WIREDGOV

Following the Chancellor’s announcement Finance Minister Jane Hutt said:

"Today, the Chancellor had an opportunity to take action to help hard pressed families across Wales who are suffering from rising prices, as well as rising taxes and falling benefits.  I am very disappointed that he didn’t take this opportunity.

"The 1p cut in fuel duty is to be welcomed, but only goes a small way to compensating for the 3p increase resulting from the rise in VAT to 20%.  And while the increase in Income Tax allowances will also be welcome to hard pressed families, it is small comfort for the £700+ impact of the tax rises and benefit cuts imposed by the UK Government.

"I am particularly concerned that the Office for Budget Responsibility’s growth forecast has had to be revised down – from 2.1% this year to 1.7%.   This just demonstrates how fragile the recovery is.

"in this context, we were hoping today for a real indication that the UK Government has a plan for growth and jobs.  There are some measures in today’s Budget that will help.  Plans for regulatory reform, increasing access to credit for small businesses and reducing tax for business are all consistent with the Assembly Government’s Economic Renewal Programme.  We will need to study the UK Government’s plans in more detail – including plans for new Enterprise Zones – but the overall package is extremely limited given the challenges we face.

"The Budget includes small amounts of additional funding for Wales in future years – up to £65m over the next five years, which is equivalent to an increase of 0.1% in the resources available.  Welsh Ministers will consider how best to use these additional resources and make announcements in due course.  

"I am encouraged that the Budget confirms the UK Government’s commitment to fair and accountable funding for Wales, including taking forward discussions on all aspects of the final Holtham report.  We will continue to press for correction of the underfunding of Wales as the key priority.”

The Minister also said that while a new system to replace End Year Flexibility had been announced she was disappointed that the UK Government has written off £385million of our accumulated stocks of End Year Flexibility (EYF).  

"This is our money voted by Parliament to Wales that should be used to support investment in public services and in supporting the economic recovery, rather than retained by the Treasury. It does not appear that the new Budget Exchange announcements will rectify this loss.

"I am now seeking a meeting with the Chief Secretary to the Treasury to discuss the impacts of the Budget, taking forward the fair funding Holtham agenda and the flexibilities we need for sensible budget management."