‘New era of austerity threat to Wales due to UK Government’ says Finance Minister
Wales is facing a new era of damaging austerity cuts because of the UK Government’s mismanagement of the economy, Finance Minister Rebecca Evans has said.
The combination of soaring inflation which is eroding the Welsh Government’s budget, and spending cuts threatened by the latest Chancellor of the Exchequer, could starve public services of funding, stifle economic growth and lead to job losses, she said.
The Welsh Government’s budget is now worth up to £4bn less in real terms than it was when the three-year funding settlement was set last year, their own figures show.
The Chancellor of the Exchequer, Jeremy Hunt, has said that all UK Government departments must redouble efforts to find savings and warned some areas of spending will be cut to fill the hole created in UK public finances by the fallout from the mini-budget a month ago.
This could mean more cuts in funding for the Welsh Government, as it prepares its draft Budget, which is set to be published on 13 December.
The Chancellor is due to produce his medium-term fiscal plan on 31 October.
Speaking at a Welsh Government press conference later today, the Finance Minister will warn against another round of destructive austerity and outline alternative options the Chancellor could take to boost growth and support public services.
Rebecca Evans, Minister for Finance and Local Government, is expected to say: “By announcing reckless uncosted tax cuts for the rich, the UK Government lost control of the economy. Now the new Chancellor wants us all to pay for its failures with deep spending cuts.
“We are facing a new damaging era of austerity, which would threaten jobs, businesses and public services.
“The Chancellor could protect public services by using his tax levers more fairly and increase investment to get the economy moving in the right direction. He could help people pay their bills by increasing benefits in line with inflation.
“As we look ahead to our Budget, we need the UK Government to take action to avoid the type of destructive austerity that will further damage our economy and the public services so many of us rely on.”
Chancellor Jeremy Hunt, who was brought in to steady Ms Truss’s ailing Government and has been working towards a highly-anticipated Halloween fiscal statement, is widely expected to keep the keys to No 11 under Rishi Sunak to try to stabilise the jittery markets.
He has warned of “eye-wateringly difficult” decisions on tax and spending signalled a shift away from Boris Johnson’s 2019 promise of an end of austerity.
Yesterday he tweeted: “This is a time for honesty about the huge economic challenges we face, and courage in addressing them. We have a PM who can be trusted to do just that”.
Last week, Jeremy Hunt said universal energy support for households, which has capped bills for a typical household to £2,500 a year, will end after six months and then be replaced by more targeted support.
Mr Hunt also scrapped a number of policy announcements from predecessor Kwasi Kwarteng’s mini-budget, such as plans to reverse a proposed corporation tax rise, after it had resulted in a sell-off of Government bonds, called gilts.
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Far worse than written above. We face a double whammy or more. Of course there are those constraints that are placed by biased policies and budget allocations from Hunt & Co from London. Then on top of that we have the confused and misdirected efforts of the Bay regime who just haven’t got a clue when it comes to getting the best out of scarce resources. Living with one duffer is bad, having two is unbearable.
Can someone please tell me why Mark Drakeford et al still desperately want to be part of the union with England. Is this his idea of an insurance policy?
Welsh Labour bleating again! Whimpering in the corner for the last 100 years, blaming the English for not giving us enough money. Do something about it FFS! Stop this begging mentality it is belittling our country!
According to that little twerp coward Drakeford, this is our insurance policy.
The reckless uncosted tax cuts she refers to were reversed before anything happened. The country’s finances are in a mess because of the Covid spend with Ukraine making things worse.
AND gross Tory incompetence and criminality. Worst performing economy in the western world (that all also experienced Covid and the Ukraine invasion