6. Statement by the Minister for Finance and Trefnydd: Implications for Wales of the UK Government's 2019 Spending Round

Part of the debate – in the Senedd at 4:15 pm on 17 September 2019.

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Photo of Nick Ramsay Nick Ramsay Conservative 4:15, 17 September 2019

You spoke about the uncertainty of Brexit. Of course, all debates have the Brexit angle at the moment, and, again, you are right to say that there are big uncertainties over Brexit and how we're going to exit the European Union and when, but that still leaves you with considerable ability yourself as a Welsh Government to manoeuvre and to plan and to make proposals for spending here that can improve the lives of the people of Wales and that is what we are here for.

Factually, you've stated the good news: the revenue budget will increase by just short of £600 million or 2.3 per cent in real terms above the 2019-20 baseline. And then there's also to be welcomed the £18 million increase in the capital budget, at 2.4 per cent higher in real terms. And the key wording in both of those instances is 'real'. So, these are real-terms increases, a fact that you accept. So, leaving aside the situation a few years ago, we have to recognise—the Welsh Government has to recognise—that this spending review does deliver more money, more real money for Wales over and above what we had before. And you take that in conjunction with the fiscal framework—which is a very good deal, negotiated between members of the Welsh Government and the UK Government, a great example of partnership working there—if you take it in conjunction with that, then over the last year Wales has actually seen a really good improvement in the formula with regard to the changes to the formula that happened and funding increases that mean that Wales can be—can be—in a much better place if the Welsh Government invest the money wisely.

Now, Minister, as I said, the First Minister was rather pessimistic when he said that a lot of these increases hadn't been signed off. Can you tell us what discussions you've had with the UK Government and with the Treasury in terms of these funding commitments? Do you share the First Minister's pessimism that, actually, a lot of this money is words and we're not going to see it here, or are you confident that this money, which you've announced in your statement is coming to Wales, will actually come to Wales? Because that is certainly what we have been promised and what we need to see here. You said that Wales shouldn't be a penny worse off from Brexit, something that was promised to us all back in the referendum campaign, and I think we would all in this Chamber want to agree with that. I certainly would.

You've, indeed, called for an end to austerity for a very long time: I can commend you on that, Minister. You have not veered from that message for as long as I've been questioning you, and, indeed, in your previous roles. We all want to see an end to that, and, as you said, the belt is now slackening. A corner has been turned. So, this should definitely be welcomed. And I'm sure that this hasn't made up for several years of cutbacks made necessary by people in another place, but we are turning that corner. So, what plans do you have for this new money? When will we see the detail of that? The Welsh Government has autonomy to spend it as it wishes aside from the well-known capital and revenue distinctions, which I'm sure Mike Hedges will go into—I can see him writing furiously over there. So, we need to know what the priorities of the Welsh Government will be.

You've mentioned the health service. There is a significant amount of money that the UK Government has promised to the English health service. Can you give a commitment that that money will feed through the system and will help deal with some of the pressures that the Welsh health budget has been under pressure from? It's been crying out to you to help with.

You mentioned education spending. As we know, school funding in Wales has not kept pace with inflation over recent years. Between 2010 and 2019, gross budgeted expenditure rose by 4.4 per cent, but that was actually a 7.9 per cent decrease in real terms. Back to that important word: real. So, what are you doing to arrest this? What are you doing to make sure that over this year and the years to come that that will be altered and that the funding gap, that all-important funding gap between pupils in England and Wales, can be addressed and dealt with? I know statistics aren't the be-all and end-all. I'm sure the education Minister would remind me of that if she was speaking in this statement, and I accept that. But, nonetheless, there is a recognised funding gap there, which I'd like you to address.

We had the customary Brexit cliff-edge discussion. I think my views are quite well-known as I certainly think that we should leave with a deal. I think that that is in the best interests of Wales. I do not want to see the effects on the Welsh economy if we do have a 'no deal' Brexit, and I'm sure that the Minister would agree with that. I think it's a shame that in Westminster, when it was discussed and there was a vote taken on it, that, actually, a lot of Labour Party MPs—not Assembly Members, but MPs—didn't vote for a deal, so we're in the rather upsetting situation that we are at the moment. But I agree with you that I would like to see us leave with an all-important deal.

In terms of the budget, can I welcome the move to bring the Welsh Government budget earlier to November, I think you said? That is certainly to be welcomed. You said you're going to hold discussions with the Finance Committee and with other committees. If you could have those discussions as quickly as possible and set the wheels in motion. We're already in September, so I appreciate the time for these budget lines is often very constrained and, in this case, this will be even tighter, but I think there is merit in us having those discussions as early as possible so we all know where we are and that we can get on with the job of putting that money into public services in Wales where it belongs.