Wales deserves Crown Estate profit wealth fund - Drakeford

Wales' Finance Secretary Mark Drakeford says Wales should benefit from wind projects off the Welsh coast, not the Crown Estate

Wales' finance secretary has called for the creation of a sovereign wealth fund out of profits from the Crown Estate.

Mark Drakeford said it would ensure Welsh people profit from offshore wind projects in the Celtic sea.

While the former first minister admitted it was not official Labour policy, he said the UK government, which rejected devolving the Crown Estate in February, should "come to the table".

A sovereign wealth fund is a state-owned pot used by governments to manage money often generated though state-owned natural resources or financial projects.

Mr Drakeford said, historically, Wales' natural assets had been exploited, including through the coal industry.

Wales continues to deal with that legacy, he said, "the profits have all been siphoned off elsewhere".

He said while the renewable energy industry was key to the future, measures should be taken to ensure Welsh people see the advantages too.

"These things belong to us and this time, unlike the coal industry of the past, we must make sure that it is Welsh people who see the benefit," he said.

Referencing wind projects currently being developed, including in the Celtic sea, he said a fund should be created by taking a small amount of money from each unit of energy generated by Crown Estate projects.

These would then be reinvested into Wales.

Many countries around the world operate sovereign wealth funds, with China, Saudi Arabia and Norway operating some of the largest.

Norway's managed funds from oil and gas are invested worldwide, acting as a financial reserve and long-term savings plan, with the profits designed to benefit Norwegian citizens.

Saudi Arabia's sovereign wealth fund purchased Newcastle United FC in 2021.

Floating wind farms are to be built in the Irish Sea off Pembrokeshire under agreements with Crown Estate

Wales' First Minister Eluned Morgan renewed calls for the Crown Estate to be devolved in her speech at Labour Conference, a policy UK Labour does not currently support.

Drakeford said while he also supports devolution, it would not necessarily need to happen to create a sovereign wealth fund.

"There is some middle ground here, what we need is for the UK government to come to the table to have those conversations," he said.

Plaid Cymru announced their plans last year to create a sovereign wealth fund from Crown Estate profits, but Mr Drakeford denied he was taking their idea.

"Ideas don't belong to any particular party, do they? If this is a good idea and if this is the right idea for Wales, I'm very keen to have that debate and then to see the right way to make it happen," he said.

The former first minister was speaking at the Labour party conference, during a fringe event discussing how taking assets into public ownership could win back votes from Reform UK.

Reform UK support 50% public ownership of critical national infrastructure, including rail, with a similar policy for energy and water companies.

Chancellor Rachel Reeves is set to announce new rules to prioritise British-built ships and British-forged steel, as part of her vision for a renewed economy in her annual conference speech on Monday.

Plaid Cymru's Westminster Leader, Liz Saville Roberts said: "It has always been within the gift of this 'partnership in power' to devolve the Crown Estate to Wales so that our communities can benefit from the wealth created here. Anything less is simply political theatre."