A Welsh Green Deal
A Plaid Cymru government will take immediate steps to plan and deliver a £6 billion programme of investment to support Wales’ ongoing economic recovery from the Covid-19 crisis. This will comprise £4bn extra investment in infrastructure and £2bn extra spending on the foundational economy over the course of the five-year term.
We will immediately task the National Infrastructure Commission, working with the Future Generations Commissioner and the Development Bank, local government partners and others, to turn its State of the Nation report due to be published in May into a detailed schedule of investable projects that will lay the foundations of a new resilient Wales.
Investment plans will include measures to:
- Expand and electrify the rail network.
- Retrofit thousands of homes to the highest environmental standards.
- Build thousands of new social homes to address unmet housing need.
- Develop a sustainable Welsh food and farming system.
- Invest in decarbonisation research (for example, for key industrial sectors such as steel, and emerging Welsh strengths in hydrogen and marine energy).
- Grow Welsh ownership of the renewable sector.
- Build the facilities for Wales to become a world leader in offshore wind.
- Repurpose empty shops and offices.
- Achieve Gigabit connection throughout Wales.
- Ensure that new jobs and investment benefits groups and places that face structural barriers to work and have been underrepresented in the workforce, as part of our Nation of Equals agenda.
Financing the Welsh Green Deal
The current devolution settlement cannot cope with the economics of Covid-19 nor the ongoing impact of Brexit. We need an expansion of economic powers for Wales, and especially increased capacity for the Welsh Government to borrow to invest our way to recovery. In the short-term Welsh Government must be allowed greater flexibility to deal with the current crisis. This should include:
- Suspension of the £150m annual borrowing limit.
- Removal of the annual limit on drawdowns from the Welsh reserve.
- Increasing the Welsh Government’s overall borrowing capacity from £1 billion to £5 billion over five years, front-loaded, to immediately address the economic impact of Covid-19 and Brexit. Interest payments would be an estimated £120 million per year which will come from the Welsh Government budget.
However, if Westminster should refuse to grant us the increased borrowing capacity we need we will implement an alternative plan. Our detailed alternative financing plan would include the following elements:
- A national Green Growth Deal in conjunction with local authorities, building on the existing City and Growth Deals.
- Greater Use of Financial Transaction Capital, for example, in funding housing projects as suggested, by Carmarthenshire Council and the housing association Tirion.
- Appropriate use of the Mutual Investment Model, adapting its use to additional areas.
- Investment by the UK Infrastructure Bank and other institutional investors such as the Wales Pension Partnership.
- Exploring a Welsh Green Bond as proposed by the OECD.
Alongside this investment programme we will put the National Infrastructure Commission for Wales on a statutory footing, widening its scope to include social infrastructure, and merging it with the Design Commission for Wales, thereby turning it into a ‘centre of excellence’ for public infrastructure design and delivery.