million pounds of funding, which became a long-standing source of grievance for them.
The new protocol on dispute avoidance and resolution agreed in April 2010 was framed in response, and the issue of the Olympics consequentials was the first one referred to the new disputes resolution panel of the Joint Ministerial Committee, which met to consider it in October 2010, under Francis Maude’s chairmanship. All three devolved administrations took part in that complaint, and in order to agree a common position adopted £330 million as the value of the missing consequentials. I’m told that this involved a substantially lower figure for Wales than the Welsh Government thought it should receive.



This means the devolved governments have compromised a claim of at least £330 million for about £30 million, less than a tenth of the sum, which they thought they should get. In fact, the amount lost by the devolved governments is more than that – if the amount allocated in the SR 2007 period had been allocated at the proper time, it would have been added to the baseline of the block grant and so resulted in further increases in subsequent years. Effectively, they have forgiven UK Government for their claims for the way the Labour government handled the matter, and limited the claim to changes made to Olympics funding since the UK Coalition took office.

I’m astonished at the lack of political response to this scandal. Any reaction from over with you?

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