Wednesday, December 9, 2015

Briefing paper on Welsh budget cuts 2016-17 for Left Unity Wales

Welsh Government – draft budget 2016/17

Left Unity Wales analysis and comment

The draft budget for Wales was published today by the Welsh Government: it continues to represent a cut in real terms spending over the current year of around 1.5% as a direct consequence of the announcement made chancellor Osborne in his spending review two weeks ago.

Jane Hutt the Wales finance minister has tried to make the best of a bad deal by re-balancing expenditure toward the NHS – this has to be done to avoid serious service challenges. As the details unfold, all services in Wales will see the screws tightening over this and the next four years, on top of cuts already made in previous years.

The People’s Assembly Wales has calculated that if the £16 billion spending of 2009/10, the final year of benefit of the last Wales comprehensive spending review was protected against inflation it should be £18 billion by 2018 not the £15.5 billion that is projected. This is a real terms cut of 16% as a direct consequence of the financial crisis.

As Jane Hutt has already admitted increased service demands, such as from an ageing population and welfare cuts, are likely to increase budget pressures by £1 billion over the same period. If this happens, the real cut will be nearer 22%.

Families across Wales will also be directly hit by the welfare cuts announced in Osborne’s spending review. One recent Welsh Government estimate was that these would cost Welsh families around £1 billion a year. Over the next four years they have been estimated to increase by another £500 million.
Taking the cuts in services together with these welfare cuts we estimate that an average family of four in Wales will be losing £6000 per year in the social wage and direct benefits. Of course lower income households will lose more, possibly up to £10,000 per year.

Over the next few weeks, as the reality of yet another round of austerity rolls out across the Welsh NHS, councils, schools, further and higher education, people locally will start to experience the pain of the Tory cuts.

The working class are still paying for a financial crisis they did not create.

The People’s Assembly Wales is calling upon Assembly Members to do all they can to avoid this cuts. If, at the last resort, alternative money cannot be found, then they should be prepared to challenge the Tory government and vote against a cuts budget. They should not just pass their problem down to local people and service providers like councils but pass it back up to the government that created it. If the unelected House of Lords can challenge the government so can our elected Assembly.

Please sign this People’s Assembly Wales #noausteritywales 38 Degrees Petition:

Links:
Here is the full budget details – see ‘Draft Budget action tables for the figures’: http://gov.wales/funding/budget/draft-budget-2016-17/?lang=en

2009-10 budget is as it was the last year to benefit from the last Welsh comprehensive spending review: http://www.assembly.wales/Research%20Documents/Draft%20Budget%202009%20-%20Research%20paper-11112009-152521/09-030-English.pdf


And here, using the formula 2009/10 up to 2014/15 then uprating for inflation using the UK Treasury annual projections 2015/16 up to 2017/18 : https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/205904/GDP_Deflators_User_Guide.pdf.

Extra £1 billion in demands – Welsh Government statement: http://www.walesonline.co.uk/news/politics/welsh-public-bodies-face-1bn-10471009

Effect of additional welfare cuts in Wales – Welsh Government statement: http://gov.wales/about/cabinet/cabinetstatements/2015/julybudget/?lang=en




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