Communities in every corner of Wales will benefit from a new fund, worth more than half a billion pounds, to create jobs and grow productivity across Wales.

The Local Growth Fund replaces money that used to come from the European Union.

Decisions about how the money will be spent will return to Wales, honouring the UK Government’s manifesto commitment to restore decision-making on money that previously came from the EU.

The Welsh and UK Governments have agreed a framework which will set priorities and processes for allocating the funds, with a delivery plan developed and led by the Welsh Government.

Local authorities and other partners will have a key role in deciding how the funding is spent. Later this month, the Welsh Government will consult on the best way to use this funding through a consultation.

The Welsh Government is keen to understand how it can best:

  • support people into work and help people gain new skills and qualifications to progress into higher paid jobs, so that a larger proportion of the population is employed
  • help create and grow Welsh businesses in key sectors and boost investment in research and innovation, in areas such as health and bio-tech, financial technology, low carbon energy and AI
  • address the issues that are holding back growth, such as the need for key sites and premises, renewable and low-carbon energy generation, energy efficiency, and low-carbon transport.

First Minister Eluned Morgan said:

“Our new Local Growth Fund for Wales is a significant opportunity to support businesses and social enterprises to grow, export and innovate - particularly in high-growth sectors such as AI, cybersecurity and digital transformation. By tackling barriers like access to finance and encouraging investment in research and development, we can help build a more competitive and resilient Welsh economy.

“Supporting people into work and helping them progress is vital to reducing economic inactivity. By aligning skills development with the needs of our regional economies, we can ensure people across Wales are well placed for the jobs of the future.

“We’re keen to see a strong focus on green infrastructure, energy efficiency and local regeneration. We will encourage investment in renewable energy, low-carbon transport, and heritage. Tourism will be supported in a way that helps our communities thrive.

“I’m very pleased that, following agreement with the UK Government, decisions on the priorities in this fund will be made here by the Welsh Government.”

 Secretary of State for Wales Jo Stevens said:

“This more than half a billion pound investment from the UK Government is key to driving economic growth in Wales, helping to grow businesses and get more people into good well-paid jobs.

“Decisions about how this money is spent are best made by people in Wales and we are working with the Welsh Government to achieve our shared priority of delivering growth, prosperity and opportunity across the country.”

Cabinet Secretary for Economy, Energy and Planning, Rebecca Evans, said:

“This new fund will focus on supporting regional growth and productivity, as well as tackling economic inequalities.

“We will now work at pace with our partners to prioritise investment in each region.”

More information on the funding will be announced in the coming months.