5 things the UK Government could do in 2018 to help reverse Wales’ decline

Picture: National Assembly (CC BY 2.0)

Leanne Wood

As we mark the beginning of a new year, we have reached the point where half of the world’s wealth lies in the hands of 1% of the global population.

Possibly not the most cheerful new year’s message but it is nonetheless a striking fact which lays bare the need to tackle this gross inequality.

While it is one of the wealthiest states on earth, the UK is not immune from this scourge of deep income inequality which sees poverty and privilege living side by side.

Our all-Wales agenda provides a vision for spreading prosperity and opportunity. We know we can be different to this – we don’t have to be a country where rural and urban communities are pitted against each other as services are cut and town centres stripped of vital facilities.

So, what can be done?

While all attention in Whitehall focuses on all matters related to Brexit, we will not allow the UK Government to shy away from its day to day duties when it comes to providing meaningful employment to fuel a strong economy.

Stagnant wages and slumping productivity rates pre-date Brexit and will outlast it too unless radical action is taken to rebalance the economy and prompt a much-needed rise in living standards.

Here are five things the Prime Minister and her Cabinet could do in 2018 to help overturn a decade of decline in Wales:

  1. Commit to the single market and customs union

The benefits of single market and customs union membership for Wales are unquestionable. 200,000 Welsh jobs are linked to the European single market while no other nation in these islands sends more of their exports to the EU.

As negotiations move to their second phase set to focus on trade, now is the time for her to make a firm commitment to the thousands of workers and businesses in Wales and beyond who would lose out should the UK sever its most important economic ties with the EU.

If the most ardent right-wing Tories get their way we will career towards an extreme Tory Brexit that will see workers even worse off than now, while trade deals are designed to line the pockets of City fat cats.

  1. Invest in infrastructure

Wales’s transport network is outdated and in urgent need of an upgrade. Our roads and railways are wholly inadequate and unable to cope with increasing commuter numbers.

Plaid Cymru has long made the case for extra capital investment in Welsh infrastructure of 1% of UK GDP, equating to around £20bn. This would mean an additional £1bn a year for Wales to invest in properly connecting our country with transport links fit for the 21st century.

The Westminster government is not only guilty of chronic underinvestment in Wales but also of backtracking on promised proposals.

Be it cancelling the electrification of the main line to Swansea or going cold on the Tidal Lagoon, the Prime Minister must right these wrongs and deliver these long overdue projects for Wales.

  1. Prioritise deprived areas for investment

The ‘boom and bust’ economic model pursued by Labour and Tory governments in Westminster has seen the wealth gap between the nations and regions of the UK grow.

The Chancellor should bring in an Economic Fairness Bill to proritise deprived areas for investment to rebalance the economy – a principle applied successfully in Germany during the 1990s.

At present, a disproportionate amount of money is ploughed into London and the south east of England leading to the economies of these areas overheating while Wales is left behind.

  1. Deliver tax justice

The blight of tax avoidance and evasion has seen the Treasury lose out on at least £2bn a year for nearly the past decade.

However, the tax gap i.e. uncollected taxes is far higher at around £34bn in 2015/16 – more than double the entire annual Welsh budget.

The Prime Minister should make it a priority to get to grips with a more robust and transparent tax system where those with the most bear the greatest burden.

A Financial Transaction Tax on bankers’ trading transactions, for example, would raise around £20bn a year.

  1. Empower employees

Much noise was made about then Chancellor Osborne’s ‘National Living Wage’ announced in the 2015 UK Budget.

While the Tory spin machine was in overdrive, it didn’t go unnoticed that this rebranding exercise fell short of the ‘real living wage’ of £8.75 an hour, as defined by the Living Wage Foundation.

People who are paid properly are more productive and have more money to spend in their local economies.

With so many people forced to rely on working tax credits to top up poverty pay, a real living wage is matter of economic sense and something the UK Government should adopt without delay.

Another powerful move, in principle and in practice, would be to appoint workers to remuneration committees.

This would give lower paid workers a greater say over decisions which affect their employment conditions and ensure better scrutiny of chief executives’ pay.

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16 Comments

  1. Graham John Hathaway

    There can never be a equality of resources and inspiration with a history of assest stripping of any and all colonies. To ask for investment at a time of major investment in English infrastructure HS 2, Trident, a National Health Service in crisis, a social care sector on its knees and a diminishing economy based on a service and financial sector is asking for gold dust. We’ve already been washed over on full electrification of railway lines and the crucial need for a metro style valley rail network is over powering. The case for the Swansea Bay barrage is beached or forgotten, and the reduction of EU funding on all things Welsh is diminishing. That loss alone is going to hurt spend on infrastructure , agriculture, education and business and other sectors not least the the third sector.

    We should be asking for investment, in the way outlined. It’s a route map. My concern is until we in Wales start to realise that only a fully fledged and fully funded National Assembly, with a full legislature, can we can begin to address serious issues hanging there like some cold hand of poverty and decay.

  2. Fine, as far as it goes, but it’s not just the Tories in Westminster that are responsible for the economic and social woes of Cymru. The massive elephant in the room, the Labour Welsh Assembly Government has done a stirling job since the inception of the Assembly in running our country down with nary a murmur of any real opposition from the likes of Plaid Cymru, who seem often to be more concerned with ‘ishoos’ and a malformed political correctness that is really just a form of censorship.

    It has often bugged me as to why Plaid Cymru hasn’t been going for Labour’s jugular. Time and time again PC misses opportunities to hammer home the way that Westminster interests, in the form of Labour’s WAG results in Cymru being a country that is becoming poorer by the minute, with economic performance declining all the time, apart from in one small corner centered around Cardiff. Where is Plaid’s alternative manifesto for a better Wales? All we seem to get are soundbites, and articles full of fluff like this one. Where are the brainstorming manifestos of old that served as fuel for discussion as in the old days? Nowhere on the Plaid website can I find a downloadable copy of Plaid’s detailed manifesto, or any kind of in depth discussion of ideas that could really inspire. All Plaid seems to think it has to do is to out Labour the Welsh Labour Party and all will be well. Not so. The people of Cymru need so much more than a rehash of the same tired old ideas that basically say, once again, that we must go, cap in hand to English government and ask for a bigger handout.
    .
    The list of demands is fine, but you might as well ask for the moon as there is about as much chance of getting that as having all those wishes granted. I’d even go so far as to suggest that the last part, the bit about empowering employees is pretty much out of date, and also contains some somewhat misleading information. Let’s make it quite plain, the Tories are lower than vermin, and their playing around with semantics over the national minimum wage is nothing short of disgusting, but hey, this what we expect from Tories. However, nowhere was is mentioned that the £8.75 an hour ‘Living’ (sic) Wage is actually only a living wage once Tax Credits are taken into consideration. Tax Credits start to come to an end in February with the rolling out of Universal Credit, the Tories hatchet job on the benefits system, which has been deliberately designed to impoverish millions of ordinary people with it’s sanctions and and a conditionality that is not only draconian, but has been framed precisely so that people will fail it and thus be sanctioned, which will make plunge already economically precarious people into, not just poverty, but destitution. Nothing said on that in this article.

    There needs to be reform in how poverty is addressed, but this, in my opinion, needs to be more along the lines of an unconditional basic income and a minimum wage somewhere around at least £10 an hour. Bigger companies will easily be able to afford this, and the subsidies, (tax credits etc) currently benefitting the likes of Tesco etc, could be more focussed on the small employers that would struggle to pay such a solidarity level of wage. There are many other things that affect peoples ability to eke out an existence, let alone enjoy something called a life. Rents spring to mind, and here I’m thinking more in line with the way that social rents, (councils and housing associations) have increased in recent years to obscene levels. The housing association rent I pay has increased by a full 50% since 2011, which means that is has increased at a rate way above inflation. If my rent has increased by that much, then it’s likely that everyone else’s social rent has increased. Our politicians seem to have their heads stuck in the sand, or somewhere else dark. We need them to start to really listen to us, and to star taking us seriously, which means we need to be part of the conversation. It shouldn’t be a case of going to organisations such as the Living Wage Foundation to ask about adequate wage levels, but asking ordinary workers, or creating a debate around wage levels. Ditto with housing, don’t go to some out of touch middle class dominated third sector organisation like Shelter, but go directly to independent tenant’s groups, as only ordinary tenants have any real clue about what they can afford to pay in rent – indeed, I’d go so far as to suggest that social housing should be directly controlled by tenants, and not supercilious and overpaid housing professionals who largely treat tenants with disdain. Housing associations should primarily be answerable to their tenants, and not the Welsh Assembly Government, which is so obviously the case at present.

    Where is the robust opposition that Plaid should be? I understand that there are limits in that the party isn’t in power, but it should be aware that it does have the power to inspire. It’s just a shame that Plaid no longer inspires as it perhaps could, in the way that the Plaid of old did with the ideas of Dr D.J. Davies that were published in the book “Towards Welsh Freedom” way back in the mid 1950s

    • I’m glad you took time to write all that because most of it fits neatly with my thoughts. Indeed I might even be happy if I did not not agree with you or anybody else on a personal level so long as I see Plaid growing a pair and getting stuck into a sustained critique of this Labour maladministration which we have endured for nearly 20 years with little or no progress. Now that’s a whole load of frustration, isn’t it ! Rolling out a regular item by item review, picking up on defects, commending the occasional good bits and building its own detailed alternative is how it should be done. One suspects there is a great deal of intellectual laziness at Y Cynulliad spread around all the parties but that’s no excuse for Plaid catching that disease off other parties whose main focus is Westminster anyway.

  3. I agree with most of what you wrote Leanne, please take on board the constructive criticism. Only today, I have an email (from a reliable source) that the UK government is considering signing up for TPP, the trans-pacific free trade block. This includes Australia and New Zealand !! New Zealand produces cheap lamb which will be a disaster for our farmers. If they, the UK, did sign for TPP then the only solution for Wales would be to leave the UK and possibly rejoin the EU which is our largest export market. Let England have their substandard lamb; Wales should go organic and produce the best.
    The time is coming when Plaid Cymru needs to become the large leading movement of Wales ( Are you up to it? ) Because Wales needs a movement right now to represent the real interests of the people of Wales. If you are ready I will be onboard.

  4. Gareth Williams

    We should hold a referendum but this time based on facts not fiction. Remeber that around 70% did not vote to leave, and 49% voted to stay. Plaid is pro Europe so why not fight that corner. Leaving will be a disaster for Wales. Pro Europe could unite a lot of people in Wales as the Labour party ar to weak to stand up for what is right so Plaid should take on that fight.

  5. Leanne is right in pointing out that the gap between 1% (financial oligarchs) and everyone else continues to grow exponentially. She fails however to state the reason why. I suspect that she doesn’t understand why. This in turn explains why her suggested remedies will have little effect, even if they could be enacted.

    Leanne is not alone. Recent research discovered that 85% of Westminster MP’s don’t understand the how money system works, many believing things that are false. Most MP’s don’t even know where money comes from. (It doesn’t come from governments.) See: http://positivemoney.org/2017/10/mp-poll/

    Because of these deeply held beliefs that are actually false, we continue to think of running governments, public services and the economy in general like a household budget. It makes common-sense. Everybody can understand it. But it is wrong. Basing your solutions on a misunderstanding of the problem will only delay the pain, not solve the problem.

    While our political elites remain trapped in ‘flat-earth’ economics modelling we will grow weaker and poorer as our collective and private debt-burdens increase.

    I am currently working on a project to bring sense back to the debate on economics and money. Only when we understand how the system actually works can we formulate and launch programmes that turn the tide in our favour. Until then we will remain on a slow road downhill to debt-slavery and destitution. Isn’t it time we turned this boat around?

  6. Let’s first reclaim our sovereignty and demand the return of our legal and judicial system, to do so will not incur any financial burden on the UK economy. Only when Wales is sovereign again can we rebuild both country and economy. Anything else is pie in the sky.

  7. Eos Pengwern

    The only fiction being peddled in the 2016 referendum was coming from the Remain side: all that guff about the economy crashing and the need for an emergency budget to ameliorate the damage. The Remain side couldn’t possibly have painted a bleaker picture of life post-Brexit but you know what? Leave won anyway.

    [OK, there was that thing about the £350 million per week, but the only thing wrong with that figure was that it left out Mrs. Thatcher’s rebate; so at the end of the day, the UK is still shelling out a net £250 million a week to the EU, and Mrs. Thatcher is still saving the country £100 million a week even 25 years after she left office. Pretty good going if you ask me].

    Anyway, as for Leanne’s article. Oxfam trot out that trope about the top 1% owning half the world’s wealth every year, so we’ve hardly ‘reached the point’. Even if it’s true, what difference does it make? The past 20-30 years of allegedly-increasing inequality have seen people all around the world being lifted out of poverty at a faster rate than ever before in human history. That’s something to celebrate. Meanwhile, Bill Gates and Jeff Bezos have done a great deal more to raise living standards in Wales than Plaid Cymru ever have, so I don’t grudge them a cent of their billions. Envy is an ugly emotion, and a very bad thing to base one’s politics on.

    Beyond that, she’s right about the need to redirect Welsh tax receipts to investment in Welsh infrastructure rather than London infrastructure, and prioritising investment in deprived areas, but that’s about all. The sooner we’re out of the single market and customs union the better, and then you never know – perhaps our agriculture will boom as much as New Zealand’s has since it was freed from agricultural subsidies in the 1980s. Our tax avoidance industry is a direct consequence of our grotesquely complex tax system, designed to be ‘progressive’ but in fact all it does is to place the heaviest burden upon the people who are the most productive and the most able to avoid it. Likewise our grotesquely complex benefits system. A flat tax and a citizens’ income are the way to go.

    But if we really want to reverse Wales’s decline relative to the rest of the UK, as Sibrydionmawr has eloquently said (though I don’t agree with everything that he or she has written), the first step is to get rid of the crassly incompetent Labour administration that has run the place since Devolution: something that Plaid Cymru has abjectly failed even to attempt, inexcusably propping them up instead. Until Plaid Cymru cease being Labour’s ‘mini me’ and get serious about unseating them, no matter who they have to ally with in the process, they cannot be taken seriously as a nationalist party.

    • Eos what are you chatting about….absolute rot ….. you believe that con job of philanthropy …..What has Jeff Bezos done for Wales?

      You say Plaid cymru has done nothing for Wales and Bill gates has done more….the difference is Bill gates and Bezos made vast money off the backs of their workers.

      And they are smug ones who are allowed to decide how the money is spent (clue: not for welsh interests)

      Have you thought through the structure of the world we live?

      “dont be jealous”…..of course I am jealous !!!! The workers should part own their work places….that is real wealth creation…..not your lover boys in uncaring corporations

    • “Bill Gates and Jeff Bezos have done a great deal more to raise living standards in Wales”

      Outright lie … total rubbish – give us concrete evidence for that bold statement

      • Thanks to Bill Gates I can use a reliable computer that makes me far more productive than I’d ever be without it, and so raises my salary and improves my standard of living. I can work from a rural location in Wales, doing the sort of work which a generation ago I’d only be able to do in the centre of a large city (and more than likely an English one at that). I can even do so using a user interface entirely in Welsh, which the company Bill Gates founded fully supports.

        Thanks to Jeff Bezos I can buy, from anywhere in Wales, the sorts of things from obscure books to high-value items that a generation ago I’d have had to travel to London to buy. I save a fortune in travel costs, and even more importantly time, which I can spend working (further improving my standard of living) or on other things which are much more fun than taking trains to London.

        Therefore both men have vastly improved the quality of life that I, and everyone else in Wales, can enjoy. Along the way they’ve provided high-value employment to hundreds of thousands of people all over the world, and contributed to the globalisation revolution which, as I said in my first post, has raised billions of people all over the world out of poverty at an unprecedented rate. Thank you Gentlemen – you have earned your fortunes and you are entitled to them.

        • Graham John Hathaway

          To seriously believe any one individual can be responsible for wealth creation attributed to anyone or all countries is self delusional at its very best. Those therefore who built the Titanic, or the motor car, or invented the bomb is responsible for countless deaths. This borders the ridiculous and stretches fantasy of the Mikey Mouse cartoons.
          If you use such reductionist propaganda of how the £350m for the NHS is some how irrelevant, or consequences of even thinking of leaving the EU is already impacting on all forms of life, then what you write is for the birds. Total one eyed prejudice.

          Just for consumption. All wealth generated is a product of the community in which we are raised. Get real.

  8. Why ask Westminster for this when you know the answer is “NO”.

    Number 6 on the list should be “Westminster gives Wales the power to self rule and create its own wealth….and for Cymru not to be dependent on a frankly uncaring UK”

  9. Mae’n flin gennyf ond mae hwn yn erthygl di-bwrpas. Does dim byd yma na wyddwn yn barod. Yr hyn fyddai’n well i’r Blaid ac i Gymru fyddai gweld y 5 peth mae Plaid Cymru yn mynd i wneud am hyn, ac y gellir ei wneud nawr, er enghraifft: 1. Stopo llyfu Llafur a dechrau bod yn wrthblaid yn y Cynulliad gan dynnu sylw cadarnleoedd Llafur at gamweddau’r blaid honno a hynny mewn dull effeithiol. 2. Gwir ddadlau dros annibyniaeth i Gymru a chreu strategaeth i ymgyrraedd at hynny 3. Sicrhau bod pob Awdurdod Lleol sy’n cael eu rhedeg gan y Blaid yn pwrcasu’n llwyr yn lleol, yn gwrthod toriadau ac yn parhau i wario a chreu cyfalaf a ddim yn taflu arian at ymgynghorwyr allanol, yn gweinyddu’n llwyr yn fewnol yn Gymraeg ac yn gwrthod TAN 20 a thempledi cynlluniau datblygu lleol y Llywodraeth. 4. Yn mynd yn ôl at barchu a datblygu canghennau lleol sydd ar hyn o bryd yn edwino gan hefyd addysgu Plaid ‘Ifanc’ ynglŷn a democratiaeth, y dull di-drais a gwerth gwrando ar farn arbenigwyr 5. Yn ystyried Liz Saville-Roberts fel ein arweinydd.

  10. Prominent by it’s exclusion. I cannot find any reference to fighting for Independence and Freedom for Cymru in that nice little piece by Leanne. Perhaps she genuinely forgot to mention it. Being such an irrelevant little subject.

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