Tough 2024 ahead for Welsh Government and Transport for Wales

Economically and financially 2024 will be another challenging year for Welsh Government and its transport body Transport for Wales. This is particularly so as there appears to be a dichotomy in the Welsh Government’s transport objective to reduce car use and increased travel by bus and train.

In 2023, as bus company costs increased - from fuel, wages, investment and the 20mph speed limit -the Bus Transition Fund was withdrawn by the Welsh Government. It, and its predecessors, had helped bus operators to recover financially from continued low passenger numbers post Covid.

Then, in the draft budget last month the Climate Change department’s expenditure for 2024-25 was cut by 4.79%. Most of this is for transport so putting in jeopardy the government’s 2022 White Paper one network, One timetable, one ticket plan to integrate all bus and rail services in Wales already facing financial issues. This would make bus and rail travel easier and more convenient and is intended to attract car users to public transport and active travel. The issue to be faced in 2024 is how to achieve those objectives.

The new electric powered buses in Cardiff, Newport and on the TrawsCymru T1 service in west Wales will contribute.

On the 20mph speed limit research is clear – there is less chance of being killed or seriously injured through contact with a motor vehicle travelling at 20mph than one travelling at 30mph. However, it continues to be controversial for two reasons.

Firstly, it was not evaluated using Welsh Government’s own criteria which examines a wide range of strategic, economic and financially related factors and not only road safety elements in determining a large £37m expenditure. Thus its priority position has been questioned.

Secondly, the implementation process turned public opinion against the scheme from 52% against (August government survey) to 70% (November ITV survey). The public were not brought along. Ineffective government publicity had the conservative London media referring to the ‘default’ definition as a ‘blanket imposition’ and to frequent changes in the speed limit. Ministers now have to put this right in 2024 if any benefits are to be achieved.

The railway investment programme continues apace with new diesel trains being introduced over Wales’ rail network. Electrification of Valley Lines north of Cardiff is well advance although costs have increased from £800m to £1.1bn.

This funding is at Welsh Government’s risk as we receive no Barnett consequential funding at present and will affect future government finances through repaying the capital loans with interest. Now is the time to persuade a likely UK Labour government to achieve a Barnett-type formula (which has served Scotland well) to consider electrification of the north and south Wales main linesand a new fast service to/from west Wales via the Swansea District Line’s Felindre station.

However, alongside this investment programme lies the poor performance of Wales’ trains reported by the Office of Road as caused by Network Rail engineering delays and Transport for Wales staff and train shortages. The government has to act if passengers are not to be lost to the car – the exact opposite of the Cardiff Bay administration’s objective.

Climate change will have a major impact on our lifestyle and has influenced transport policy for the last several years. However, transport is one of the top four criteria (alongside government grants, utilities/land availability and available labour) used by companies considering Wales as a candidate for inward investment. Should that not be transport policy’s main objective? Ironically, transport is a base method of changing modal split and responding to climate change.

Surely COP 28 showed that China and India will not conform and Middle Eastern oil producers have a financial interest in increasing production. Wales’ role in comparison is very small.

Following the Welsh Government’s pay deal with unions Wales did not suffer as much as England from the rail strikes last year. This will come up again in the 2024 pay negotiations despite financial cuts in the transport budget.

Overriding all these decisions is the election of the new First Minister. The outgoing FM, Mark Drakeford, put transport into the climate change ministry rather than the economy department . Whether this will continue will be a decision for the successful candidate. Vaughan Gething, the current Economy Minister and Jeremy Miles with his practical business background will both be fully aware of the criteria considered by inward investors.

Some fundamental changes are needed in the role of transport policy and investment if we are to have a Blwyddyn Newydd Dda/Happy New Year

  • Professor Stuart Cole, CBE, is Emeritus Professor of Transport (Economics and Policy), University of South Wales.