5. Statement by the Minister for Finance and Trefnydd: Fiscal implications for Wales of the impact of, and response to, COVID-19

Part of the debate – in the Senedd at 4:37 pm on 13 May 2020.

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Photo of Rhun ap Iorwerth Rhun ap Iorwerth Plaid Cymru 4:37, 13 May 2020

(Translated)

As this is the first opportunity I've had to question the Minister during this crisis, I want to pursue a few fundamental issues. I will ask first of all for a little more information about the issue you just mentioned in terms of persuading the Treasury to look differently at how the Welsh Government can use its borrowing powers. I appreciate the clarity in terms of what you're seeking as a Government, but may I ask you whether there's been any indication from the Treasury as to how willing they might be to respond positively to this request made by the Welsh Government so that we can try and assess where we stand at the moment?

There are other elements in terms of flexibility that are required, too. I agree with the Minister when she said that flexibility is required at the moment. The Barnett formula is one such element. This is a formula that's entirely inappropriate, and it's been criticised over a period of decades now for failing to respond to need. If we look at a number of factors here in Wales, we know that COVID-19 hits the elderly more than young people. Our population in Wales is older than the UK average. It hits the less privileged economically and more of our population is in that category. So, what discussions have taken place in terms of introducing a new system at this time? It's an exceptional time, and therefore we do need exceptional fiscal arrangements. We could have very intense pockets of cases of COVID-19 either in Wales or in parts of England, and we will need flexibility in the system, including the fiscal system, in order to secure cashflow.