4. Statement by the Minister for Finance and Trefnydd: Future Outlook for Public Spending in Wales

Part of the debate – in the Senedd at 4:52 pm on 16 July 2019.

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Photo of Llyr Gruffydd Llyr Gruffydd Plaid Cymru 4:52, 16 July 2019

I don't share Nick Ramsay's jovial outlook, at the moment, I have to say; I think austerity is causing all sorts of problems and untold damage to individuals and communities, and the erosion of support and services to people across Wales, and, of course, there's not much prospect of change in that respect. Only in May, Paul Johnson, the Institute for Fiscal Studies director wrote in a report, and I quote:

'Leaving the EU would most likely increase borrowing by between £20 and £40 billion in 2019-20. Getting to budget balance from there...would require an additional year or two of austerity at current rates of spending cuts.'

So, prospects aren't as good, maybe, as some people would wish they were. And, of course, we can add to that the concerns as to whether Wales will be receiving replacement funding from the UK Government for what we're currently in receipt of. I mean, they made promises around the pensions issue, which was highlighted to be misleading, because we didn't get the money at the end of the day. So, there are real concerns, but, of course, I don't want to hear from the Minister what the problems are; I know what the problems are. What I want to know is what are you doing to address and tackle some of those issues. So, what negotiations are you having with the UK Government in relation to future funding? We know the ambiguity or the evasion around committing to the shared prosperity fund. Well, what are you pursuing, therefore, to ensure that we get some sort of clarity? 

Lesley Griffiths, the rural affairs Minister, told us only a couple of weeks ago that she had no idea how much money she was going to get, if any money at all, if there was a 'no deal' Brexit. So, we just need assurance from you, as Minister, that you are leading the charge from the front and not just shrugging your shoulders and saying, 'Well, we don't really know what's going to happen and it's all doom and gloom.' I think we need to hear that, actually, you are taking the fight to the UK Government.

Now, Boris Johnson's recent comments around what he would like to do with money being spent in Wales is also cause for concern, of course, and I'd like to know what you're doing to ensure that any UK Government infrastructure spend is actually complementary to Welsh priorities, because there is a danger that we end up with some sort of incoherent financial posturing between the Welsh Government and the UK Government trying to outdo each other without it being joined up, really, and we need to make sure that you do work coherently in order that we get the best bang for our buck.

Focusing on the Welsh Government plans to release its own budget, of course, we were hoping to see a bit more of a definitive shift in terms of responding to the climate emergency in the supplementary budget published previously. I understand it's a tidying-up exercise, is what people tell us, so I am hoping that the next budget that will appear at some point in the autumn will show a palpable shift in terms of resources to address the climate emergency. We haven't seen any costings to the Government's low-carbon delivery plan, of course. I'm just wondering, given that the future generations commissioner did some work on last year's budget that identified that only 1 per cent of that budget was actually earmarked for direct action to tackle climate change, whether we will see, as I say, that palpable shift in terms of resources towards decarbonisation as well. I'd like to hear from you what your plans are in that respect.

I also want to ask about multi-annual budgets. I know that the Welsh Government isn't afforded that luxury by the UK Government at this moment in time, but, of course, we do see in Scotland the Government there include aspects of multi-annual budgets in their budgets. Most recently, they included multi-year allocations for early learning and childcare and digital connectivity, so I'd like to know whether the Welsh Government will be incorporating elements of multi-annual budgeting in your next budget, despite, of course, doing that in very difficult circumstances.

Finally, you say in your statement that health will continue to be your priority for funding. Well, what I want to know is how will your budget further pursue a preventative approach, because, again, the future generations commissioner has highlighted how 94 per cent of NHS spending in Wales goes on acute and tertiary services. So, are we going to see that starting to change as you put that greater emphasis that you tell us you want to put on the preventative approach?

Of course, the ultimate preventative approach, I suppose, is to invest more in education, ensuring that our children and young people grow up being more aware of the importance of their own well-being, healthier lifestyles, being socially responsible citizens, understanding what environmental impact their actions might have. So, when will the Welsh Government confront the funding crisis in our schools, and will you ensure that schools have the resources they need to be able to deliver those outcomes that we all want to see?