For the first time in its 82-year history, Plaid Cymru, the nationalist Party of Wales, will form part of the government in the Welsh Assembly. After nine weeks of political horse-trading since the May 3 elections, the party has formed a “One Wales” coalition government with Labour, while junking the Rainbow Coalition it was negotiating with the Conservatives and Liberal Democrats.

In the elections, Labour had its worst results since 1918. Its vote fell by 8 percent, leaving it 3 seats short of the 30 needed to form a majority. Plaid Cymru, which made every effort to dress up its right-wing programme of corporate tax-cutting with left-sounding rhetoric, gained 3 more seats at 15, with the Conservatives securing 12 and the Liberal Democrats 6.

Labour’s first minister, Rhodri Morgan, and Plaid’s leader, Ieuan Wyn Jones, who becomes deputy first minister, hailed the One Wales agreement as a “progressive, stable and ambitious programme for government”.

First Minister of Scotland Alex Salmond, whose Scottish Nationalist Party is in government for the first time after narrowly defeating Labour on May 3, congratulated Wyn Jones. Salmond raised no criticism of Plaid’s coalition with the party now leading the opposition benches in the Scottish Parliament. He instead called for new “formal mechanisms for dialogue” now that nationalists were in power in Scotland, Wales and Northern Ireland, where Sinn Fein shares power with the Democratic Unionist Party.

In all essentials, the One Wales programme is identical to the All Wales agreement Plaid made with the Rainbow Coalition, confirming that there is nothing of any substance separating the official parties in the Welsh assembly. All are wedded to the same pro-big-business agenda. Neither programme even mentions the invasion and continued occupations in Afghanistan and Iraq, although this was the main issue accounting for Labour’s loss of support and Plaid’s successes.

The orientation of all the official parties is towards how best to continue along the path laid out by the Labour Party since coming to power in Westminster in 1997, while stifling the growing opposition to war and the attacks against the living standards amongst broad layers of people.

Plaid’s main concern, like that of the SNP, is to secure a quid pro quo from Labour in return for its collaboration in the form of concessions for Wales—or more correctly for the regional business interests and privileged middle class layers it represents.

Both programmes included two long-standing demands of the nationalists that will only encourage further separatist sentiments and stoke up antagonisms with the rest of the UK—a referendum on full lawmaking powers for the Assembly and a review of the Assembly’s funding. The nationalists claim that Wales is seriously underfunded as a result of the Barnett formula, which the UK Treasury uses to allocate money to the regions based on population.

The Conservatives have argued that Wales receives 12 percent more funding per head and Scotland over 25 percent more than England. Spending per capita for Scotland is £8,265, £7,666 for Wales and £6,762 in England. Plaid is demanding more, citing greater problems of social deprivation in the country.

This has created a backlash in England, where the Conservative Party, Labour’s Mayor of London Ken Livingstone and sections of the media are whipping up Little Englander nationalism based on demands for an end to the “subsidies” enjoyed by Wales and Scotland.

The One Wales coalition has also had to make promises with regard to health and social housing provision in the face of widespread opposition to the last administration’s cuts. More money would be needed to put this in place.

However, pledges to end the National Health Service (NHS) internal market and to continue the ban on Private Finance Initiative schemes are cloaked in deliberately ambiguous formulations like the promise to take “a more open approach to NHS reconfiguration involving more public consultation.” In a similar way, the transfer of social housing, most of which needs repair and maintenance, out of council control will continue. But the coalition will “work actively to ensure that tenants have access to impartial advice” during transfer ballots. Instead of a commitment to build substantial numbers of good quality, socially owned homes, the coalition promises only to undertake the construction of 6,500 “affordable” houses over four years.

Whether the coalition can even deliver on these feeble promises is doubtful, given signs that the Treasury will only increase the Assembly’s £14 billion budget by 5 percent in the next session, down from 10 percent in its first term and 6.5 percent in its second.

The One Wales agreement was approved by more than 90 percent of Plaid’s national council. One member of the council, Plaid MP and coalition negotiator Adam Price, explained how the coalition was the culmination of Plaid’s campaign to put pressure on the Labour Party in the hope that it would lead to “the emergence of Plaid, as in Scotland, as the largest party of the left and inheritor of the left’s hegemony, or the creation of a genuinely autonomous Labour Party which has finally broken its umbilical ties with the British State. Either outcome would accelerate our progress on the path to political independence.”

It is not Welsh Labour that has moved left, but Plaid that has exposed its pretenses to be a left alternative to Labour.

The enthusiasm for the deal was not so evident in the Labour Party. Although 92 percent of trade unions and groups affiliated to the Welsh Labour Party voted for the programme, this fell to 61 percent amongst constituency parties. The majority of Westminster MPs representing Welsh constituencies and the former Labour Party leader Neil Kinnock are vehemently opposed to the coalition, fearing it will lead to the further fracturing of the United Kingdom and seeing the concessions as an attack on the New Labour agenda.

Islwyn MP Don Touhig said, “I am totally opposed to sharing power with Plaid in the Assembly. This is wholly wrong and it is suicide for Labour. The party is walking into a trap.”

Pontypridd MP Kim Howells, minister with responsibility for the Middle East and South Asia, went further—blaming the Labour government for bringing in devolution based on proportional representation in 1997 and the creation of an Assembly “that would inevitably attempt to gather to itself ever greater powers and responsibilities.” He attacked the Labour Party in the Assembly for becoming “the vehicle for transforming significant elements of Plaid Cymru’s political aspirations into reality,” which will “lead ultimately to separation and independence.”

Morgan replied to his critics asking them what they thought the alternative was. “I keep saying to them, ‘Well what else do you want me to do then? Just be voted out of office before the end of July?’ ” He explained that it was impossible to maintain a minority Labour administration, and he could not get the Liberal Democrats, coalition partners in 2000-2003, to form a coalition: “If we hadn’t peeled Plaid away from the triple alliance, they would have become legitimised in government as the leaders of government.”