3. Statement by the Minister for Finance and Local Government: Welsh Government's response to the Chancellor's statement on the medium-term fiscal plan

Part of the debate – in the Senedd at 3:00 pm on 18 October 2022.

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Photo of Rebecca Evans Rebecca Evans Labour 3:00, 18 October 2022

Thank you to the Conservative spokesperson for those comments this afternoon, and I agree with him, it's not been a good few weeks, to say the least, and it is certainly disappointing. I think that he's done the best he can there to send a strong message to his colleagues in Westminster in terms of the Welsh Conservatives' assessment of the recent shambles that we've seen in Westminster.

But I do welcome the letter that the Conservatives will be sending the latest Chancellor regarding benefits—[Interruption.] It's gone, that's great. So, hopefully, this Chancellor will stick around long enough for you to have a response, because I didn't get one from the last one. But I do think that is to be welcomed in terms of your support for raising benefits in line with inflation, and that's certainly to be welcomed.

There were lots of comments there in respect of growth and how the Welsh Government sees growth. Well, the growth commission that was established by the London School of Economics was created in order to identify ways of improving the UK's lacklustre growth performance, and that commission itself highlighted the vital importance of continuing to invest in the education system and in adaptable skills and lifelong learning. It also stressed the key role of infrastructure as a vital component in sustainable growth, and it argued for higher, not lower levels of investment in infrastructure across the UK. That's entirely consistent with what the First Minister and my other colleagues are always talking about in terms of how we understand growth. It is investing in people, it is investing in skills and it's investing in infrastructure. We want to see, particularly, investment in green infrastructure to take us towards net zero and to help address the climate and nature emergencies.

It's also worth bearing in mind as well that analysis for the UK Government's own National Infrastructure Commission has demonstrated the vital role of maintaining investment in infrastructure in order to meet the challenges of improving the economic performance of lagging areas and also achieving net zero and delivering climate resilience and a better environment. So, again, even that infrastructure commission is very much seeing things as we are in Welsh Government.

The UK Government's vision for growth just seemed to be about cutting tax for the very richest, as if that was going to be the incentive that they needed, and then there's really nothing left of the UK Government's vision for growth in the existing plan, apart from the ongoing commitment, as I understand it, to the investment zones. Yet we have very little detail as to what those investment zones might look like. We look forward to further discussions with the UK Government on that.

The Member also referred to the discussion I had with the Chief Secretary to the Treasury. That was yesterday, and I did that alongside my counterpart in Scotland. That was a very useful, I think, first conversation, but what we really need is a chief secretary who really does see it as part of his core responsibilities to have that relationship with the Welsh Government and with the other devolved Governments on a day-to-day basis, and somebody who is going to take a real interest in Wales, so that they can really grapple with the things that we're trying to make progress on with the UK Government.

This, as the First Minister said, will be my sixth Chief Secretary to the Treasury and that's a problem, in the sense that you have to go back to the beginning every time you work with a new Chief Secretary to the Treasury, because lots of the issues that we're trying to progress with them are really detailed and complex. The issues around replacement EU funding and the formula that the UK Government used to determine that funding, which leaves us £1 billion worse off, we need to have detailed discussions about that. We need to continue those discussions that we're starting to have around fiscal flexibilities for Wales. So, it is disappointing when you have to just go back to zero time after time with these discussions. So, I'm hoping that building good, new, strong relationships with the latest CST will start to take us down that road as well. I look forward to continuing that relationship.