WORKING HARD FOR WALES?

The Party of Wales has criticised the lack of detail on borrowing powers to Wales provided by the joint statement issued by the UK and Welsh Governments. The statement follows twelve months of bilateral talks between the two governments. The party has also criticised the lack of a clear commitment to the reform of Barnett or a formula to fix the Barnett floor.

Ieuan Wyn Jones AM, the party’s Shadow Finance Minister said:

“The Welsh Government entered into the bilateral discussions with the twin aims of securing borrowing powers and fixing the Barnett floor at 115% of spending in England as originally proposed by Holtham. This statement shows that they have failed on both counts.

“Wales has already lost over 40% of its capital budget, and the economy is in crisis. We need to have borrowing powers immediately so that we can kick start the construction sector and boost jobs. The Treasury’s weasel words on borrowing shows that they have failed to grasp the enormity of the economic crisis we face with 50,000 young people unemployed. The statement doesn’t even tell us how much Wales will be allowed to borrow at some future unspecified date.

“The failure to agree a formula to fix the Barnett floor also shows that the Treasury is now clearly complicit in perpetuating the underfunding of Wales.

“This announcement has the Treasury’s paws all over it, and I can’t understand why any First Minister of Wales would sign up to it. I would have been ashamed to have signed up to this weak and bland statement. There is no mention at all of the longer term need for a wholesale reform of Barnett.”

THE SOUND OF SILENCE...

The news that Wales is missing out on up to £140m more per year more than was originally thought because of the unfairness of the Barnett Formula, should not shock anyone. Back in 2010/2011, our country missed out on up to £540m, this makes Plaid’s call for the implementation of a needs-based system, or a short-term solution to make up the shortfall, more urgent than ever. The publication by the UK Government of the public spending figures for 2010/2011, revealed that the funding shortfall for Wales for that year came in at some £540m. This figure is substantially more than the £400m figure that was estimated by the independent Holtham Commission back in July 2010. This should make the case for overhauling Barnett pretty water tight and more urgent than ever. I hope I am wrong, but, I suspect that a combination of a financially challenged Tory driven Westminster government and an inert, inept Labour in Wales Government in Cardiff Bay will means that the problem of the underfunding won’t get sorted anytime soon. So any sound of silence near us in the future will be the sound of Unionist’s working hard for for Wales then...

THEY DOTH PROTEST TOO MUCH...

The Labour Party in Wales has said that Wales is underfunded to the tune of £300m which is something that the Holtham Commission, which looked into the way Wales is funded, reported. While I am pleased that the Labour Party in Wales has finally recognised this, I find it hard to reconcile it with the fact that they were in government for 13 years and did precisely nothing to change the flawed Barnet funding system, when they had the opportunity. Now, being in opposition in (and out of) Westminster and in Government in Cardiff Bay, all is urgency (or political expediency) and the crocodile tears begin to flow copiously...

There is that more than faint whiff of self satisfied smug glee and more than a little joyful if not ecstatic hand rubbing from some of Tory mainstream (sorry right) in relation to the mess that some of the Euro zone countries have got themselves into, ignoring the fact that the Euro is actually pretty sound, the problem is being caused by the banking idiocy that gripped much of the world - something that most governments did little to try and curb or criticise when things were bubbling along quite nicely.

The Irish situation is more complicated than most as successive Irish governments made significant quantities of hay while the sun shined brightly and appear to have made little or no provision for rockier economic times (just like almost every other government on the planet) and now the Irish people are paying for it (just like us). All governments Europe and worldwide would do well to note the slowly (and not so slowly) rising degrees of discontent that that paying for the banking crash is generating.

THE BUDGET

Now that the dust has settled, it's pretty clear that once again that the New Labour Government failed to announce a fair funding system in this year’s Budget, which means that we in Wales will be hit hard by a 5% real terms cut when the new financial year starts. The failure to ensure fair funding for Wales, with either a fair system or a fair deal has sadly become a signature failure of what's now nearly 13 years of New Labour Government.

The Budget Red Book, suggests that there will be a real terms cut of around 5% once inflation is taken into account –which will start not next year but in little less than two weeks time.There can be little doubt that there are deep cuts coming, which we can be sure will hit Wales hard before we begin to leave this recession behind. initially it was estimated that the Welsh budget would be hit by £2.8bn over three years, but recent revisions by independent bodies such as the Auditor General for Wales estimate £3bn or more over three years - however you spin it that's a big ouch"!

The failure to hold a Comprehensive Spending Review before the General Election and the failure to make it clear exactly where proposed cuts are going to being made, once again leaves the people of Wales well and truly in the dark – and unable to see what the effect will be upon Welsh public services. It is ironic that both New Labour and David ('Call me Dave') Cameron's Conservatives are very happy to tell us what they will keep in the UK Budget, but much more reticent when it comes to telling us what they will cut and where, which is the real issue.

The current funding formula for Wales, where the money for our public services comes from is decided by spending priorities of London, we in Wales will not know the effect upon Welsh public services over the next three years until they have been announced in detail in England. The Holtham Commission recommended that the Treasury in London produce an annual publication
which provides details of changes to the Assembly budget arising from decisions made in London - this has not happened.

The Welsh Department Expenditure Limit for 2009-10 was £16bn and will be £15.7bn in 2010-11 which begins on 6th April, 2010. Taking inflation into consideration this will be a cut of 5% year on year to the Welsh block grant.When it comes down to brass tacks, while this is an unacceptable state of affairs is acceptable to new Labour and Conservative MP's in Wales it is no and never wil be acceptable to Plaid and many people within Wales.

The only way this unacceptable state of affairs will be rectified is by ensuring that Wales has a strong voice in Westminster and the only way that is going to happen is by sending more Plaid Cymru MP's to Westminster. The old two parties have failed us, failed our communities and failed Wales. We need to think differently, we need more Plaid MP's something that will ensure
that people in Wales will be electing MP's who will actually stand up against these cuts wherever they will have a negative impact upon our communities and our public services. It's time to think different, its time to think Plaid.