IT MAKES SENSE…

Plaid Cymru has called for an additional 1 per cent of GDP to be invested across the UK in infrastructure. This is an additional £19 billion pounds a year on top of the 1.2 per cent (£23 billion pounds) to which all the London based and Westminster focused parties are committed. Research by the IMF has calculated that for every £1 spent on infrastructure some £3's worth of additional economic activity is created. At a time when Wales needs investment, job creation and improvements in its infrastructure, such investment could yield real dividends for our people. The more job creation we can stimulate and the better improvements to our infrastructure, the better the long-term prospects will be for the Welsh economy.

AUSTERITY OR AUSTERITY LITE?

It’s not much of a choice, especially when you consider that by polling day only 40% of the Con Dems cuts will have taken place. Before the Autumn Statement, Plaid warned that the Government’s spending plans for the next parliament would take us back to the 1930s if the proposed reductions in public spending were pushed through.

The Labour party understandably attacked the Tories for their plans to reduce spending on public services to levels not seen since the 1930s, at 35% as a share of GDP. Yet, what should alarm people is that the Labour parties’ economic plans are essentially the same. Labour’s plans would see spending on public services at roughly the same, 37% of GDP – reducing it to a level that we have not seen since the 1930s, a time before the creation of the NHS and when people left school at the age of 14.

If nothing else, this reveals that there is little or no difference between any of the larger Westminster parties, with Labour lumped to the Tories’ ideological plan to shrink the size of the state and intentionally hack at our public services. At the next Westminster general election, the real choice being offered the people of Wales is between the Westminster parties who all offer more austerity and more hardship, or Plaid Cymru - who, in the forthcoming hung parliament where every vote counts, will demand an end to austerity and fight for the need to invest.

Plaid Cymru has set out its plans to increase investment infrastructure by 1% of UK GDP annually. Institutions such as the International Monetary Fund and the Confederation of British Industry have noted that for every £1 invested it produces £2.50 - £3.00 in the real economy. This would be an investment of around £16 billion at a UK level, bringing £800 million to Wales to invest in schools, hospitals, and other works to improve the economy.

This investment would help us to tackle the deficit over a much longer period. Investment is the perfect antidote to the cosy Westminster Parties’ consensus, which seeks to inflict ever greater levels of austerity on our people. Austerity will ensure that places like Wales suffer as they seek to balance the books on the backs of the poor.

MADE IN WALES

Many people are concerned about the state of the economy as the latest GDP figures show a deepening of the double-dip recession, with a 0.7% drop in output during the second quarter. This is not good and the UK Westminster Government has not helped matters with cuts on capital spending projects as the crisis in the construction industry (whose output has slumped dramatically with quarter-on-quarter falls of 5.2% and 4.9% in the last two quarters) threatens to get worse.

The UK Westminster Government spending plans will do lasting damage to our long-term economic prospects. It’s time for job-creating taxation powers to be transferred to the Welsh Government so that we can create ‘made in Wales’ economic solutions, as by now it’s pretty clear that those from London are clearly not working.

Plaid Cymru Treasury spokesperson Jonathan Edwards MP (on Wednesday 25th July) said:

“These are truly disastrous figures showing that the economy is in a downward spiral, with the worst double-dip recession since the 1950s.

“They show weakness across the economy, with the construction industry quite clearly in crisis.

“We are paying the price for failing to invest in infrastructure spending when the financial crisis began. If the London parties had introduced our infrastructure policies when we first proposed them then the construction industry would be booming and we would be looking forward to new roads, hospitals and schools.

“Instead, cuts to capital budgets mean that very little construction is now being undertaken by either the public or private sector.

“The concern is that these cuts are doing not just short-term, but very long-term, lasting damage to the productivity of the economy.

“We are in a lost decade with a stagnant economy contracting once again and the current direction of travel shows no indication of improvement, and the Tories still refusing to recognise that their financial plans have failed.

“It is now more urgent than ever that job-creating levers, such as control over income and corporation tax, are given to the Welsh Government so that we can have ‘made in Wales’ solutions to these economic problems – because it is clear that the Tory government in London don’t have a clue.”