IWA Co-Director Joe Rossiter responds to the Deputy First Minister’s statement on the future of the Crown Estate in Wales.
Following the Deputy First Minister’s Oral Statement to the Senedd on The Future of the Crown Estate in Wales on the 30th September, we are glad to see progress being made on strengthening the case for what devolved government would do with increased powers.
We support the creation of a new Welsh group on the Crown Estate, in order to ‘consider how best to devolve the Crown Estate to Wales’ from a practical standpoint. It is critical that issues of governance and management are central to this conversation. The constitutional arguments for the devolution of the Crown Estate are well established (e.g. the Independent Commission on the Constitutional Future of Wales’ Final Report), and represent alignment with existing devolved responsibilities over planning, energy and economic development.
Equally, underpinning any discussion on the devolution of the Crown Estate is the question: what does Welsh Government want to do with its seabed that is different from the current direction of travel? Beyond capturing the economic benefit? In our view, more can be done to clearly communicate what our aspirations are for the vast potential for renewable energy off our coastline. This working group could also consider this.
It is also important to acknowledge the political reality underpinning the discussion on the Crown Estate and where we are now. Would it slow down the current project pipeline? What would the potential impact be on the Welsh Block Grant if Wales were to receive an uplift in its budget as a consequence of devolution? These are critical discussions going forward.
Pooling resources, including revenues from the Crown Estate, and a percentage of profits from large onshore renewable energy projects, can give new government vehicles, in Trydan Gwrydd Cymru and Ynni Cymru, the tools to truly deliver their transformative potential.
Devolution of the Crown Estate now enjoys widespread (although not unanimous) political support across Wales, including from all 22 Local Authorities. We support the intention laid out by Welsh Government for further discussion to take place on a cross-party basis, recognising this support.
The IWA are proud to have incubated a discussion on the Crown Estate. Our Re-energising Wales report series laid the foundation for a shift in policy focus on renewable energy, outlining how the transition to an energy system powered by renewables represents a significant economic opportunity for Wales.
Further to this, our Sharing Power, Spreading Wealth report, published in 2024, provided a suite of policy recommendations in order to ensure that Wales retains greater income from the renewable energy developments it hosts. This is central to ensuring that Welsh communities benefit from the transition to net zero.
It is in this spirit that our work now calls for the establishment of a National Wealth Fund, pooling revenues generated from the Crown Estate, in order to turbocharge Welsh Government’s ability to invest at pace and scale – to shape our net zero economy and to retain the maximum value from this transition.
We were glad to see the Cabinet Secretary for Finance echo these arguments, in addition to Plaid Cymru’s Economic Plan earlier in the year.
Our Fiscal Firepower report highlights that, despite having a budget in the tens of billions and increasing responsibilities and powers, Welsh Government only has a limited ability to kickstart major projects to improve people’s lives. The establishment of a Wealth Fund, pooling resources to invest at scale, aims to counteract this.
Pooling resources, including revenues from the Crown Estate, and a percentage of profits from large onshore renewable energy projects, can give new government vehicles, in Trydan Gwyrdd Cymru and Ynni Cymru, the tools to truly deliver their transformative potential.
Not only that, but a Fund could further accelerate Welsh Government’s ability to take meaningful equity stakes in community owned renewable energy projects, such as the one undertaken with Morlais.
We welcome the continued focus on the need to devolve the Crown Estate as well as the related focus on the establishment of a Wealth Fund.