There have only been two Welsh Grand Committees in almost four years since July 2014. If a day is a long time in politics, four years is an age. I will not even try to articulate the changes that we have seen in that time, or say what the world looked like back then, except to say that Boris Johnson was still claiming credit for the London Olympics, David Cameron was still pretending to have a long-term economic plan, a European referendum was Nigel Farage’s dream, and Donald Trump was a rich but harmless reality TV star.
In real terms, we have seen positive changes to Wales’s representation in Westminster—three new Labour MPs are standing up for Wales as a result of the snap general election last year. My hon. Friend the Member for Gower (Tonia Antoniazzi) won back her constituency, overturning the narrowest Tory majority in the UK of 27 votes with a thumping 3,269 majority. My hon. Friend the Member for Cardiff North (Anna McMorrin), my fantasmagorical Parliamentary Private Secretary, won back Cardiff North from the Tories with a majority of 4,174, and my hon. Friend the Member for Vale of Clwyd (Chris Ruane) returned to the green Benches, winning back the seat that he held from 1997 and lost by 237 votes in 2015. We are so pleased that he came back in 2017 with a majority of 2,379, after a two-year sabbatical promoting mindfulness around the world. I am so grateful that Mr Statistics, as he is known, agreed to be my shadow Minister.
Since the last Welsh Grand we have a new Secretary of State for Wales—he is rapidly approaching becoming the longest serving Welsh Secretary over the past eight years. I teased the new Under-Secretary of State for Wales during Welsh questions, so I shall move swiftly on before Mr Owen gives me the evil eye again.
We are here today to discuss the autumn Budget of 22 November and its impact on Wales. A famous Welsh Labour politician once said that politics is the “language of priorities”. That sentiment is never better displayed than in the setting of a Budget. Considering what Wales got out of the autumn Budget, we would be forgiven for thinking that this might be a brief sitting. I want to describe how a transformative Government Budget could be created, in the right hands. A Budget can be progressive and social. It can articulate investment in vital public services, demonstrate support for key industries and ensure that money is spent to benefit the many, not the few.
The famous Labour politician I mentioned was of course Nye Bevan, who knew that politics, power and responsibility come down to one thing: priorities. It is in their Budgets that Governments reveal their priorities. The autumn Budget revealed that Wales is not one of the UK Tory Government’s priorities. In the right hands, a Budget for Wales could deliver investment and the greatest good for the greatest number: money for the NHS, local government, education, and skills; investment in projects to tackle youth homelessness and to improve air quality; support for small businesses and business rate relief; funding to promote our language, which is a cornerstone of our culture, and for a growth in the use of Welsh in schools and colleges across the country; and a 21st century schools capital investment programme, investing not only in facilities but in our children’s future. That is a Budget. That is what a Budget can achieve when power is put in the right hands for Wales.
Of course those are not just warm words or hopeful rhetoric. They are the commitments of a Welsh Labour Government budget published less than a fortnight ago—a radical, progressive budget for the many, not the few. However, the Welsh Labour Government are working with one hand tied behind their back. Why? Because the failing Tory UK Government continue to press on with their futile and unnecessary austerity measures, impose cuts on the Welsh Labour Government’s block grant, and let Wales down.
Welsh Labour called on the Chancellor to end austerity and fund the Welsh Labour Government properly, enabling them to invest further in Welsh public services. He failed to do that. We demanded that he provide new funding to lift the public sector pay cap in Wales, which is hitting public sector workers year after year. He failed to do that. The autumn Budget—the Chancellor’s first since the change of pattern—shows once again the contempt and disregard that the UK Tory Government have for Wales. It is a shameful catalogue of missed opportunities, shot through with a callous disregard for the communities and people in Wales most in need of support.
Let me demonstrate the appalling attitude to Wales shown by the UK Tory Government through a budget that embodies this disdain. More than half of the new funding announced for Wales will have to be paid back to the UK Tory Government. Two thirds of the additional capital funding is made up of a form of funding called financial transactions, which must be repaid to the Treasury. There are also restrictions on what it can be spent on. The Welsh budget has experienced year on year cuts as a result of the UK Tory Government’s ongoing ideological programme of austerity. There is an ongoing battle between the social democratic values of the Welsh Labour Government versus the neoliberal ideology of the UK Tory Government.
Even with these small increases in funding, our budget will still be 5% lower in real terms in 2019-20 than it was in 2010-11, which is equivalent to having £900 million less to spend on public services in Wales. If we exclude the financial transactions funding, which we will have to pay back, our budget will be 7% lower, or equivalent to £1.1 billion less by 2019-20.
Wales has been let down elsewhere too. The Welsh Labour Government have repeatedly called on the UK Tory Government to fully fund a pay rise for all public sector workers. The UK Tory budget was a missed opportunity to do just that. The Welsh Labour Government have called on the UK Tory Government to invest in key infrastructure projects in Wales, including the Swansea bay tidal lagoon, which has been mentioned before, and rail, but the Chancellor once again turned his back on Wales. The only feedback we have had on the tidal lagoon is the vague point about value for money that was trundled out again last week and today, despite the UK Tory Government’s independent Hendry review recommending its support as a no-regrets decision. The Secretary of State has told us that Welsh Labour Government and UK Tory Government officials met to discuss the tidal lagoon, but what about the UK Tory Government decision-makers? When are they going to front up and put up? The Secretary of State knows that the Welsh Labour Government have pledged millions to support the Swansea bay tidal lagoon.
The UK Tory Government have cancelled the electrification of the main line from Cardiff to Swansea, as mentioned by my hon. Friend the Member for Caerphilly (Wayne David). None of their explanations for doing so make economic or environmental sense. If the UK Tory Government had kept their promise to electrify the main line from Cardiff to Swansea, we would not have needed bimodal trains, which are heavier because they need to carry both sources of power, making each journey more expensive. The heavier trains increase wear and tear on the track, the buffet car has been taken out to make 130 more seats, and so on.
There has been no devolution of air passenger duty to Wales. Last week at Wales questions, the Secretary of State failed once again to answer a question put by the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) about devolving airport taxes. Building on the excellent work of Visit Wales, the Welsh Labour Government would be able to use the control of air passenger duty to support and promote Welsh tourism. Anyone who visits Wales will agree that it is spectacularly beautiful.
If I were being magnanimous––I am a very gentle, understanding person––I could mention something that the Tories did include for Wales in their Budget. They announced that the Severn bridge tolls will be scrapped by the end of next year, following an immediate cut to various charges. What they did not tell us is that the drop in toll prices is merely down to the removal of VAT, because legislation, rather than political priorities, dictates that VAT cannot be charged once the bridges have been brought back into public ownership. Who is to say that the Tories will not break yet another promise and fail to remove the tolls, even though it is difficult to do a U-turn while driving on the Severn bridges?
We urge the UK Tory Government to pause and fix universal credit, which is creating appalling poverty, debt and desperation for families across Wales. They choose not to, instead tinkering around the edges of a broken system. We ask the UK Tory Government once again to join Welsh Labour and support business, infrastructure and innovation, for on each and every one of these, Wales has been let down once again. On the crucial issue of the north Wales growth deal, after sustained pressure from Welsh Labour MPs and the Welsh Labour Government, the Chancellor indicated that discussions would begin to take the project forward. I am pleased to hear that that is going to happen today.
The UK Tory Government’s claims of an extra £1.2 billion for Wales are pure smoke and mirrors. The truth is that the real uplift to the Welsh budget is significantly smaller. In 2022, after nearly 12 years of UK Tory Government rule, UK GDP is forecast to be £41 billion, or 3%, lower than previously predicted. The Office for Budget Responsibility has downgraded its growth forecast for each of the next five years. That means that Wales will be significantly worse off than previously thought. That will have an impact on tax receipts, which will be £26 billion lower by 2022, there will be higher borrowing, and less funding will be available for public services.
All that is a direct product of the UK Tory Government’s ideological commitment to the failed and damaging policy of austerity. Despite eight years of Tory austerity, continued cuts to the block grant of more than £1 billion in total and the UK Tory Government continually letting Wales down, the Welsh Labour Government continue to do a remarkable job. They have led the way on sprinklers, plastic carrier bag charges, free bus passes and prescriptions, and opt-out organ donation. Our Welsh Labour Government continue to protect and invest in frontline services, and continue to work to protect our communities against the cruellest excesses of UK Tory Government cuts. That work will be much harder following November’s weak and desperate Budget from a UK Tory Government who simply do not care about Wales. At the end of the day, there is a saying in Wales: “Cymru yn arwain, eraill yn dilyn.”
