Jessica Morden

Labour MP for Newport East

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Labour Reaction to Autumn Statement

Owen Smith MP, Labour’s Shadow Welsh Secretary, commenting on the Autumn Statement, said: 

“Today’s Autumn Statement revealed George Osborne’s total lack of understanding about the cost of living crisis facing Welsh households.  The average Welsh worker is £1700 a year worse off under the Tories which means that, despite the welcome return of growth in the economy, ordinary people are worse off.

The Chancellor tried to put a rosy spin on the numbers, but the fact remains that living standards are falling, and with expected wage growth being revised downwards today, people in Wales can’t look forward to an improvement any time soon. “As we would expect from a Chancellor that prioritised a tax cut for millionaires, today’s statement offered no answers to real challenges facing Britain. He refuses to take on the energy companies and tackle the spiralling cost of gas and electricity. His marriage tax plan won’t help five out of six families with children, and housebuilding remains at its lowest peacetime level since the 1920s. A Labour Government would take a different course and ensure the recovery benefited the many, not just a few at the top, by freezing energy prices, strengthening the minimum wage and scrapping the bedroom tax. 

“George Osborne also revealed that his previous pledge to balance the books by 2015 won’t now be met until 2019, and he will be borrowing £198 billion more than he told us he would three years ago. This economic mismanagement has seen the Tories borrow more in 3 years than Labour did in 13 and unfortunately it is millions of ordinary families that will be paying the price.  

“The cuts to departmental budgets will also affect Wales, with the Welsh Government budget £1.6bn lower than it was at the time of the general election. I know that Welsh Ministers will continue to take tough decisions and try to protect Welsh communities from the Tories’ ideological assault on public services.” 

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“Autumn Statement has done little to change the challenging public finance outlook for Wales” – Jane Hutt Wales’ Finance Minister Jane Hutt has responded to the UK Government’s Autumn Statement – saying that it has done little to change the challenging public finance outlook for Wales and the Welsh Government’s Budget has still been cut by 10% in real terms since 2010. 

The implications of the Autumn Statement on the Welsh Government’s budget are as follows:  ·         In 2014-15 the total revenue increase will be £66.7m.  The total capital increase is £9.775m of which £5.750m is ring fenced  for Financial Transactions.·         In 2015-16 the total revenue increase will be £74m.  The total capital increase is just over £41m of which £38.6m is for Financial Transactions.  Finance Minister Jane Hutt said:  “Although we welcome the more positive growth forecast for the economy, today’s Autumn Statement has done little to change the challenging public finance outlook for Wales. 

After three and a half years of budget cuts, and the weakest and slowest recovery in history from recession, we still face tough decisions in delivering our priorities of growth and jobs, tackling poverty, protecting the vulnerable and ensuring high quality services for people across Wales. “Overall, the scale of revenue reductions is significantly less than those we faced in the last Autumn Statement. 

However, when the reductions and increases are taken into consideration there is marginal change to our budget allocation for 2014-15 and 2015-16  - but there is little additional resource available to support our priorities.   “There were several announcements in the Autumn Statement about Business Rates in England – which account for a significant proportion of our revenue uplift.  The announcement of an extension to the Small Business Rate Relief Scheme is something that Welsh Government Ministers have pressed for.  The Welsh Government will now take stock before determining the way forward in Wales.

“The boost we have received to the financial transactions facility is welcome and we will consider how best to use this in the context of our Wales Infrastructure Investment Plan.  The news on Wylfa Newydd is clearly welcome. “We now need to look carefully at the details as we cannot replicate increases in our budgets without replicating reductions.  But our decisions will reflect our priorities for Wales. 

“At a time when many people are struggling to make ends meet we know the further changes to the welfare system that have been announced today will impact heavily on many vulnerable individuals and families across Wales. “Our Final Budget proposals for 2014-15 are shaped by our priorities and reflect the tough decisions that we have had to make.  Today’s announcement does nothing to change those priorities. 

We remain committed to doing everything we can to help people in Wales managing tough household budgets with rising costs, and we will continue to support people in the best way we can.” 

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