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Chancellor’s statement ‘signals a new era of austerity’ Welsh Government says

17 Oct 2022 4 minute read
Jeremy Hunt picture by No 10 (CC BY-NC 2.0).

The new Chancellor’s latest financial statement shows “the chaos at the heart of the UK Government,” and signal “a new era of austerity,” Welsh politicians have said.

Chancellor Jeremy Hunt has announced that the two-year energy price freeze for all households will now run for just six months, with campaigners warning that the move will lead to a steeper “cliff edge” for households.

The new Chancellor also said that he is abandoning plans to cut the basic rate of tax by 1p – which had been due to be brought forward to April – and that it would remain at 20p in the pound until the country can afford to reduce it.

The cut in dividend tax promised by his predecessor will also go, along with VAT-free shopping for overseas tourists, the freeze on alcohol duty and the easing of the IR35 rules for the self-employed.

Rebecca Evans, the Welsh Government’s Minister for Finance and Local Government, said: “The complete unravelling of the mini-budget shows the chaos at the heart of the UK Government.

“In the space of six short weeks the UK Government’s reckless and flawed economic policy has caused mayhem in the financial markets, pushed up mortgage costs and stretched household budgets even further.

“Now the UK Government is rolling back on its energy price support scheme for households, something that will only add to the uncertainty people are facing as they worry about paying their bills.

“The new Chancellor has signalled a new era of austerity to start to fill the hole in public finances. We will all pay for the government’s mistakes. But this is a crisis made in Downing Street and one it needs to address.

“The Chancellor needs to use his next financial statement to provide reassurance we will not see the deep spending cuts that will affect jobs, services and our economy – and to provide support to vulnerable households who have been ignored today.”

‘More painful austerity’

Plaid Cymru Westminster leader, Liz Saville Roberts MP said: “The acting Prime Minister Jeremy Hunt, under the guise of ‘fiscal responsibility’ is planning on imposing more painful austerity on the public. The Tories have trashed the economy and are now set on forcing the poorest to pay the price once again.

“Westminster is in utter disarray – unable to give any certainty to families facing extortionate bills and rocketing mortgages. Many have budgeted under the understanding that their energy bills would be capped for two years. Backtracking on that promise is unforgivable.

“Labour’s naivety in acquiescing to the biggest tax cut of all – the basic rate of income tax – was deeply disappointing. Plaid Cymru opposed this reckless tax cut as we strongly believe in properly funded public services.

“Meanwhile, the Scottish Government is today outlining plans for a fairer, greener economy through independence. This Westminster circus must make us in Wales recognise that we too can have a more stable and prosperous future with independence.”

‘Despicable damage’

Welsh Liberal Democrat Leader Jane Dodds said: “Hunt’s statement points to the despicable damage that the Conservatives continue to wreck on households, businesses and individuals. All his statement today has done is cause wider uncertainty for households and the businesses sector.

“The Conservatives are trashing the economy with every day that passes and creating havoc for peoples’ mortgages. Now they are planning to inflict even more suffering by raising energy bills, hiking taxes and slashing crucial public services. These service cuts will see knock-on effects to the Welsh Government as budgets for key departments like education and health may be squeezed even tighter.

“What’s worst is they are still determined to protect oil and gas giants from a proper windfall tax and they are still cutting taxes for the big banks.

“Truss, Hunt and Kwarteng are symptoms of a wider problem. This entire Conservative party is out of touch. That’s why we need a General Election to remove them from power and put an end to this devastating crisis.

“The people of Wales quite frankly deserve better from their elected officials than an ongoing pantomime that was never funny to begin with.”


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Mr Williams
Mr Williams
1 month ago

And apparently, we are better off in the UK.

HOW??

Gareth
Gareth
1 month ago
Reply to  Mr Williams

HS2 of course, and there will, be a ” cross rail 2″ in London where £14 billion has been earmarked for the project. Cymru has never had it so good. ( note to myself, close sarcasm mode).

hdavies15
hdavies15
1 month ago

The hefty spend during Covid was bound to have its consequences so some tightening of the strings was to be expected especially with a bunch of unsympathetic draconians in charge. No doubt the aid now being allocated to energy will be cut back much sooner even though it will hurt people who can least afford to be doing without. Unless of course yet another U turn concludes that those with incomes over a certain level and more than one property (holiday homes) will get a base level only or be excluded. Now that Hunt has the bit between his teeth… Read more »

Stephen Mahoney
Stephen Mahoney
1 month ago

What a mess eh! This budget was the pinnacle of brexit ideology with a nitrous boost for good measure, supported by farage, paddy flynn, Hannon, the mail, the express and the telegraph, an eff the markets, in your face jonny foreigner programme of unfunded, England will do what it likes fiscal intent. So much for the English getting their country back, so much for treasured sovereignty, a country with a floating currency a huge sovereign debt and trade deficit, just expected the markets to roll over and finance this un-costed and unfunded madness without raising a premium on UK gilts or shorting sterling,… Read more »

Mab Meirion
Mab Meirion
1 month ago

Back to Tory Fiscal Responsible Government, put the smirk back into it, Osborne’s austerity is just what the doctor ordered…unlike you ordering enough of the right PPE for a pandemic eh! Hunt or whatever your name is…’your actions’ go before you and the sooner you go before a judge and jury the better…trust this vacant smiler at your peril…

Last edited 1 month ago by Mab Meirion
Frank
Frank
1 month ago

Pensioners cannot afford to wait until next April for a pension increase. We need it now. This bunch of loonies are ruining the country. They haven’t a clue. One thing is for certain though…. they won’t feel the pinch!!

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