5. 4. Debate: The Second Supplementary Budget 2016-17

Part of the debate – in the Senedd at 4:03 pm on 7 March 2017.

Alert me about debates like this

Photo of Mark Reckless Mark Reckless UKIP 4:03, 7 March 2017

I thank Nick Ramsay for his contribution. The conclusion ‘we cannot support’ I thought was rather Delphic, since it leaves two possible interpretations.

The situation we find on this budget is that UKIP were not part of the Assembly at the time that the initial budget was passed for this year. A number of the changes from head-to-head or main expenditure groups are, I think, difficult to object to. I think we have a few particular issues. I concur with what the Chair of the Finance Committee said about the well-being of future generations Act. I must compliment the Cabinet Secretary, as he was at least well prepared, I think, for our questioning on that area as to how the well-being of future generations Act had influenced the formation of the supplementary budget. He told us about the £10 million for the Heads of the Valleys road—that was all about a more prosperous Wales—and then £16 million for the new treatment fund—that was all about a healthier Wales. So, congratulations on that, but I think we were still unconvinced as to the extent to which this Act really was drilling down and determining Government action to the extent that its plaudits would claim.

We had a very interesting, I felt, discussion at committee with the Cabinet Secretary about overruns within spending within the health MEG, and I think he made a compelling case as to why it was appropriate to fund those overfunds at the health MEG overall level. But, he didn’t want to increase the budget to recognise those overspends because that would reduce the incentive for appropriate spending control in future, but also because those overruns, I think, were particularly in areas that he thought on a needs basis were getting a higher degree of allocation. Certainly, if we were looking at income and health outcomes on a formula, my own area of south-east Wales perhaps had relatively less allocation before, and to recognise these overspends elsewhere would set that in stone, which we agreed was not an appropriate way forward.

The work on the infrastructure side—the £15 million for the eastern bay relief road—at least I think it is an improvement that we can then use Rover Way to get to that roundabout, but can the Cabinet Secretary say anything about when he proposes dualling, to complete what would in effect be a ring road for Cardiff, and make that £15 million itself much more productive in terms of its spending?

My major concerns—and I’ll be very interested in what the Cabinet Secretary says in response—again relate to the higher education funding settlement. In light of the evidence the Cabinet Secretary gave, the Finance Committee stated:

‘The planned technical transfer of £21.1 million from HEFCW’s budget to the budget line from which the tuition fee grant is now paid, was not implemented at the time.’

By which we meant in the final budget. Then, we said:

‘This Supplementary Budget reinstates this intended £21.1 million transfer’.

Is it correct that this a technical transfer, or is the Cabinet Secretary for Education right in what she said to the Children, Young People and Education Committee? She said:

‘I issued a revised remit letter to HEFCW on 17 October, making clear that the latest information from the Student Loans Company suggests expenditure on the TFG will be in excess of original estimates of £257.6m for 2016-17. We will therefore action the transfer of £21.1m from HEFCW to Welsh Government in the 2nd supplementary budget partly to cover the additional expenditure.’

So, is that transfer a technical matter, or is it being driven by the need to fund that cost overrun? Could the Cabinet Secretary also clarify what he describes as being formalised in this budget, which we referred to in the committee as an additional allocation of £20 million for HEFCW for a suite of measures to deal with current and future financial pressures relating to the implementation of the Diamond report recommendation? I mean, isn’t the Diamond review because we recognise that it was unsustainable to maintain the tuition fee grant as it was, and the costs of that were exploding, and that was going to be taking away from elsewhere in the Welsh budget? Why is it that, despite the Diamond review, we are still having the pressures, and the implementation of the Diamond review is yet another reason to find yet more money to put into this budget? Is the priority of his Government really to put as much money as possible into handing out student grants, rather than putting it into areas of the economy and infrastructure, and rather than putting it into the health service? It’s welcome that they’re no longer going on a means-tested basis to families earning £81,000, but still, does he really have the money, and is it really his priority to deprive other areas of spending so as to concentrate spending on this area, to such a very significant extent?