The BBC Wales headlines summed it up…’£1bn funding row puts new rail franchise in jeopardy’. It is a row that has been brewing for quite a while and now has erupted into cross border warfare. The Wales & Borders Franchise was due to be fully devolved to the Welsh Government and four train operating companies are interested as preferred bidders. The Invitation to Tender was due to be announced by the Welsh Government but now the Department for Transport has delayed it, despite the fact it was meant to be a devolved responsibility. As a result, the Welsh Government are claiming £3.5m in compensation for delays it says were caused by Westminster.

In an acerbic response, Mr Grayling accused the Welsh Government of ‘cumulative delays’ quoting as one example the cross border issue not being resolved. He also laid on the big stick by saying that ‘The tender process will not begin until all issues are resolved. The scale of the challenge for us all is clear. Thus it became clear to the Welsh that Mr Grayling was threatening them with putting the whole franchise process on hold, despite devolution.

The main funding issue is the £1bn requested by the Welsh Government relating to the annual rebate of £67m given by current franchise holed Arriva Trains Wales to the Department for Transport. The rebate which is related to track charges is passed to Network Rail via a grant for improving railways.  Yet, Welsh railways appear to receive little of this and much of the system outside of the South Wales main line remains in the Victorian era or worse. The UK Secretary of State for Transport, Mr Chris Grayling, dismissed the Welsh claim as ‘a claim that would commit my department to finding an addition £1b over the franchise term compared with today and for which I see no basis’.

The Welsh Government immediately took up the challenge with statements that…’Mr Grayling’s letter misrepresents a complex devolution position. His approach jeopardises the Welsh Government’s ability to award a replacement for the current Wales & Borders franchise which, if unresolved, will be a major issue for all rail users. Being willing to subject people to the prospect of continued overcrowding and poor quality rolling stock to resolve a budgetary issue of their own making is no way for the UK government to behave’.

Hot foot on the heels of Mr Grayling’s other announcement that electrification of the South Wales main line through to Swansea had been abandoned, it is not surprising that the Welsh are smarting and prepared to take up ‘political arms’. The Welsh Government strongly accused the UK government of a ‘cavalier attitude to devolution’. Elsewhere in Westminster circles, it is becoming evident that anti-devolution is taking hold as Mr Gove has cancelled all dialogue with the Welsh and Scottish administrations over environmental issues!