Regional Investment in Wales Steering Group meeting, 26 March 2026: minutes

The Chair welcomed members and noted it would be the final meeting of the Steering Group in its current form, reflecting that the Group had met its Terms of Reference in helping shape a new approach to regional investment in Wales.

The Chair thanked members for their contributions over the past year and noted feedback from Steering Group meetings and consultation responses had helped inform the Local Growth Fund Investment Plan which was had now been published.

The Chair said that the focus of the meeting would be the Investment Plan and immediate next steps, an update on regional transition planning for 2026-27, and a discussion on the future role of the Steering Group.

Members were informed the meeting was being recorded for transcription purposes to support drafting of the minutes, which would be circulated for clearance via email.

The draft minutes of the January meeting were cleared for publication on the Welsh Government website.

The Chair invited Tom Smithson (TS), Deputy Director for Economic Strategy and Regulation in the Welsh Government, to provide an update on developments since the previous meeting.

TS noted the Local Growth Fund Investment Plan had been agreed by Welsh Government Cabinet and the UK Government and published earlier in the week. Members had been notified and a link shared. 

TS also confirmed that a Memorandum of Understanding (MoU) between the Welsh Government and the UK Government had been agreed, setting out respective roles, responsibilities, accountability arrangements and annual review mechanisms, and would be published shortly. The MoU includes the option to extend arrangements should a future Spending Review confirm further funding. 

TS noted the Welsh Government would act as Accounting Officer for the Local Growth Fund, with Ministers accountable to the Senedd. Annual reviews with the UK Government would take place prior to the release of funding each year and a Welsh Advisory Board specifically for the Fund in Wales will be established.

TS explained the Investment Plan reflected feedback from the Steering Group and consultation responses, including looking for a clearer focus by narrowing the Fund to three priorities and fewer objectives, whilst retaining flexibility for tailored approaches at the regional and local level.

The three agreed priorities were outlined as: 

• More productive and competitive businesses, focusing on high potential start-ups and social enterprises, targeted business support, capital investment, and increased levels of research, development and innovation.
• Increasing skills and supporting people into work, with objectives narrowed to focus on demand led skills and addressing economic inactivity, recognising the more limited available revenue funding.
• Improving regional infrastructure, with an expectation transition arrangements will mean more strategic infrastructure in later years, particularly those linked to existing or developing regional plans.

TS explained that thematic allocations across priorities had been agreed by the Welsh Cabinet and confirmed with the UK Government. In line with feedback from the group and in the consultation, some revenue is available across all priorities and the majority directed toward skills and economic inactivity. Up to 4 per cent of funding can be used for administration.

On spatial allocations, TS confirmed that transition year allocations would mirror current Shared Prosperity Fund proportions at the request of local government.

From Year 2 onwards, spatial allocations would be informed by a model using the Welsh Index of Multiple Deprivation (60 per cent), productivity variations (30 per cent), and 10 per cent to reflect the lack of agglomeration and additional challenges faced by rural, peripheral and sparsely populated areas.

The emphasis for the funding is therefore on lagging areas or areas that may not naturally attract high levels of investment. This targeting will now need to be reflected further in regional plans. 

TS noted a softer transition to the Local Growth Fund was taking place in Wales compared to the rest of the UK but emphasised the Fund would be different to the SPF with different objectives, a different funding mix, and a stronger focus on a regional approach addressing gaps and working alongside other regional programmes like Investment Zones.

Members raised questions regarding the allocation methodology, including how indicators and rurality were defined, and sought clarification on decision making and delivery arrangements during the transition year.

In response, TS confirmed that a technical note explaining the allocation methodology would be published and shared, and that Shared Prosperity Fund regional lead authorities would continue as delivery bodies during the transition year, providing continuity of contacts and partnership arrangements. This would allow a managed transition over the course of the year to the Corporate Joint Committee (CJC) model for the Local Growth Fund. 

The Chair invited Nadine Young (NY), Head of Regional Investment, to provide an update on regional transition planning.

NY explained the transition year was intended to help manage the shift away from the Shared Prosperity Fund to the Local Growth Fund, avoiding a cliff edge loss of delivery capacity and allowing projects aligned with the Local Growth Fund’s objectives to continue without significant interruption.

NY noted the transition year would also provide time for planning and preparation for a move to a CJC led model from Year 2 onwards, which is informed by lessons learned from previous programmes.

The Welsh Government is working closely with the four regional Shared Prosperity Fund leads to develop transition plans, covering strategic fit with the Investment Plan, proposed investment portfolios and pipelines, delivery and transition milestones, and partnership arrangements.

NY confirmed that £200,000 of revenue funding per CJC would be made available from the LGF in 2026-27 to support capacity building, development of regional growth plans, and preparation for future delivery responsibilities.

NY outlined that Welsh Government would also develop guidance for the Local Growth Fund, including outputs, outcomes and indicators tailored to Wales, and would work collaboratively with delivery partners on monitoring and evaluation.

Plans for pan-Wales and cross regional investment were outlined, including ring fencing 20 per cent of capital funding in Years 2 and 3 and establishing task and finish groups to scope opportunities, develop outline business cases and ensure alignment with regional priorities.

NY noted initial areas for development with pan-Wales or cross-regional projects include research, development and innovation, strategic sites, and capital investment in businesses. There may also be opportunities to coordinate projects around employability provision, tackling economic inactivity and mapping out business support.

Members raised points on the importance of timely guidance, inclusive partnership working, and balancing flexibility with sufficient prescription to ensure effective and representative decision making.

NY confirmed that guidance and indicators were being developed with a view to completion by the end of April.

TS added that the pace of development reflected the need to ensure funding could flow quickly with some elements expected to be refined over time. The Welsh Government would also be setting minimum standards on governance and decision-making for the Local Growth Fund, with a recognition of consultation feedback that partnerships need to be more representative and decisions more transparent.

TS noted a separate Local Growth Fund Advisory Board would be established to focus on governance, delivery and performance of the Local Growth Fund.

TS noted a version of this Steering Group had existed in different forms since the decision to leave the EU, including to look at policy in the round and across different funding streams. TS invited members’ views on the potential value of an equivalent forum on regional investment continuing to inform advice to the next Welsh Government.

Members agreed there was value in retaining a forum bringing together different sectors to consider the regional investment landscape in the round, particularly during the early period of a new government.

Members emphasised the importance of a clear strategic remit for any future iteration of the group, learning from OECD work and past regional investment programmes, and improving coherence across different funding streams and governance arrangements.

No additional items were raised.

The Chair thanked members for their contributions throughout the life of the Steering Group and noted the Welsh Government would provide advice to incoming Ministers on regional investment engagement, including any future role for the group.

Members thanked the Chair for her leadership and work on the Local Growth Fund since the Steering Group was formed.

Chair 

Carolyn Thomas MS

Members

North Wales CJC: Nia Medi Williams, Operations and Resources Manager

South-West Wales CJC: Chris Owen, Chief Operating Officer

Mid Wales CJC: Eifion Evans, Chief Executive

Welsh Local Government Association; Tim Peppin, Corporate Director

Third Sector Partnership Council: Natalie Zhivkova, Policy and Insights Manager, Wales Council for Voluntary Action

Third Sector (Social Enterprise): Glenn Bowen, Director of Enterprise, Cwmpas

Universities Wales (Higher Education): Amanda Wilkinson, Director

Natural Resources Wales (Environmental): Clare Reeve, Lead Specialist Advisor: Strategic Funding    

Medr, the Commission for Tertiary Education and Research: Emma Mock, Head of Skills and Employability

Chambers of Commerce: Gus Williams, Chief Executive, South and Mid Wales 

CBI (Business): Leighton Jenkins, Assistant Director, Policy

Wales Rural Network (Community-led local development): Eirlys Lloyd, Chair, Wales Rural Network

Development Bank of Wales: Anna Morgans, Director of Strategy

Grahame Guilford and Company: Grahame Guilford

Welsh Government attendees

Tom Smithson, Deputy Director, Economic Strategy and Regulation (ESR)

Nadine Young, Head of Regional Investment, ESR

Mike Richards, Communications and Stakeholder Manager, ESR

Eleri Carrington, Head of Regional Policy, ESR

Benedict Watson, Senior Policy Manager, ESR

Cheryl Jones, Regional Policy Manager, ESR

Claire McDonald, Deputy Director, Economic Policy

Ann Watkin, Head of Strategy, Operations Alignment and Planning, Business and Regions