5. Statement by the Minister for Finance and Trefnydd: Update on fiscal impacts of COVID-19 and future budget prospects

Part of the debate – in the Senedd at 4:52 pm on 6 October 2020.

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Photo of Rebecca Evans Rebecca Evans Labour 4:52, 6 October 2020

Apologies, acting Presiding Officer, I didn't hear you.

Thank you very much to Rhun for those questions, and, as always, for Plaid Cymru's support for the Welsh Government's calls for additional flexibilities. That support is also recognised by the Institute for Fiscal Studies, the Wales Governance Centre and even, of course, our own Finance Committee, which is a cross-party committee here in the Senedd. So, there is, I think, a wide recognition that what we're calling for is simply common sense in allowing us to exercise good budget management, and I'm very happy to work in partnership with anyone who shares that ambition in terms of increasing the pressure on the UK Government in that regard, which is why it's been such a pleasure to work with my counterparts in Scotland and Northern Ireland on this particular issue. Today, all three of us are making statements to our own individual legislatures on this particular issue, all reinforcing those same points about the importance of flexibilities, and I think that working together on these matters is really important as well.

In terms of a supplementary budget, you would have heard me say to the Conservative spokesperson that it's my intention to bring forward an interim supplementary budget in October, so later on this month, and then we'll ensure that it meets all of the requirements of Standing Orders and, of course, gives three sitting weeks for the Finance Committee to scrutinise it as well. That's, I think, really important, because it does allow that level of transparency for the Senedd and also pulls together all of the actions that we've taken to respond to the more acute end, if you like, of the coronavirus pandemic. It will set out the support that we've made available for local government, which I know Rhun ap Iorwerth is particularly interested in, having raised it with me previously.

We've made available nearly £500 million of additional funding to local government through the local authority hardship fund. That includes £292 million to provide general financial support for local authorities to help them meet the additional cost burden that they're facing as a result of the coronavirus pandemic; £78 million to replace the loss of income that local authorities are experiencing as a result of the pandemic—many operate services such as catering, car parks, leisure centres, cultural services and so on, which have been hard hit, so that's to help them with that loss of income; £62 million to support the provision of social care services, because we know the additional pressure that they're facing as a result, again, of the pandemic; £38 million for free school meals; and £10 million additional funding to support homeless people with a particular aim of ensuring that nobody is sleeping rough during the pandemic.

So, we've made a substantial additional funding package available for local authorities, and have listened to local authorities when they've wanted to work with us to make accessing that fund simpler and quicker and more streamlined, for example changing the way in which we provide additional funding for social services to one that provides a per-head top-up, if you like, for the people who they are supporting, rather than having to undertake a more onerous application to the fund. So, we're in constant discussion with local authorities about the support that they need, and the support there, the aim is for that to see them to year end, but of course we are in constant discussion as to whether additional support might be needed.

In terms of the announcement that has been made today of the additional £340 million for reconstruction, you'll have heard me say in my statement—and the Counsel General has made some references to items in his statement also—about additional funding to step up the construction of council and social housing over and above the funding that I announced when I made my decision about the land transaction tax rates just a few weeks ago, and additional funding to support young people in further education in particular, and those young people who may need additional catch-up support. However, these are the headline figures, if you like, and individual Ministers will be making announcements for those particular matters that sit within their portfolios in the near future. Of course, the overall budget position in terms of where we are now—. So, as I mentioned in the previous response, we think we're at the top end of that £4 billion guarantee, but we're seeking additional clarity on that from the UK Government.