Welsh budget facing cuts because of Starmer defence plans, says first minister

Wales' first minister says the money he has to spend on new buildings and other infrastructure will be cut because of UK government defence plans.

Rhun ap Iorwerth said he was "deeply concerned" that schools, hospitals and other schemes "could miss out on vital funding". He said sums could be cut this year and future years.

A Welsh Labour source close to the UK government said the "contribution" the Welsh government will make over the next four years will be "minuscule", and suggested Plaid Cymru was playing "fast and loose with national security".

BBC Wales asked the UK Treasury for figures. The Welsh government said it was "many millions" but that it was for the Treasury to say how much.

Prime Minister Sir Keir Starmer has said a £15bn increase in military spending will be funded by cutting investment budgets in other areas.

The Welsh government's budget is mostly funded by the UK government, based on a calculation of what is spent on public services in England.

If budgets are cut in England, that can mean less money for Welsh ministers.

In a letter from the first minister to Welsh Secretary Jo Stevens, ap Iorwerth said: "I know that we share a commitment to the safety and security of our citizens in Wales and the wider UK, and it is important that defence forces are adequately equipped to face modern-day threats.

"I was, however, deeply concerned to learn that Welsh government capital budgets are facing cuts this year and in following years to fund the Defence Investment Plan (DIP), meaning that schools, hospitals, and infrastructure projects in Wales could miss out on vital funding as a consequence."

He alleged there was "no advanced warning of the precise scale of these cuts" - and said he first heard about them in the media.

The Welsh government added: "It is completely unacceptable that Welsh capital budgets which are already stretched are now being cut by potentially many millions of pounds in this financial year – and years to come – to fund a plan we were given no say in."

Pressed for more information, a spokesperson said: "The figures are not yet settled, but the UK government has confirmed that there will be significant cuts to the Welsh government capital budget starting this year."

Earlier the UK government said the DIP included £50m for Wales, which had been announced earlier this year and will be aimed at helping small and medium sized companies to grow.

A Welsh Labour source said Plaid's response "to safeguarding the country's defences is disappointing but not surprising".

"Protecting the public should be the first priority of any government, and they should never play fast and loose with the national security."

The source added: "The Welsh government's contribution over the next four years is minuscule compared to the record budget secured by the Labour UK government over that same time frame.

"The UK government has already boosted the Welsh government's spending power by nearly an additional £6.5bn in this period, with an average £22.4bn annual budget."

"Everyone must play their part to keep our country safe, including Plaid Cymru."

Sources in both Labour and Plaid Cymru said that Finance Minister Elin Jones attended a meeting where the defence spending plans were discussed.

The Labour account of that meeting said it involved ministers from the Treasury and the Ministry of Defence, and said Jones had been supportive and that it had been agreed that numbers would be sent to the Welsh government. The meeting had ended on good terms, the source said.

A Plaid government source said the finance minister was present at the meeting on Tuesday and was "surprised that no figures were shared with her in the meeting".

In a statement on Tuesday, Chancellor Rachel Reeves said £10.3bn would be switched from UK government departments to fund extra defence spending. Another £4.7bn will have to be found at the next budget, she said.

Welsh Labour has been putting Plaid under pressure in recent weeks over defence, and whether the party supports the defence alliance Nato.

Challenged about Nato membership in the Senedd last week, the first minister said neither he nor Plaid Cymru "has ever advocated or suggested that the UK should pull out of Nato".

"It would of course be for an independent Wales, in years to come, to decide on what kind of association or membership it would have with Nato," he added.

Additional reporting: Daniel Davies